dealing with debt

If you are in debt you are not alone. In today’s tough financial climate more people are struggling with debts than ever before.

The National Debt Line offers the following golden rules for managing debt.

Don’t ignore the problem or try to hide debts. It won’t go away and the longer you leave it, the worse it will get. There are many organisations that offer free debt advice

Don’t borrow more money to pay off your debts without thinking carefully. Always get advice first. If you own your home, borrowing against it could lead to you losing your home.

Do get professional advice and get on your way to being debt free.

Do If you have lost your job, or are off work because of illness, check whether your payments are covered by payment protection insurance. Check your credit agreement or contact the insurance company/lender to find out more.

Do Check you are claiming all the benefits and tax credits you are entitled to (see page 15)

Do Work out a personal budget. This identifies the money you have coming in, your outgoings and helps you to work out what you can afford to repay.

Do Contact everyone you owe money to. Explain your difficulties and show them your personal budget. You can use the sample letters at www.nationaldebtline.co.uk  If you make arrangements to pay some creditors but not others, you could run into difficulties again.

Do Make sure you tackle priority debts first – for example, debts which could mean losing your home or having your gas or electricity cut off.

Do Work out a reasonable offer to repay the money you owe. Don’t worry if it appears very small if that is really all you can afford. Creditors prefer you to pay a small amount regularly than make an offer you can’t keep.

Do If the first person you speak to is unhelpful; ask to speak to somebody more senior who may be able to agree to what you want. Don’t give up trying to reach an agreement even if creditors are difficult.

Do Fill in the reply forms to court papers and let the court have all the facts. The court will use this information to decide if you owe the money and what instalments you should pay.

Do Always go to court hearings. Take a copy of your personal budget with you. Don’t think that going to the court makes you a criminal; it’s not that kind of court, they will not send you to prison and there is no jury.

Do Always keep copies of any letters or court forms you send or receive.

Prioritising Debt

Priority debts are debts that can result in you losing your home, being sent to prison or losing essential goods and services. The priority of a debt is not determined by the amount of the debt, amount of arrears or the number of threatening letters you have received, but by the consequences of not paying.

All of the following debts should be considered as priorities:

• Rent and service charges
• Council tax
• Gas and electricity bills
• Maintenance and Child Support arrears
• Court fines and fixed penalty notices
• Car and home contents insuranced you know?

Did you know?

• Wulvern has a responsibility to collect your rent on time. We adopt a fair but firm approach to dealing with customers who are in rent arrears.
• We know that rent arrears often occur because customers on low incomes have other debts to meet. Our staff will be able to refer you to the Welfare Rights Advisor based at the Citizens Advice Bureau for advice.
• It is important that when we reach an agreement with you to clear the arrears, you stick to it. If the agreement is not kept and the arrears increase you risk loosing your home.
• We are here to help, if you are in rent arrears or are worried about paying your rent, please contact us immediately on 01270 503651.