Being drowned in debt does not only affect one’s financial standing. It can also have a huge impact on a person’s mental and physical health.
Unfortunately, some people just find it hard to resist the urge to indulge in excessive spending and credit card use. In fact, the National Audit Office reveals that more than 8 million individuals living in U.K. are not able to pay off their debts. If you’re among those people who are having serious trouble with debt, now is the time to take action. Consider having your debt written off. But, how? Read further to find out.
1. Be honest to yourself and accept the situation that you’re in.
It can be hard to resolve an issue without first accepting the fact that there is a problem indeed that need certain solution. Start by learning to accept the predicament that you’re currently in. If possible, confide in your loved one. This way, it will become easier for you to look for ways on how you can ease the burden of debt.
2. Calculate how much debt you owe.
Sort your debts and classify them according to priority. Keep in mind that the largest debt you owe does not necessarily have to be your top priority. Prioritize the one that increases your risk of being led to prosecution. The same thing with a debt that affects your ability to live comfortably. One example of this is your mortgage debt.Then, check how much you owe for your gas and electricity bills. Also, check your Council Tax and see how much arrears you have because failure to pay it could make you end up in court. Your car loan should also be included in your high priority list especially if you find it hard to go to work without your own car. What comes next will be your low priority debts such as your credit card debt, unsecured loans, as well as overdrafts.
3. Consider the possibility of your debt to be written off.
If you have been unable to work due to an illness or an injury that makes you unable to find a decent job, creditors will be more likely to consider your situation and get debt written off. This comes as a better alternative rather than just letting your creditors relentlessly calling you, asking you for money that you’d never going to have unless a miracle changes your current situation. Some creditors do agree for a debt to be written off provided that the debtor has no assets and has enough evidence to show his inability to pay.
4. Contact your creditor.
The next thing that you’re going to do is to contact your creditor. Be prepared to explain truthfully your predicament. If you’re unable to pay due to a loss of job or being diagnosed with an illness, bring the necessary documents as proof. Contacting your creditors is one good way of showing that you have the willingness to pay. However, the circumstances that you’re in now prevents you from doing so. But when you proactively talk to your creditors, they will be less likely to take action against you.
5. Choose an alternative repayment plan.
If your inability to pay is due to an illness that prevents you from going to work, you may ask for a payment holiday. These repayment plans operate on a case to case basis. Some creditors will allow reduced payments until you are able to get back to work.
Keep in mind that lenders who are operating legally would need you to repay what you owe them. So, chances are they will also be willing to help you find a solution on how you can pay your debt.