Affordably pay down your debt for debt solution in UK

Debt relief program as an alternative to bankruptcy to consumer

A debt relief program, debt management plan and Individual Voluntary Agreement on bankruptcy alternatives. Quickly pay down your debt through a UK debts solution.

Debts Solution

Debts Solution

An increasing number of consumers are direly seeking an option of evading the debt in the UK. Price Waterhouse Coopers illustrated there were 120,000 personal insolvencies in 2009 were because of severe debt problems. A UK debt solution could give a good alternative to bankruptcy.

Are the debt free solutions necessary?

The Bank of England gave a report that the credit card debt written off by the banks increased from £812m to £1.6b within just the 3rd quarter of 2009. This implies that the consumer is not forgiven. A debt relief program aides consumers who are struggling to meet a substantial agreement with creditors to pay down debt.

Paying down debt using a UK debts solution.

The aim of debt relief program is to reschedule the repayment and make it more affordable, minimize debt, quickly paying down debt and prevent additional credit contact. Though some of the consumer debt relief programs are merely voluntary in nature, some are legally binding. Bankruptcy will have negative implications to the individuals credit-rating and make taking loans from lenders more difficult for a period of up to six years.

Individual voluntary arrangement. [IVA]

This is the major alternative to bankruptcy and involves paying down debt more than five years. 75% of the creditors (in value) must approve it at a creditors’ meeting. It is legally binding with creditors to repay a lower percentage of the amount owed. Additional charges and interests are frozen. An IVA makes the homeowner remortgage at the end of year four supposed contribute some money to the deal. After completing repayment an Bankruptcy practitioner issues a certificate of completion.

Paying down debt with a debt management plan

The aim of this solution is to present affordability to the consumer. It analyzes the budget, a monthly repayment which is affordable is determined. The client then makes one repayment each month to a mediator who will disseminate the money to creditors. The charges and interest may be frozen; there is no legal obligation for the lender to do so. This plan is an entirely voluntary and between the debtor and his creditors.

Debt relief order.

For those who own less than £15,000, this is a debt relief program for them. To qualify as well, you should have assets less than £300 and a disposable income, which does not exceed £50 a month. This is a form of bankruptcy that allows one to be free of debt in just 12 months. Its costs are £100.

Sources: “Debt statistics-February 2010.”

How to Choose a Right Debt Settlement Company

In these troubled times, most people are starting to look for a way to take a load off their monthly payments; if you’re looking to consolidate your debt, an easy way out could be debt settlement. This method could help you get rid of some of your monthly bills while maintaining your balance.

Debt Settlement.

Debt Settlement.

If you choose this solution, you should try to look for some professional help. There are many debt settlement companies that could help you, but you must be very careful in choosing one, as there are also many fraudulent companies on the market. Depending on the kind of debts you might have (secured or unsecured), the amounts or various interest rates and fees you pay on a monthly basis, the debt settlement companies’ representatives could help you reach financial relief in time.

If you are reticent about such a solution, you should keep in mind that debt settlement is not the same thing as debt consolidation, so it shall not have the negative effect debt consolidation might have on your finances (with regard to your credit rating or finance accessibility). Debt settlement could help you refinance your debt and change your payment schedule, whilst still being able to maintain your life style.

There may also be some negative effects when choosing debt settlement, as the fees such companies charge for their aid varies tremendously; some may only charge a initial administration fee, while others may have monthly fees that might create additional financial stress rather than relief.

Be careful and ask all necessary information in advance, including all amounts you will be charged with, and ask yourself if you are able to beard such additional burden. If the answer is no, perhaps the best solution for you would be debt consolidation after all.

Even so, you should be extra careful what company you choose to work with and what financial plan they offer you, as many companies could turn out to be scams. And since you already have financial difficulties, you really don’t need to pay even more than you already do.

This doesn’t mean of course that debt consolidation is not a good idea. The profile of debt consolidation companies allows them to negotiate reduced fees and interest rates on your debts, so you might actually end up paying less than you expected. Though, if you choose to work with such a company and choose one of their financial programs, this doesn’t mean you should relax and let them do all the work.

You must constantly check where your money go and what they are used for, as some companies choose to negotiate lower fees with your creditors but still charge you the same amount on a monthly basis, keeping that extra cash for themselves!

It is always difficult to find a convenient solution when you’re facing financial difficulties, but don’t get discouraged! If you are patient enough, there must be a good financial option for you on the market. You just need to find it!