What are your options to clear your debts?

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People borrow money for a variety of reasons. They may be refurnishing their home, the washing machine may have packed up and they need a new one, or they may need to finance a laptop or new car; meanwhile, credit cards are useful for buying goods and services online. At times, however, it may seem as though your debts are getting out of control or you want to cut down on your monthly repayments. Once you have refurbished you could look at moving house to get lower payments on your mortgage but before you do anything perhaps get some Conveyancing Quotes from local business like https://www.samconveyancing.co.uk/conveyancing-quote.

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There are several ways in which you can reduce your debts to make them more manageable. This could mean cutting back on some non-essential items for a while so that you can pay off your credit card or other loans. You may want to make a more formal arrangement, in which case you can contact an advisor to help you to set up a debt plan to suit you.

Ways to manage debt

You may want to set up a debt management plan (DMP), which means you make just one monthly payment to your DMP provider. A DMP provider will work out an affordable payment with you and talk to your creditors on your behalf. These are suitable for sorting out credit or store cards, overdrafts or personal loans.

For people on a low income with few assets, it may be possible to set up a debt relief order (DRO). This means the debt is frozen for a year and can then be written off if you are still unable to pay it back.

An advisor can also help you to set up an individual voluntary arrangement (IVA). This is where you pay back what you can afford over a set amount of time. Another course of action could be to declare yourself bankrupt, which means all debts are written off; however, any assets you have may be used first.

Financing a large purchase

You may need to pay for an expensive item such as a car but cannot afford to buy it outright, in which case you may consider taking out a loan. Even if you have a poor credit rating, you may still be eligible;
Of course, it is vital to make sure you can afford the monthly loan repayments on top of your existing financial commitments.