If you’re struggling to pay off your debt, then seeking advice from a debt charity is definitely worth a shot.
There are a number of independent debt charities currently operating in the UK with professionals that will provide you with free and impartial debt advice.
Today, I’ll be discussing how you can approach these debt charities to get help with your debt problems as well as some things you should keep in mind when seeking debt advice.
Independent Debt Charities Operating in the UK
Private debt management companies and financial advisers typically charge for their services and advice.
Seeking debt advice from an agency that charges you for their services when you’re already having financial problems is obviously a bad idea.
This is why, if you need advice on how to handle your debts, your best bet is to contact an independent charity.
Examples of some debt charities currently operating in the UK are:
- Citizens Advice Bureau. They can provide you with free debt help both in person as well as on the phone. You can go to their website to learn more information on how to pay back your debt or get it written off.
- Stepchange Debt Charity. You can learn a ton of information about how to address your debts on their website and they can also provide you with free debt advice. If you need a debt management plan (DMP) set up, they can do that for you for free too.
- National Debtline is an organisation that can help with free debt advice on the phone and they can also help you set up your debt management plan (DMP) for free.
- Payplan is a great charity and an independent provider of DMPs. They won’t charge you to set up your debt management plan.
- Shelter is a charity that primarily provides housing but can also provide you with free debt advice online, via phone or in person.
- Christians Against Poverty is a charity with professionals that can visit you at your residence to give you debt advice and they can also help you organise your budget.
Why Should I Seek Debt Advice from a Charity?
It can be a good idea to seek debt advice from a charity regardless of the fact that if you’re struggling with your debt or not.
Even if you feel that you have your debt repayments under control, a debt professional may be able to point out some steps you can take to reduce the amount of money you have to pay back.
If you’re struggling with debt repayments in the first place, then a debt professional can help you providing you with options on how to manage your debt.
Not only will they provide you with options on how to take control of your debt but they will help you set up whatever debt solution you choose as well.
For example, if you choose to opt for a DMP, then the charity will help you plan a budget for yourself and they’ll also negotiate with your creditors on your behalf.
Once your DMP is put in place, you’ll have little to no contact with your creditors as the charity will be the one who will be primarily responsible for dealing with them.
Furthermore, they would do all of this free of charge.
Charities can also help you out with:
Prioritising Debts and Distributing Payments
You may not be aware of how you need to prioritise your debt repayments. By prioritising, I mean, determining which creditors you should pay off first and which ones should be paid later.
This can definitely get confusing if you have many different types of debt.
Prioritising between different unsecured debt(s) can be especially tricky since you have to calculate the interest rates in order to determine the one with the highest interest rate so you can pay that one off first.
On the other hand, if your payments are part of a DMP, then they have to be paid according to what you owe each creditor.
For example, if you owe a creditor 50% of your total debt, then that creditor will receive 50% of your monthly payment each month.
This is something that you won’t have to worry about if you avail the services of a charity.
As part of your DMP, you’d only have to make a single payment to the charity and it would be the charity’s responsibility to distribute your payment appropriately among your creditors.
Providing Information on Debt Solutions
There are a number of different debt solutions available in the UK such as Individual Voluntary Arrangements (IVAs), Bankruptcy, Debt Relief Orders (DROs) and ‘Full and Final’ Settlement offers.
While all of them serve to help you deal with your debt, not all of them are suited for every financial situation.
A debt solution that works perfectly for you may be disastrous for someone else.
This is why, if you’re thinking about opting for a debt solution, it can be a good idea to seek debt advice from a charity first.
They have trained professionals that will assess your financial circumstances thoroughly and give you advice on which debt solution would be most appropriate for you.
What Are Some Things to Keep in Mind when Seeking Debt Advice from a Debt Charity?
Some things you should always keep in mind when seeking debt advice from a charity are:
- Ensure that the professional helping you is qualified to be giving you debt advice. They must be authorised and regulated by the Financial Conduct Authority (FCA).
- Make sure to ask a lot of questions and ask the professional to repeat himself/herself if you don’t understand something.
- Take notes so you have a complete record of what was said during the meeting.
- Ensure that any personal information you provide is kept confidential by the organisation.
Debt charities in the UK are doing a wonderful job of providing free advice to debtors.
Not only will they provide you with advice on how to get out of debt but it will be advice on how to get out of debt as efficiently and quickly as possible.