We would always advise that you deal with your debt problems sooner rather than later. Things can spiral out of control quickly until the debt becomes all consuming, but there are many options out there for what may seem the bleakest of situations. Knowing where to find the right help can get you back on track financially and put an end to those sleepless nights.

There are a few things you can do to check to see if you are overstretching and help to beat the debt, whether it be simply cutting back, or seeking help for a debt solution.

1. Review your financial situation

Sounds obvious right? Getting as much of your financial information is key. You may well have had outstanding bills that long that you could have forgotten about some. Don’t worry about that to start with. Grab what you do know about and assess what is owed so you can determine whether this is something you can deal with yourself or whether you need to seek help from a professional.

Make a budget

Use a budget planner like the one kindly provided by Money Advice Service to determine your incomings and outgoings so you have a clear picture of where you stand financially. If you prefer you can talk to one of our qualified advisors on 0161 976 9888 who would be happy to help talk you through your income and expenditure and point you in the right direction.

Check your credit file

Use a free service such as Noddle to get a copy of your credit file. Make sure it is up to date and there are no mistakes on there. Your credit file is information held by the Credit Reference Agencies that documents all your credit agreements and should be updated regularly by your lenders. If you have fallen behind on your bills or have any County Court Judgements (CCJs) this will show on your credit file and could affect your ability to obtain further credit.

2. Tackle your debts

Deal with priority debts first

If alarm bells are ringing after you’ve completed your budget plan then it is absolutely vital that you know which debts to prioritise. BIlls that keep the roof over your head such as your mortgage and rent should always come first as it can mean losing your home through repossession or eviction.

Priority debt list

  • Your mortgage or any loan secured against your home
  • Council tax, National Insurance, tax and VAT
  • TV license
  • Utilities – Gas, electric and water
  • Court fines, CCJs and Child Maintenance
  • Hire Purchase agreements

If you’re worried that you cannot afford to pay the debts on your priority list tell lenders straight away. If you prefer call us on 0161 976 9888 and we can help to point you in the right direction.

Look at ways you can save money

If you think you are able to get your finances back with some careful budgeting, read my top tips here.

Cut back on credit  

Check your budget planner and bank statements carefully. If you’re starting to pay for things on credit you used to pay cash for you could be overstretching and may be just storing up a problem for later. Transfer existing credit balances to another company offering an interest free period. This way you will be attacking the debt and not just the interest charges.

3. Check what help you’re entitled to

You could be entitled to more help financially. Check this website to make sure.

Tax credits and benefits

Information on Income Support, Working Family Tax Credits or Jobseekers Allowance is available on www.directgov.co.uk. For details on benefits go to www.hmrc.gov.uk, or visit www.entitledto.com for more information on tax credits.

Rent/council tax

For details on any help available with rent or Council Tax contact your local council.

Credit Insurance

Find out whether you have payment protection insurance on your mortgage, loans or credit cards as you may be able to claim if you’re unemployed or unable to work through illness.

4. Open a separate bills account

By setting up all your direct debits to come out of a separate account you’re able to clearly distinguish what you really have left to spend over the month. There is nothing worse than checking your bank expecting there to be money left only to realise a bill has swallowed it up and left you short. Worse still, noticing that a bill has gone unpaid and you’ve been left with an unnecessary missed direct debit charge.

All accounts with high street banks will require a credit check that can have a slight dip on your credit score. If you want to avoid this you could always opt for a prepaid account. Some of these accounts can even help improve your credit rating as you’re using them and have no credit checks. I would recommend ICOUNT Money for this, there is a quick an easy 2 minute application form and you’re away.

5. Seek professional debt advice and help

It can seem a daunting task trying to find the right debt solution especially when there are so many of them out there. Speak to somebody who can help advise you and get you the help you need. We pride ourselves on the personal touch, our advice jargon free and we take care to make sure you fully understand the process from  start to finish. Give us a call on 0161 976 9888 today and let us help take away the stress and worry of debt.   

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