The Parish Churches of St. Mary and St. James, West Derby
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Debt help guide

In these difficult times, more and more people in the UK are finding it difficult to make their household budgets stretch to meet the increasing costs of living. For many people, borrowing money to make ends meet has led to serious debt problems.

Being in debt can be extremely stressful. If you are worried about your debts, the first thing to do is acknowledge that there is a problem and to take action. The sooner you address your debt worries the better.

Remember - free debt help <> is at hand. Make sure you never pay for debt advice but seek free, impartial and confidential help from a charity like the Consumer Credit Counselling Service (CCCS)

Make sure you donít:
Carry on using your credit cards
Increase your overdraft limit
Take out any further loans
Consolidate your debts
Secure any of your debts against your home

Make sure you do:
Contact a charitable organisation such as CCCS and get free debt help as soon as you can.

Regain control of your finances

Hereís a quick checklist to help you do some financial housekeeping:
Budget - List all your monthly outgoings and income. Work out how much you have left to spend each month after paying all your bills. Try not to spend more than your calculated budget allows.
Make reductions - What expenditures can you live without? Highlight all the little extras that are not essential and see how much you could save by cutting them out.
Increase your income - Make sure you are getting all the benefits and tax credits available to you, take regular overtime, get a part time job or think about taking in a lodger if you own your own home.
Review your situation - Use comparison websites to see if you could be getting a better deal on any of your utilities by switching to a different service provider. Always check the small print before switching.

Structured debt solutions

Sometimes a more structured approach will be needed to deal with your debt problems. There are several solutions available, and some will suit your circumstances better than others.

In all cases it is extremely important that you seek free and impartial advice from a debt help expert, who will help you to decide which solution is best for you.

Debt management plans
A debt management plan, or DMP, involves a third party - such as a debt charity like the CCCS - arranging an affordable repayment plan for you with your creditors. They will negotiate with creditors on your behalf and manage your payments for you. Be wary of the many debt management companies that charge fees for this service. CCCS provide DMPs completely free of charge.

Debt relief orders (DROs)
Debt relief orders are open to people whose assets are worth less than £300 and who do not own their own homes. Your debts must total less than £15,000 and you must also have less than £50 left over each month after paying all your bills.

A DRO is a legal process that freezes your debts for 12 months, during which time, your creditors will be unable to pursue payments from you or to add any charges or interest to your debt. If at the end of this time your financial situation is unchanged, your debts will be written off.

Individual voluntary arrangements (IVAs)
An IVA is a legal process for those with debts totalling more than £15,000. IVAs have to be arranged by Insolvency Practitioners who will establish an affordable, five-year repayment plan with your creditors. You may also have to make a lump sum payment on top. If at the end of the five years you still owe money, any remaining debts will be written off. In order to be granted an IVA ,at least 75% of your creditors must agree to it.

If you canít repay your debts within a reasonable time, bankruptcy may be the best option for you. Your unsecured debts must be greater than the value of all your assets combined, including your home and any vehicles you own. Bankruptcy will clear all your unsecured debts but has serious consequences for many aspects of your life. For instance, you may have to give up all your assets, including your home. Bankruptcy should not be considered without first taking seeking professional debt counselling.

Get free debt help now
You donít have to pay a penny for expert debt advice. Free, impartial, and confidential debt help is available through the Consumer Credit Counselling Service (CCCS) right now.

Use the CCCS DEBT REMEDY tool online to get free and impartial debt advice tailored to your individual needs. Itís available 24 hours a day and is completely free and confidential.

For more information and debt help advice, visit <>