Seek help straight away for debts

Seek help straight away if you are struggling with debts, says Ceredigion Citizens Advice

More people in Ceredigion struggling with unmanageable debts are turning to Ceredigion Citizens Advice, leading the charity to call for people to seek help before they reach crisis point.

Nationally, more people have been helped with a debt relief order (DRO) since the amount of debt covered rose from £15,000 to £20,000 last October.

Debt relief orders are a last resort for people who have exhausted all options for repaying their debts and won’t be able to pay in the near future.

They work by pausing most of your debts for a year so that your creditors can’t chase you for repayment. At the end of the year, unless your circumstances change your debts will be written off.

Debt write offs can have a serious impact on people’s credit rating which makes it difficult to take out more credit agreements or even open a new bank account.

Ceredigion Citizens Advice is now urging people who are struggling to keep on top of their debts to seek advice early on, so they have the best chance of repaying their debts and avoiding debt write-offs.

Piers Heneker, Senior Caseworker at Ceredigion Citizens Advice said:

If your finances are getting on top of you and you’re struggling to pay your debts it’s crucial you seek support right away.

Ceredigion Citizens Advice can help you work out what you can afford to repay, and negotiate with your creditors on how you will pay them.

We can also offer advice on how you might be able to make savings, such as switching to a cheaper energy deal or mobile phone provider.

For advice on managing debts, contact Ceredigion Citizens Advice on 01239 622020.

 

Ceredigion Citizens Advice guide to sorting out your debts
1. Work out how much you owe - make a list of the companies you owe money to, and add up how much you need to pay each month. If you don’t have your most recent statements, contact the company to find out what you owe.
2. Identify your priority debts - your rent or mortgage, gas and electricity and council tax are called priority debts as there can be serious consequences if you don’t pay them. These should always be paid first. Separate these out and work out how much you owe to each.
3. Work out how much you can pay - Create a budget by adding up all your essential living costs like food and housing, and taking these away from your income. Any money you have spare can be put towards your debts. The Citizens Advice budgeting tool can help.
4. Paying urgent debts - You may have several priority debts and can’t pay them all. Contact all your creditors to find out if you can negotiate on how much you pay, or when you pay them. You will get an impression of who needs paying now, and who is prepared to wait. Always pay creditors who are taking action against you first.
5. Paying non-urgent debts - If you have any money left over after paying priority debts, you could consider getting a free debt management plan. You’ll make one monthly payment to the plan provider, who will handle paying your creditors. Alternatively, contact your creditors and offer them what you can afford to pay.
6. If you can’t pay your debts - check your outgoings and see if you can make savings:

● Switch energy suppliers - switching energy suppliers can save you hundreds. To work out if you’re on the best deal or can get a better one elsewhere, use the free Citizens Advice energy comparison tool or contact Ceredigion Citizens Advice Energy Best Deal team.
● Check your broadband and mobile phone deals - if you’re near the end of your contract, see if you can find a cheaper provider
● Get a water meter - smaller households may be able to save money by moving to a water meter. With a meter, you only pay for what you use. Work out if you could save by visiting www.ccwater.org.uk.