What to Do If you Can’t Afford To Pay Your Debts

Debt Help
Image courtesy of Salvatore Vuono / FreeDigitalPhotos.net

If you are burdened by the weight of debt, you should take some comfort in knowing that you are not alone. Thousands of people in the UK have succumbed to the spectre of debt due to rising costs of living and the drying up of traditional forms of credit.

People who can’t pay payday loans are often forced to turn to other lenders to pay off existing liabilities, and they quickly get sucked into a spiralling cycle of debt.

However, thousands of people are seeking professional debt help from specialists with years’ of experience in the field, and they are learning that breaking free from their financial chains is achievable with discipline, negotiation and planning.

Admitting the Problem

It is common for people struggling with debt to shroud themselves in denial. If you simply don’t have enough money to repay your monthly debt commitments, it is inevitable that the problem will get worse without proper attention. Admitting the problem and taking action is the first step to securing your financial future.

Assessing the Situation

Collate all of your monthly outgoings and income, and you will be left with your monthly disposable income. This is the maximum sum you can reasonably expect to use for the repayment of your debts, and it can be used to argue your case with creditors.

Starting a Dialogue

Many consumers are surprised to discover that lenders are willing to discuss repayment difficulties, as banks and payday loan companies have a far better chance of recouping their money if the situation is dealt with out of court. In some cases, creditors will agree to a change in the repayment schedule and the freezing of interest.

Changing Your Spending Habits

The repayment of debt requires financial discipline, so you will need to reduce expenditure on luxuries to a minimum. Set budgets for essential expenses such as grocery shopping and utilities; install electric, gas and water meters. Change you approach to cash, and make the repayment of your debts your number one priority.

Keep the Lines of Communication Open

Life can throw people a curve ball when they least expect it. A broken down boiler or an urgent car repair can take people by surprise. However, by simply informing creditors that payments could be late, they are more likely to make allowances than in situations where they are left in the dark. Staying on good terms with creditors is the best way to avoid legal proceedings.

Seek Expert Advice

Seeking help with debts does not have to be an admission of failure; in fact, it’s quite the opposite. A debt advisor will work on your behalf to reduce your monthly repayments, freeze your interest charges and improve your financial planning skills. Where tough talking is required, an advisor will give you the plain facts.

If the chances of agreement with creditors are slim, debt help specialists will explain your options carefully. The advice could be payday loan debt consolidation in the form of a further loan, but only if that is in the best interests of the client. It could be bankruptcy if all other avenues have been exhausted. A debt advisor’s impartial help will ensure that debtors take the best possible course of action for their particular circumstances.

Living with debt can affect every facet of a person’s life, and it can also have devastating effect on a person’s future. By asking for specialist help, people can find the advice and support to live a financially independent life.

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