I’m in the UK. Is There Any Way I Can Get Out of Debt Without Paying a Fortune for Help? – Dean
June 6, 2009
Dean wrote to me through the GetOutOfDebt.org site and asked the following question. If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.
Income from the GetOutOfDebt.org site advertising is used to help alleviate poverty. If you would like to help me to help others, there are easy and free things you can do, click here to learn how you can help.
“Dear Steve,
I have 2 credit cards and 2 loans totalling almost £52000, i am struggling to make my monthly repayments as the interest is crippling, one of my credit cards has recently been handed to a debt recovery agency which has helped a little as the interest on that has now been abolished. but i am still struggling to make my monthly repayments and be able to live. i recently spoke to a debt management company who wanted me to pay them 300 pounds a month for 2 months then they would contact all my lenders to see if i could get my repayments lowered. they said 300 a month would cover all of my debts but they would be taking 57 pounds of that every month for 150 months, but i don’t really want to be in debt for 150 months and paying someone 600 pounds then 57 a month for 150 months.
Is there a way i can lower my monthly repayments without paying someone a fortune to help me?
Dean”
Steve’s Answer:
Dear Dean,
The debt assistance marketplace in the UK allows for all types of debt management companies to assist you. The two debt elimination options that are legally binding on your creditors are the Individual Voluntary Arrangement (IVA) and bankruptcy. You can learn more about these options and get help with them here. An IVA is paid for by the creditors and will last for up to 60 months and a bankruptcy will discharge your debt and will be over in about 9 months.
Other options that are available include working with a debt management company (DMC) or visiting Citizens Advice for free help.
DMCs are for the most part for-profit groups in the UK. These groups will charge a fee for the service they deliver to you. In your case it looks like £57 per month.
I agree with you, 150 months of debt repayments through a debt management company seems like an awful and excessive long period of time to be in a debt management plan.
Source: I’m in the UK. Is There Any Way I Can Get Out of Debt Without Paying a Fortune for Help? – Dean
Other Related Articles to Read
Tags: bankruptcy, bankruptcy petition, individual voluntary arrangement, iva
My advice would be call a debt charity like the Debt Advice Foundation, Citizens Advice or CCCS. There a few solutions to help, they are all different and it’s important to get the right one from the right organisation.
[Reply to This Comment]