When should you seek expert help for your debts?

Written by Chelsea Potter on 21 November 2016

If you’re struggling with your finances, it can be difficult to know where to turn. Do you contact your creditors and tell them you simply cannot afford the repayments, do you ask a loved one for help, do you ignore the post and hope it goes away, do you look further afield and turn to an expert? At what point do you ask for help – when you’ve missed your first payment, got your first default notice or when a bailiff turns up at the door?  Being in debt is confusing and quite often overwhelming which is why this week’s blog aims to make things a little clearer, looking at what you can do if you find yourself in debt.

What to do and when?

You might have to miss a payment/ you’ve missed your first payment

If you’ve missed a payment or feel like you’re about to miss a payment, you need to contact your creditor as soon as possible. Getting in touch with them and explaining your situation could prevent them recording a default against you, which will impact your credit rating. Talk to them and try and arrange an alternative solution if you’re struggling to make ends meet.

At the same time you need to look at why you can’t afford to pay everything. Have you got too much expenditure, is there something you can cut back on, are you not earning enough? Look at your finances and highlight the problem.

You have a bailiff at your door

A bailiff is not a debt collector. The latter has no rights to enter your home and force payment but a bailiff is instructed by the courts to visit your home to collect the money you owe. You can refuse entry and while they can’t force entry on their first visit, they can use ‘peaceful means’ after so do not leave doors open or unlocked. You should always receive at least 7 days’ notice if a county court bailiff is coming so once you have instruction get in touch with your creditor and come to some sort of payment arrangement. If a bailiff is at your door the first time, tell them they can’t come in and you will be getting in touch with the creditor to arrange payment. You should then seek advice from a debt adviser.

You have a CCJ

A CCJ is a county court judgement so you will need to respond to the court forms, either admitting liability to the debt and asking for time to pay or disputing it. If you accept liability you will then be asked to make repayments towards your debt. You can explain to them how much you can afford to pay. It is important you stick to this agreement because the creditor can enforce this further with either an attachment of earnings order or sending the bailiffs to your home. A CCJ will impact your credit rating and will sit on your file for six years.

You have a default notice

Default notices are issued after missed payments and involve a letter from your creditors. If you receive a default notice you should either arrange payment for the full amount you owe immediately or arrange a repayment agreement with them. If you ignore the default your creditors can take legal action against you.  A default notice will also sit on your credit file for six years.

What help is available?

  • Debt solutions – There are debt solutions available to help you regain control of your finances. If you’re really struggling and can’t see a way out, a debt solution can help you. Talk to a debt adviser about the options available and they will make a recommendation and support you in setting up a solution.
  • DIY debt plan – Have a look at your finances yourself and work out what you have going out and what you have coming in. If you have surplus available after your household bills, why not work out how much you can afford to repay your creditors and try and negotiate a new arrangement with them.
  • Online tools – There are plenty of money saving tips and budget guidelines online to help you reorganise your finances. Have a search and see whether any of those tips can help you. Sometimes reorganising your finances and creating your own budget is enough to help you get back on track.
  • Your personal options – do you have savings you could use to help you get back on track or a second car you could sell to raise some funds for your creditors? Could you make cutbacks in some way – perhaps by getting rid of a gym membership you no longer use, going out for dinner less or by shopping at a cheaper supermarket? Have a look at your finances and work out whether there is any simple solution to help you get back on your feet. There might not be but some people do have the ability to sort out their situation quickly.
  • Family support – Do you have a partner or family member able to help you? A lot of people want to sort out their debts themselves and so they keep it quiet from their partners and families. That’s fine but debt is a burden and sometimes sharing the load can make you feel a lot better. Family members are sometimes also able to help and borrowing money off a partner or parent means you can instantly get out of debt and you won’t have to worry about interest rates while you repay them.

How PayPlan can help you

PayPlan are a free debt advice company with expert advisers on hand to make recommendations on a wide range of debt solutions. Our advisers are fully qualified and experienced in the industry and have helped many people like you regain control of their finances. You can contact us by web form or by calling our freephone number 0800 280 2816. Our advisers will look at your income and expenditure, discuss your budget and highlight what options you have. They will make a recommendation to help you find your feet and assist you throughout the next steps.


Filed under Living in Debt

This article was checked and deemed to be correct as at the above publication date, but please be aware that some things may have changed between then and now. So please don't rely on any of this information as a statement of fact, especially if the article was published some time ago.

Please Post Your Comments & Reviews

Your email address will not be published. Required fields are marked *

*
*