Debt advice handbook – introduction

There are millions of people in the UK who are struggling with debt in some way, so you are not alone. There is no need to be embarrassed or hard on yourself, what matters is that you do something to improve your situation.

These pages have lots of information, but don’t be put off as you won’t need to read all of it depending on your situation. It will help you to manage your own budget and see what options you have to improve your situation.

There are sections to work through:

  • Create your budget
  • Increasing your income
  • Reducing your outgoings
  • Reviewing your debt options
  • Contacting your creditors

Before You Get Started

Do you have any debts that need urgent action?

If you are at immediate risk of losing your home or essential goods or services, you should get more help straight away from an advice organisation.

Examples of where urgent action is needed are if you have been:

  • Threatened with eviction
  • Contacted by Enforcement Agents (Bailiffs) who are collecting a debt
  • Told your gas and/or electricity supply is going to be disconnected
  • Threatened with bankruptcy

Do you have any debts you’ve not had contact with for several years?

If you haven’t written to a creditor or made a payment towards a debt for several years, you should receive advice before you do. This is because the debt may be ‘statute barred’ and legally unenforceable, meaning you might not need to pay it.

Do you owe money to a loan shark?

A loan shark is someone who lends money but doesn’t have a legal licence to do so. There can be little or no paperwork to tell you about any interest rate or amount you owe, and you may not be allowed to settle your debt. Sometimes items are taken from you as security (e.g. passports or driving licences), or the person you owe money to might try to intimidate you, make threats or become violent. More information on how to deal with loan sharks.

Basic Advice

  • Do not panic. If you are struggling, get help straight away. You are not alone, you can get advice at any time, and it’s never too late.
  •  Do not ignore your debt problems. They will not go away but can be resolved.
  • Claim all the benefits and Tax Credits you are entitled to receive.
  • Do not borrow money to pay off your debts. Borrowing like this can easily make your situation worse, always get advice first.
  • Do not ignore creditors. Open and keep letters/emails you receive so you know what’s happening, you will then be able to do something about it.
  • Deal with all your creditors. If you miss any creditors, you could run into difficulties again.
  • Do not give up. If a creditor doesn’t agree to your request the first time, try again and get advice.