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Tackling your debts

Do you have a drawer of unopened letters from lenders?

Posted 21 December 2016

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Facing your debt problems head on might not be as scary as you think. There’s lots of help available.

Every now and again you can start to notice warning signs that something might not be quite right with a certain aspect of your life, and your finances are no different. If you have a drawer of unopened letters from lenders at home, either because you can’t bring yourself to read them or because you think you’ll deal with it later, this is a warning sign that your debts are starting to become unmanageable.


The fear of opening letters from lenders

If you know you can’t pay your debts, opening letters which are going to ask you to do just that is probably the last thing you feel like doing. It can be easier sometimes to throw them in a drawer and pretend the problem doesn’t exist.

However, the truth of the matter is that this will only make the situation worse. The longer your debts go unpaid the more severe the action your creditors will take to try to get the money back. If left long enough, this situation can lead to them trying to get a County Court judgement (CCJ). This is a court order which outlines exactly when and how you have to pay the money back.


What you need to do

Understanding the situation you’re in is half the battle. That’s why it’s so important to open all those letters and get a grasp of how much you owe and to who.

We’d recommend putting an hour or two aside, and opening each one. Make a list of all your lenders and how much you owe each one. This may seem very scary, but remember – there’s lots of debt help out there.

After you’ve opened all those letters, you won’t be left alone to deal with the problem. There are various debt charities that offer help and The Money Advice Service is a free and impartial resource set up by the Government to help people with all sorts of money problems.

Our advisors are also on hand to talk to about your debts problems. They are experts on all the different debt solutions available and can tell you which one is right for you.


Stay in contact with your lenders

You should stay in contact with your lenders. Give them a ring, let them know you’ve received their letters, that you are in financial difficulties but that you want to pay back what you owe at a rate that you can afford. This is very important, and in a lot of cases can stop the problem from becoming too severe. You might find that your creditors are more understanding than you think.

Explain why you can’t keep up with the contractual payments at the moment. If you’ve put a budget together that shows what you can afford to put towards your debts, it might be a good idea to send this to them, so they can see what you can realistically manage to pay them. They may agree to suspend your payments for a while, lower them for a bit or freeze interest and charges.

If you don’t want to speak to your lenders for whatever reason, or you don’t get anywhere when you do, you should seek advice from independent debt experts. Just scroll down to the bottom of the page and you’ll see options for contacting our fully trained advisors.


Debt solutions

You may have heard of debt solutions before without ever really looking into them properly or knowing how they work. They are simply plans that help you with your debts if you find you can no longer afford your contractual payments.

There’s a range available and which one is right for you will depend very much on your circumstances. There are some that suspend your payments altogether, some that just lower what you pay, and some that lower your payments and provide debt write-off at the end.


The mental toll of debt

As the pile of unopened letters grows, you may find that your worry and anxiety grows with it. You can put a stop to those feelings by taking control of the situation, opening those letters, speaking to an expert and putting a plan in place to deal with your debts.

If you want to know more about how we work before you pick up the phone, you can get to know our advisors with our previous blog.

If you’ve been worried about debt for a long time, this might have had an effect on your mental and physical wellbeing. It’s really important to remember to look after yourself as you’re dealing with your debts . And remember, no matter how daunting the contents of your letters may seem, there will always be a way to deal with your debts.

by Christine Walsh

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To find out more about managing your money and getting free debt advice, visit Money Advice Service, an independent service set up to help people manage their money.