Having a lot of problem debt can be stressful and scary. However, the good news is that there is help and support available to tackle debt. Getting debt advice could help you pay off what you owe quickly and avoid making your financial situation worse. Here is how to find the best places to get help with your debts.
If you find yourself struggling with debt and feel that it is unmanageable, you could benefit from seeking debt help to get on top of your finances.
There is no minimum amount or maximum amount of debt required to seek help; some people can manage large amounts of debt without too much difficulty, whereas others find it challenging to manage smaller amounts of debt.
The good news is that there are a number of debt charities who support individuals struggling to manage and repay debt.
These charities provide free support, in contrast to financial advisers and debt management companies who charge for their services. If you already have debt, paying for these services could make your debt problems worse.
You can find free help from debt charities including:
Citizens Advice can provide free help in person or by phone
StepChange Debt Charity can provide advice or a free debt management plan (DMP)
National Debtline can offer free advice by phone and help you set up a free DMP
PayPlan is an independent provider of free DMPs
Shelter is a housing charity that can provide advice by phone, online or in person
Christians Against Poverty can visit you at home to give advice and help you budget
Even if the first debt charity you contact is not able to provide the support you need, you can ask for a referral to another organisation who may be more suitable for your circumstances.
There are many benefits to seeking debt help from a charity or organisation experienced in debt management. Getting debt advice can help you to:
Prioritise your debts so that you can tackle them head on
Set a realistic budget that you can stick to
Plan how you will pay off your debts, exploring different debt management options
Communicate with your creditors and help them understand your current situation
By speaking to a debt charity or adviser, you can also access Breathing Space, a government scheme introduced in 2021 to help individuals with debt.
Breathing space gives an individual in problem debt the right to legal protection from creditors for up to 60 days, and freezes most interest and charges on the debt during the Breathing Space period.
Depending on your financial circumstances, you may need to hire a debt management specialist. However, it is worth talking to a debt charity for free first to see if they can help you clear your debts without having to pay fees.
It can be daunting to face up to your financial situation, but it’s important to know where you stand before you look for help from a debt charity or organisation. Ahead of reaching out for debt help, make a list of:
How much you owe: Contact each lender to ask for the outstanding balance on each loan, credit card or form of borrowing and any relevant terms
The interest rate and how much you repay each month: Ask each lender to confirm the interest rate on any debt you owe, along with the minimum repayment amounts
Any income you earn: Check your payslip or online banking statements to get an accurate picture of your income every month from all sources
The bills you need to pay each month: Check your bank statements or your bills to understand your essential expenses each month
This will help you work out how much you owe and which debts you need to pay off first. You will also be able to give a clear picture of your financial situation to an adviser if you get help.
If you are struggling to keep up with repayments and likely to miss any, let your lenders know as soon as possible.
If you explain your situation and that you are willing to work with them, they may be able to help.
For example, they could freeze your interest for a while or give you a repayment plan you can afford and more time to repay what you owe.
If you do not tell them, they may assume you have decided not to pay them back, so they could try to recover what you owe through a third party like a debt collector.
However, if you decide to get debt help, your adviser or charity may be able to contact your creditors for you.
When you speak to a debt adviser, they may suggest a number of different debt solutions for tackling problem debt. Routes that may be suggested include:
Administration orders that let you pay back debts through a monthly payment made through the courts, which decide how much you pay based on your income.
Individual voluntary arrangements (IVAs) are agreed through the courts and let you make a monthly contribution from your income, which is divided between your creditors.
Debt management plans (DMPs) are an arrangement with your creditors to define how much you will repay each month.
Bankruptcy could be recommended as a last resort. Here is how bankruptcy works and how to declare yourself bankrupt.
You can find out more about each option from GOV.UK's guide to paying off debts.
If a lender tries to collect money you owe them, there are rules and laws that protect you. It is important to know how to handle debt collectors to ensure that you aren’t misled or intimidated.
There are clear rules dictating how debt collectors must behave - for example, they cannot threaten you with jail or bother you at work - however they don’t always stay within their boundaries.