Many of us, particularly these days have at least some form of debt. Be it a mortgage, personal loan, maxed out credit card or even car finance. What’s not surprising is that often people struggle to make payments on the above debts. Month to month our income does not stretch too far and covering a high amount of outgoings becomes extremely tough. Especially if you have multiple debts, with multiple lenders. If you’re struggling to make payments on your debts however, there are options that you might consider in order to lower the monthly payments you’re making and limit the amount of interest you’re paying to the lender.
The first option and possibly most obvious is to consolidate all of your debts into a single, easily manageable (and affordable) monthly payment. If this is feasible, it could be the answer to all of your debt and financial management woes. By consolidating, you can clear all of your existing debt and arrange a monthly payment to a single lender than you can easily afford to meet each month. No more late fees, charges or penalties. The only downside to this is that it is indeed another loan that you need to take out and you might end up paying a fair amount in interest. All be it, over a longer period of time than your current debts.
The second option would be to consider an Individual Voluntary Arrangement (IVA). This should only really be used if your debt has become so substantial that it is unmanageable and you’re unable to meet the payments required. One of the major downsides to the IVA option is that you must have at least £15,000 of debt to qualify in total. You must also meet the payments on the IVA as you would do with a standard personal or secured loan. You will still risk bankruptcy if you do not meet the payments and it should by no means be considering an easy solution to your debt and general financial worries.
admin
30 Jul, 2009