Consumer Debtline

Consumer Debt Solutions

WAYS TO OVERCOME FINANCIAL PROBLEMS

For UK consumers looking to overcome debt problems there are a number of options. A brief overview of the various solutions can be found below –

Individual Voluntary Arrangements
Debt Administration Orders
Debt Consolidation Loan
Debt Management Plans
Bankruptcy

INDIVIDUAL VOLUNTARY ARRANGEMENTS (IVA's)

For individuals with debts of greater than £15000 divided between multiple creditors an Individual Voluntary Arrangement is an option. An IVA is a formal agreement to consolidate your debts into one single monthly payment. Typically the IVA will last for five years at the end of which any remaining unpaid debts will be written off.

More information – Individual Voluntary Arrangements.
Or alternatively visit our specialist IVA website.

DEBT ADMINISTRATION ORDERS

If you owe less than £5000 and have more than one creditor then a Debt Administartion Order is an option. An Administration Order can be obtained via your local County Court. Under the conditions of the Order you make a single monthly payment to the Court. This consolidated payment is then distributed between your creditors.

DEBT CONSOLIDATION LOANS

A consolidation loan is used to group your existing debts into a more easily manageable single payment. Before taking out a loan of this type you need to ensure that it will lead to an overall reduction of your debt repayments. The interest on the loan should be sufficiently low to allow the loan to be repaid over a resonable length of time. A debt consolidation loan may also be difficult to obtain if your personal credit rating has already been badly affected.

CONSUMER DEBT MANAGEMENT PLANS

A Debt Management Plan is an 'informal arrangement' made between yourself and your creditors to reduce the amount of your debt repayments. The plan can be arranged either by yourself or alternatively with the assistance of the Citizens Advice Bureau or a commercial debt management company.

More information - Debt Management

BANKRUPTCY

Bankruptcy is often seen as a 'last resort' option for people with debt problems, however in many cases it is also the most suitable. While becoming bankrupt is the least costly way to resolve your debt it does have a number of negative consequences which should be considered. If you are made bankrupt the bankruptcy order will be advertised in your local newspaper, your home could be repossessed and you may have difficulty obtaining credit even after the bankruptcy is complete.

Further reading - Bankruptcy

To speak to one of our advisors and find out how you can overcome your debt problems either complete our enquiry form or alternatively call us on freephone 0800 043 50 43.