Make a clear start with your debts

Debt Management can help you make a clear start with your debts

Debt management to make a clear start in your life can be extremely helpful if the debts are assessed early enough. With UK spending higher than ever in recent years, finding a way to pay off personal debts has never been so important.

Our trained debt managers can talk you through every step. By taking all your debts into account, we can put them together and agree a repayment schedule that can be accommodated by your finances. Quite often, it’s possible for our debt managers to negotiate a lower interest rate on repayments.

A debt management plan is often the first port of call for those in debt, due to the simplicity in the set up and non-legal agreements that are made. If this agreement can be adhered to, this is usually the best way to clear your debts.

Make a clear start with an IVA

An IVA (Individual Voluntary Agreement) may be necessary if your creditors refuse to accept a debt management plan. IVAs are usually set out over a 5 year period and can be negotiated to best meet your repayment capabilities and lower interest repayments may even be possible.

IVAs are legally binding documents, and therefore must be signed and agreed to in the presence of a licensed insolvency practitioner. Due to the legal nature, it’s extremely important to meet all repayment deadlines.

Make a clear start with Bankruptcy

Declaring bankruptcy is a major decision and should be done so after investigating all other avenues of debt management. Those who are unemployed, on long term incapacity benefit or retired may find bankruptcy to be the best option available and to file for bankruptcy, you must owe over £750.

There are a range of advantages and disadvantages to declaring for bankruptcy.

On the positive side, once bankruptcy has been finalised, all debts are cleared immediately after approval.

Some of the negative areas include, if any money is inherited during a bankruptcy order, this will have to be used to cover the debts. If you are earning a decent salary each month, a portion may be taken as part of an ‘income payments order’. Depression is also common among those who declare bankruptcy.

Useful links to make a clear start with your debts

• Make a clear start with your debts with an IVA
• Make a clear start with your debts after divorce
• Make a clear start with your debts after a death in the family
• Make a clear start with your debts due to gambling

Case Study

Wilmot Renkins, 38, contacted the advice service explaining he was in debt and wanted to make a clear start as he was tired to avoiding his creditors. After a short career as a singer / performer he had one successful song called “I saw a little man” but failed to secure a recording contract. He had debts of £38,000. He successfully entered into an IVA and reduced his debts by approximately 60%.

Money Advice Direct is an established provider of confidential and non-judgemental debt advice in the UK on serious debt problems. Whatever solution we recommend, honest, best advice is available 24 hours a day, 365 days per year. If you are in debt call us without obligation today on 0800 074 6918 or apply for debt help online and make a clear start today.

Listed below are some of the frequently asked questions on Debt Management Plans

• How do I know whether a Debt Management Plan is right for me?
• What are the advantages of a Debt Management Plan?
• What are the disadvantages of a Debt Management Plan?
• Is a Debt Management Plan a type of loan?
• How long will I have to pay a Debt Management Plan before I am debt free?
• How much does a Debt Management Plan cost?
• How much money will actually go to the companies I owe money to under a Debt Management Plan?
• How do I make the payments?
• If I have a change of circumstance can I stop the Debt Management Plan?
• Who tells the companies I owe money to that I am actually in a Debt Management Plan?
• Will the companies I owe money actually accept a a Debt Management Plan?
• How a will Debt Management Plan affect my credit status with Experian, Equifax and Callcredit, the three main credit reference agencies
• Will a Debt Management Plan stop all the companies that I owe money to constantly telephoning me and sending me letters?
• Will I receive a regular report to inform me that my debts are actually going down?
• After the Debt Management Plan is set will I receive be able to get any additional help and advice?
• After the Debt Management Plan is set up can I still use a credit card or apply for car finance if I budget for it?
• Once the Debt Management Plan has been set up does it mean that I will have to keep paying interest and bank charges?
• Can I include secured loans in a Debt Management Plan, such as car finance or mortgage?
• Can the companies that I owe money to threaten to take my house or flat once that I am in a Debt Management Plan?
• Can I include all my debts in  a Debt Management Plan?
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