Debt Management Self Help Pack
If there isn’t a specific managed solution available to help you deal with your unsecured debts, there are lots of things you could do which might help you to increase your income and reduce your outgoings – this could give you more available funds to make repayments to your creditors.
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You could also liaise direct with your creditors to let them know of your situation and arrange to make reduced or token payments, set at a level you can afford.
Our guide provides invaluable step-by-step assistance for anyone who wants to set up an informal self-managed arrangement with their creditors.
This guide will help you review your income and expenditure, prepare your financial statement, and liaise directly with your creditors to make offers of repayment. Here’s a summary of what’s included in the guide…
– Make more of your money
Can you increase your income or reduce your monthly bills? Our Repayment Arrangement guide includes lots of handy hints to help you make the most of your money.
– Protect your bank account
If you have a credit card, overdraft or loan with the same bank or building society as your current or savings account, they can take funds out of your account to pay towards your debt, without your consent.
– Work out your monthly income and expenditure
Our guide includes handy tables to help you list all your income and expenditure, so you can fully assess your financial situation and work out how much money you have available each month to repay your unsecured creditors.
– List your priority and non-priority debts
Use our guide to learn the difference between priority and non-priority debts, and make a list of all your outstanding debts. Don’t worry if you’re not sure how much you owe – simply call your creditors to ask them, or write to them using this letter.
– Prepare your financial summary
The guide can help you put together a summary to demonstrate your financial situation to your creditors when you contact them with an offer of repayment.
– Things to consider
- It may take longer to pay off your final instalment
- If you’re paying less than the required monthly payment, your credit rating will be affected
– Contact your creditors
Read detailed guidance on how to work out how much to offer each creditor, and what evidence you need to send them. We’ve also prepared some suggested letter templates you could use to contact your creditors. Click on the links below to download them:
What happens next?
Once you’ve completed the Repayment Arrangement process and contacted your creditors, you’ve done the hard bit, and you’re on the right path. Even if you don’t hear back from your creditors, keep making the reduced repayments you’ve offered them. Sometimes a creditor might contact you to request an increase, but it’s important that you continue to make payments at an amount you know you can afford, after all your essential living costs and any priority payments have been taken care of.
It’s a good idea to update your creditors every few months. Staying in touch shows that you’re serious about dealing with your debts. If your financial circumstances improve, try to increase the repayment amounts.
We wish you all the best for the future.
Important note: As this type of self-managed arrangement is not legally binding, creditors do still have the right to commence action to recover debts, which may involve further cost to you. Also, there is no guarantee that any current recovery or legal action being taken by a creditor will be suspended or withdrawn.