Debt is a psychological constraint. It is a disease that is pleasant first but gets worse with time.
First, don’t panic but don’t ignore your financial obligations either; the problems won’t go away on their own.
Don’t ignore all the contacts from your Creditors (the people or companies you owe money to). Make clear that you’re having issues and are going to try and get advice or help.
If you don’t think that you are obligated to pay any debt, then seek advice from some governmental or independent organisations. Read below the tips to get debt advice.
The debts to manage first are usually known as the Priority Debts; those are the ones that may have the most critical implications if you don’t pay them back.
Most of these include:
- Rent or mortgage Debts – As you could lose your property
- Fuel Debts – As the supply could be stopped
- TV Permit – As it’s a criminal offence to use a TV set without one
Consumer financial debt such as loans, hire purchase, credit cards and bank account borrowing are the most common of these, but additionally, there are such bad debts as benefit overpayments, student education loans and money borrowed from friends or family.
Most of these creditors can take you to the courtroom if you don’t pay, but if you make a proper agreement, this might not happen. They can’t send bailiffs until the judge allows them to.
An important thing to do is to acquire all the details about your bad debts. If any are from a court or seems important, you may need to take appropriate steps swiftly.
Get the most recent statement for each and every financial debt and try to ensure that you get it for each Creditor you know:
- Their address and name
- The particular amount you are obligated to pay
- Any reference or account number they’ve used
- What you should pay them
Getting Advice & Help
Many people use the services of debt management company; many are free but some charge (read below).
- National Debt Advice (nationaldebtadvice.org.uk): Their help and advice are free, confidential, independent and impartial and they’ll give suggestions to solve your financial troubles and may refer you on for further assistance.
- National Debtline: Provides free details to people with debt issues. The advice is free.
- StepChange Debt Charity: This charitable organisation is providing confidential and free advice to people worried about their financial debts. The website also offers a tool for calculating the individual debt solution.
- Payplan: A completely independent debt relief company providing free debt help and advice to reach alternatives. They make it easier to find the best solution of the financial troubles and if suitable can approach lenders and deliver monthly payments.
Some organisations offer to put all the debts together as a single loan which is usually known as debt consolidation, but this can be costlier, so get help and advice from the above organisations before you do this.