If you’re behind with payment and have received a notice of arrears here’s some important information which you’ll hopefully find useful to help start to sort things out.
Firstly and most importantly don’t ignore the problem, be proactive in establishing your exact position by:
Working out how much money it is that you owe.
- To do this, take the time to make a list of all the organisations to whom you owe money to. A debt adviser can help you with this.
Contact the organisations you owe money to.
- As soon as possible let them know that you are experiencing problems, as they may be able to discuss a number of options for paying back what you owe
Get free help and advise.
- As your rights and options may well depend on the type of agreement you have, plus the law can be complex. So there are a number of independents organisations that can help.
Put priority debts first.
- You may not realise but some debts are more urgent than others because the consequences of not paying them can be more serious than for other debts. An example of these would be a mortgage, rent, council tax and gas and/or electricity arrears. A debt advisor would be able to help you to budget therefore keeping your finances under control.
Think carefully before borrowing money to repay debts.
- Get advice before borrowing against your home as you will pay more in the long run and risk losing your home.
You may be able to ask a court for more time to repay a debt.
- This is only something which may apply in only some circumstances, so speak to a debt adviser before considering court action as a way to deal with the debt. It’s always a good idea to keep copies of letters and emails especially if they are ever needed by the court.
IMPORTANT TO REMEMBER – If you do nothing whatsoever it will undoubtedly make things worse as the lender could take legal action against you meaning you could end up paying more interest and charges. Missed payments could affect your credit rating and make it more difficult to get credit in the future.