Checking your debt solution
Over the years I have noticed a number of reasons that people are not happy with the solution they have in place. Click on the relevant link or read some of the reasons below.
Some of the reasons people may not be happy are:
- Falling behind on payments or struggling with other bills because a debt adviser was not realistic when creating a budget
- DMPs are informal solutions, so creditors can still take legal action to collect the debt at any time
- Fearing the IVA failing some years down the road and resulting in bankruptcy anyway, which is a cost that you may have to front yourself
- Deciding that under their current solution it will take far too long to repay the debt (if you are in a debt management plan for longer than 5 years it may be worth considering another solution).
- Realising that creditors do not have to freeze interest and may be able to start charging it again. It is also possible to end up owing more than when the debt management plan first started.
- Being told that an IVA is in place when it is actually a debt management plan, meaning it may take a lot longer to repay the debt.
- Realising that more will be paid through a debt management plan than is owed because the debt management company is taking 15% or more of the monthly payment
If you are unsure about your solution then you should get a second opinion.
Reasons for changing your debt solution
It is an unfortunate reality that you may need to change your debt solution. Some common reasons for this are:
- Your circumstances have changed since you were first advised
- You received poor advice from a charity or a debt management company
- You have realised that the solution you have in place is not suitable for you
Whatever the reason it is what you do next that is important as it will have a significant impact on your future and the happiness of you and your family.
How to change your solution
If you are wondering whether the solution that you are in now is the correct one then get a second opinion. Getting a second opinion is beneficial to:
- Reduce the chance of you relying on bad advice from one organisation
- Help you establish whether the solution you are in now is suitable for you
- Help you identify a more suitable solution
For more information go to the getting a second opinion page.
The suitability of your solution
Choosing the right solution first time round can save years of heart ache for you and your family. For example, if you enter an IVA which is unsuitable and then have to go bankrupt after 3 years you will have wasted three years. The key to getting it right first time is good advice, though NOT just from one organisation. Many people make the mistake of trusting one organisation – always get a second opinion regardless of who they are and how much you trust them.
For more information read about choosing a debt solution and debt advice organisations.
