Directgov on debt advice

http://www.direct.gov.uk/en/moneytaxandbenefits/managingdebt/planyourwayoutofdebt/dg_10023185

Money, tax and benefits

Debt repayment options - a guide

If you're struggling with debts, they may seem impossible to manage. However, there are ways to get out of debt, no matter how bad the situation seems. There’s also plenty of free and independent advice available to help you manage your debt problem.

Facing up to your debt problem

Almost everyone owes money - bills are a fact of life. But sometimes you may find you are swamped with debts and can't see a way of paying them all. The worst thing you can do is to ignore the problem - it won't just go away.

Getting debt advice

You can get free and independent advice to help you deal with your debt problem from organisations like Citizens Advice and the National Debtline.

• Debt - where to get free help and advice

Making the most of your money

If you're in debt, work out a realistic personal budget so you know where your money's going - and how much you can afford to pay your creditors (people you owe money to).
If you don't have enough money to pay off your debts, look at ways of cutting your costs and increasing your income.

Cutting your costs

You can look at your expenses to see where you can make savings. You could also try shopping around to reduce bills, or think about selling non-essential items that you own (for example, a second car).

Increasing your income

You may be in debt because you're not receiving all the money you're entitled to. For example:

• make sure you're not paying too much tax
• check if you're entitled to tax credits
• make sure you're getting the benefits you're entitled to
• make sure that any family and friends living with you are paying enough towards household expenses
• think about renting out a spare room to a lodger
• check if your mortgage payments are covered by insurance

• How to find out if you qualify for benefits

• Read more about increasing your income from National Debtline (PDF, 47K) Opens new window

• Help with PDF files

Ways of repaying your debts

There are many ways to repay your debts. You can get free and independent debt advice online and face to face to help you find the best way to deal with your debt problem.
This includes advice on what restrictions and responsibilities you have to agree to and how different repayment options affect things like:

• your credit rating
• your home – for example, if it is still at risk of being sold to pay your debts
• what action your creditors can take to recover their money - for example, taking you to court to make you bankrupt

Informal arrangements

An informal arrangement is where you agree with your creditors to make regular payments towards your debts over a period of time.

• Informal arrangements - ways out of debt

Individual voluntary arrangements (IVAs)

Individual voluntary arrangements are formal agreements with your creditors to pay all or part of your debts over a period of time. They have to be set up by an authorised debt specialist and there are certain costs you need to pay.

• Individual voluntary arrangements (IVAs) - ways out of debt

Debt management companies (DMCs)

DMCs offer help if you're in debt (they usually only deal with non-priority debts - see the link 'Find out more about non-priority debts' below). They negotiate with your creditors on your behalf to reduce the payments you are making overall. You then make one payment to the DMC, which distributes it to your creditors.
Most DMCs charge a fee, so you may have less money from your available income to settle your debts. However, organisations like the National Debtline and Consumer Credit Counselling Service (CCCS)  offer free debt management plans.

• Find out more about non-priority debts

• Debt management plans - ways out of debt

Administration Orders

An Administration Order can help you deal with your debts if they are £5,000 or less and you can can afford to make regular payments to your creditors. You have to apply for an Administration Order through your local county court and there are certain costs and conditions you need to meet.

• Administration Orders - ways out of debt

Bankruptcy

When you are made bankrupt, a person called a ‘trustee’ is appointed to take control of your assets (possessions, home, spare income etc) and sell or use them to help pay your debts. Your financial affairs will be investigated and you have to agree to certain restrictions. For example, you can’t borrow more than £500 without telling the lender you are bankrupt.

• Bankruptcy - a guide

Debt relief orders

Debt relief orders (DROs) are an alternative to bankruptcy. They can help you deal with certain types of debt if you owe less than £15,000, don’t own your own home and your monthly spare income is £50 or less. You have to meet certain costs and conditions and apply for a DRO through an authorised debt specialist.

• Debt relief orders - ways out of bankruptcy

Fast-track voluntary arrangements

If you have been made bankrupt, a fast-track voluntary arrangement (FTVA) may be a way to annul (cancel) the bankruptcy and deal with your debts.
You have to apply for an FTVA through an officer of the bankruptcy court called the ‘Official Receiver’ and your creditors have to agree to it. There are costs involved and conditions you need to meet. For example, you must have assets (property, shares etc) that are easy to sell.

• Fast-track voluntary arrangements - ways out of bankruptcy

Consolidating your debts

Consolidating debt is when you take out a single new loan to pay off several existing debts. You should get independent advice before taking out a loan and make sure it's the right way to deal with your debt problem.

• Consolidating debts

More useful links

• Debt - where to get free help and advice

• Dealing with debt problems - a guide

• Debts and arrears

Useful contacts

• Money, tax and benefits contacts

In this section...

• Administration Orders - ways out of debt
• Consolidating debts
• Debt management plans - ways out of debt
• Individual voluntary arrangements (IVAs) - ways out of debt
• Informal arrangements - ways out of debt
• Debt relief orders - ways out of bankruptcy
• Fast-track voluntary arrangements - ways out of bankruptcy

Googling uk government debt scheme

http://www.yourdebtscleared.co.uk/

Comment:  Not very keen on them because they seem to be involved in CONSOLIDATION LOANS

There are many reasons people fall into debt difficulty - loss of income, having a baby, divorce or separating from a partner, sickness or bereavement - all of these things can make it very difficult to manage a budget.

You may fall behind with your rent, mortgage payments, credit card payments and other bills may mount up. Soon you can find yourself juggling payments and in debt. Many people struggling to pay their debts are often not sure who to speak to about debt advice or debt help.

With our 20 years of experience, Your Debts Cleared has helped thousands of people, just like you, solve their debt problems. We pride ourselves on giving the best debt advice or debt help. Our Debt free Helpline advice is always confidential & FREE, and we will determine the best solution for you.

This may be through an arrangement (under UK Government Debt Help legislation) with your creditors called an Individual Voluntary Arrangement (IVA). This arrangement will freeze any interest and charges being applied to your debts. Alternatively the debt help may be in the form of a Debt Management Plan. Both of these plans will allow you to make one affordable monthly payment to your creditors. Other solution could be consolidating your debts into one lower monthly payment through a consolidation loan or re-mortgage.

Whatever your circumstances are we aim to solve your debt problem in the fastest possible time.

Have a look at our information on debt solutions:

Debt Management Plans Individual Voluntary Arrangement (IVA) Government Debt Help Scheme Protected Trust Deeds (PTD) Scotland only Consolidation Loans

Don't let debt problems ruin your life. If you need debt advice call our debt free helpline and speak to one of our experienced debt advisors or take our online DEBT TEST.

Debt Sites

Individual_Voluntary_Arrangement

In the UK, an Individual Voluntary Arrangement (IVA) is a formal alternative for individuals wishing to avoid bankruptcy.
The IVA was established by and is governed by Part VIII of the Insolvency Act 1986 and constitutes a formal repayment proposal presented to a debtor's creditors via an Insolvency Practitioner. Usually (but not necessarily) the IVA comprises only the claims of unsecured creditors, leaving the rights of secured creditors largely unchanged.
An IVA is a contractual arrangement with creditors and can be as flexible as an individual's own circumstances; they can therefore be based on capital, income, third party payments or a combination of these.
In this process, a debtor who has enough money left over after priority creditors and essential expenses, may be able to arrange an individual voluntary arrangement.^[1] (After taking independent advice, debtors with less serious problems may wish to consider a debt management plan).
The analogous procedure for businesses is the Company Voluntary Arrangement.


Process

Creditors take a decision at a creditors' meeting called to consider the IVA proposal. The return to creditors is often higher than they would receive in bankruptcy. A vote is taken - by value. 75% in value of those creditors who vote at the meeting by person or by proxy must agree in order for the arrangement to be approved. If any of those voting are 'associates' (usually business associates, friends and family) then a second count is taken and 50% of non-associated creditors must approve it.^{[citation needed]}
IVA's were originally designed to provide relief to debts generated as a result of business insolvency. In recent years, increasing levels of consumer debt has led to many insolvent individuals with non-business generated debts seeking the legal protection offered within an IVA. IVAs may be popular with people who have large amounts of assets which they wish to protect. These assets, such as high equity properties and expensive cars etc, are not directly at risk under an IVA – as they may be in a bankruptcy.^[2]
In the UK, an increasing number of consumer debtors with overwhelming levels of debt are turning to specialist debt advice organisations that offer an alternative to bankruptcy via the use of an IVA.<sup>[citation needed]

Creditors Power During Insolvency</sup>

In the UK, once an IVA has been applied for and is in place through the courts, creditors are prevented from making direct contact under the terms of the IVA. All ongoing correspondence of an IVA must first go through the Insolvency Practitioner. The Insolvency Practitioner will contact you. The creditors will begin to deal with the Insolvency Practitioner and readily accept annual reports when submitted.