People find themselves in debt for many reasons - for example;
poverty, loss of income, reduncancy, unemployment, illness,
relationship breakdown, death or the birth of a child.
Sometimes it may be simply due to over commitment.
What should you do if you find yourself in this situation?
Don't panic!
Don't ignore it!
Take a good look at your income and expenditure
- then consider:
Is there any way to reduce your expenditure?
Are you paying too much for insurance?
Are you using the cheapest method for paying your bills?
Steps you can take...
Step 1
Make a list of your debts.
Separate them into Emergency, Priority and Non Priority debts.
Write to the people you owe money to (creditors) and let them know you are having problems.
Pay your creditors what you can in the meantime.
Step 2
Complete a financial statement to work out if you have any money left after
you have made all your essential payments.
If you have money left over this is called ‘disposable income' and will be
used to help pay off your debts.
Step 3
If you have no disposable income, try not to worry. Speak to MLM Personal
solutions.
If you do have disposable income use this pack to assist you in contacting
your creditors with your offer of payments.
Start making the payments
Step 4
If your offer is not accepted please contact MLM Personal solutions
If your offer is accepted, continue making the agreed payments.
To use the self help pack please follow the steps over the following pages.
Types of Debt
It is important to identify the types of debt that you have.
There are 3 types -
Emergency Debt
Priority debt
Non priority debt
Emergency Debt - has serious consequences if ignored and must be dealt with immediately.
If your home is at risk of repossession, you are being evicted or having legal problems, this is an emergency situation.
Examples of Emergency Debt - Rent or Mortgage arrears, Council Tax arrears, Court summons, Wages arrestment, Bank account arrestment, Unpaid fines, Threat of bankruptcy. Priority debt has serious consequences if ignored. You could be at risk of losing essential services to your home or your car.
Examples of priority debts -
Missed Mortgage or Rent payments. (These may also be an emergency debt situation along with missed council tax payments), Unpaid Gas and Electric bills, unpaid bills for household goods and services e.g. telephone, Missed payments on a car or van etc.
Any debt left is classed as a non-priority debt. However please don't ignore them as non-payment can result in legal action.
Examples of Non Priority Debts - Catalogue debts, Credit cards, Store cards, Credit agreements, Debts to family / friends, Personal loans.
REMEMBER
If you are having problems paying any of these debts contact the department or company involved IMMEDIATELY - they are usually willing to negotiate.
What's next?
Contact Us - We can help