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| The independent answer to your debt problems | login join |
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rocky53
| 18-05-2008 07:32 PM |
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Joined: 18 May 2008 Posts: 1 | Got a considerable debt in loans and cards no equity in the house don't want the restrictions with an IVA but want to lower my outgoings payments have I got an alternative ? |
| DW George | 19-05-2008 09:59 AM |
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Joined: 01 May 2007 Posts: 174 My Profile | Hi Rocky You do have alternatives. First alternative is a debt management plan. A DMP is an arrangement between you and your creditors to break your contract with them and lower your monthly payment. Hopefully the creditor may freeze the interest, if they don't the interest will just add on to your debt. DMP's can be either arranged by yourself (see here for debt management template letters) or through a debt management company. DMP' are really only a short term solution and will impact on your credit score in much the same way as a IVA pr PTD. The other alternative is debt consolidation. Debt consolidation involves bringing all your debts together using one cheaper loan, reducing your monthly payments. The loan can either be unsecured, (credit card or personal loan) or secured (on a property or car). Debt consolidation can be a good debt management strategy but due to the lower monthly payments it can give a false impression about the manageability of your debt. Therefore before you take out a loan it is essential to ensure that you have control of spending. If you don't you will just make matters worse. A debt consolidation loan won't have a negative impact on your credit score. Rocky what I suggest you do is fill out an Statement of Affairs (SOA) make it visible for all to see and we will take a look at your spending and suggest what would be the best way to deal with your debts. The answer may be just to change your attitudes to spending or it may be one of the above. In any case filling in an SOA is a good reality check which will highlight areas where you could save. Speak to you later George |
