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if you're in debt, you're not alone

If you're in debt, you're not alone

If you’re struggling to keep up with your day-to-day bills, credit card repayments or other financial commitments, like your rent - access free debt advice to help you decide the best way forward.

Take the Money Advice Service’s free online debt check to work out the best option for you. It will also put you in touch with people who can help with free debt advice in your area www.moneyadviceservice.org.uk/en/articles/debt-health-check#

it’s good to talk

Our financial inclusion team are here to help. They can offer non judgemental help and support and point you to the right people who can help you take control of your finances.

The Money Advice Service also offer free impartial advice online, over the phone or face to face. Their specially trained advisers can help you start sorting out your financial problems. www.moneyadviceservice.org.uk/en

Step Change offer free debt advice and can help you get your finances back on track, visit their website https://www.stepchange.org/contact-us.aspx or call them on 0800 138 1111 Monday to Friday 8am to 8pm and Saturday 8am to 4pm. 

The National Debtline give free and independent debt advice over the phone and online visit their website https://www.nationaldebtline.org/ or call them on 0808 808 4000 from Monday to Friday 9am - 8pm and Saturday 9:30am - 1pm. 

Be debt free sooner than you think, talk to a free debt advisor today. People who access debt advice feel less stressed or anxious and more in control of their life again.

deal with priority debts first

It’s really important to deal with priority debts first. These are debts that have serious consequences like losing your home, or going to prison.

Priority debts include your rent, taxes, utility bills and court fines. These may not be your highest debts, but they are the most important ones to pay off. You can’t be sent to prison for not paying non-priority debts. But if you don’t make any attempts to pay them, the creditors may take you to court to try and recover the money.

Non priority debts include catalogue repayments, credit cards, store cards and money you’ve borrowed from family and friends.

Did you know? Your friends and family are not legally allowed to charge you interest on money they lend you unless they have a credit licence?

options for clearing your debts

There are lots of ways to clear your debts and it can be confusing to know the best way forward for you. What’s best for you will depend on your personal circumstances so speaking to our financial inclusion team or a free debt advisor from The Money Advice Service or the Citizens Advice Bureau is the best way to work out what is right for you.

A Debt Management Plan (DMP) allows you to pay back your debts at an affordable rate.

You make one monthly payment to the DMP provider based on what you can afford and the DMP provider pays and deals with the companies you owe the money to. This is a good way to pay back non priority debts such a store cards and credit cards.

A Debt Relief Order lets you freeze your debt for a year.

It will then be written off completely if your circumstances don’t change.

An Individual Voluntary Arrangement (IVA) allows you to pay back what you can afford.

This is done over a set period of time (usually 5 or 6 years) and then anything you haven’t paid off by the end is written off. This is a legally binding agreement both you and your creditors must keep to the agreement.

Bankruptcy writes off all debts you can prove you owe.

This allows you to make a fresh start. If you have any assets, they will be taken and used to pay off your debts.

Offer in full or final settlement.

If you have a lump sum that would cover part of your debts, you could ask your creditors whether they would accept a part payment and allow you to write the rest off. Alternatively, they might allow you to make monthly payments for an agreed period after which the balance is written off.

Writing off your debts is an option if you have no available income, savings or assets.

This is done in exceptional circumstances and you must be able to show your creditors that your circumstances are unlikely to improve in future.

You might be able to apply to the County Court for an Administration Order.

If you owe under £5,000 and can afford to make regular payments towards your debts. You must have at least two debts – one debt must be a County Court Judgment or Higher Court Judgment against you.

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