{"id":3437,"date":"2014-01-22T10:05:49","date_gmt":"2014-01-22T10:05:49","guid":{"rendered":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/?p=3437"},"modified":"2021-06-29T10:17:25","modified_gmt":"2021-06-29T09:17:25","slug":"pay-off-my-debt-2","status":"publish","type":"post","link":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/pay-off-my-debt-2\/","title":{"rendered":"Pay off my debt"},"content":{"rendered":"\n

Nobody likes to be in debt and if you are to pay off your debts to \nyour creditors the money has to come from your surplus income or from \nthe sale of some or all of your assets or with funds provided by a \nfriend or relation who is willing to help you (whether or not they \nexpect you to repay them in the future) or you must find some way of \ngetting your creditors to accept less than full repayment or from some \ncombination of these \u2013 that is, assuming you do not win the lottery!<\/p>\n\n\n\n\n\n\n\n

So how do you go about paying off your debts?<\/h3>\n\n\n\n

Assuming you are unable to repay your debts from your surplus income \n(or from the sale of your assets) as and when they fall due and assuming\n that  no friends or relations are able or willing to help you out, then\n the first option you are likely to consider is a Debt Management Plan<\/strong>.\n Basically a Debt Management Plan is an agreement between you and your \ncreditors to repay all of your debts. You make regular payments out of \nwhatever surplus income you do have to a licensed debt management \ncompany and that company shares out your money between your creditors on\n a fair basis, retaining a portion of your money to cover their costs. \nThere are many debt management companies out there who can assist you \nbut of course you could agree a repayment plan with your creditors \nyourself and so avoid the cost of paying a debt management company. Such\n an arrangement is sometimes called a self-administered debt management plan<\/strong>.<\/p>\n\n\n\n

\"In<\/figure>\n\n\n\n

If you should decide on a Debt Management Plan, you should choose a company licensed by the Office of Fair Trading<\/strong>\n and once they have worked out a payment plan they will contact your \ncreditors and ask them to agree to the plan. You will have to give the \ncompany details of your financial situation: your income, debts assets \n(if you have any) and the creditors to whom you owe the money. Be aware \nof what the company will charge you for its services. They are likely to\n charge you a set up fee and a handling fee each time you make a \npayment. They will only deal with your unsecured debts<\/strong> and you will have to make sure you are retaining enough money to pay your secured debts<\/strong>\n such as your mortgage in full each month. Be aware that your Debt \nManagement Plan can be cancelled if you don\u2019t keep up the monthly \npayments and that the Debt Management Plan can last a long time until \nall of your unsecured debts are fully paid off.<\/p>\n\n\n\n

If you have a county court or High Court judgment against you for a \ndebt of less than \u00a35,000, you can look to get an administration order \nfrom the court whereby you make monthly payments to the court which \ndivides this money between your creditors. The court fee for this \nservice will be no more than 10% of your debts. Remember your total \ndebts must be no more than \u00a35,000 owed to at least two creditors. Again \nyou need to keep up the monthly payments or otherwise the court can take\n money from your wages by an \u2018attachment of earnings order\u2019 or it can \ncancel the administration order altogether.<\/p>\n\n\n\n

The third option you might consider is an Individual Voluntary \nArrangement or IVA whereby you make payments to creditors via an \ninsolvency practitioner or IP for a period of about five years. At least\n 75% of your creditors, as measured by the size of your debts, must \naccept your IVA proposal before it can be approved. You must be \ninsolvent to avail of an IVA and of course your IP will charge a fee for\n their services. Since you only pay what you can afford and because the \nterm of the IVA is limited (usually five years, although it can \nsometimes be extended to perhaps seven years) a certain amount of your \ndebts can be written off at the end of the term and your creditors \ncannot pursue you for any unpaid amounts, provided you comply with and \nadhere to the terms of the IVA as agreed at the outset.<\/p>\n\n\n\n

If your debts are less than \u00a330,000 and you have little spare income (less than \u00a375 per month) and you have few assets (less than \u00a32,000 in value and for example, you don\u2019t own your home) you might be eligible to apply for a Debt Relief Order. It usually lasts just one year, you normally have no payments to make to creditors and you are discharged from your debts after one year. A Debt Relief Order can be an attractive option for those who are eligible to avail of it.<\/p>\n\n\n\n

If you have already been made bankrupt, you may be eligible for a \nFast-track Voluntary Arrangement or FTVA. In a FTVA your assets are sold\n to pay your debts and your bankruptcy is annulled or cancelled. You \nsend a FTVA application to the Official Receiver and if 75% of your \ncreditors accept it the FTVA commences.<\/p>\n\n\n\n

To explore any of the above please contact us at National Debt Relief<\/strong>.<\/p>\n\n\n\n

National Debt Relief belongs to a firm of leading chartered accountants who are one of the largest insolvency practices in the UK. We offer a complete portfolio of personal insolvency services in relation to IVA, Debt Management Plan and Bankruptcy. All our debt advice is confidential and with no obligation.<\/p>\n","protected":false},"excerpt":{"rendered":"

Nobody likes to be in debt and if you are to pay off your debts to your creditors the money has to come from your surplus income or from the sale of some or all of your assets or with funds provided by a friend or relation who is willing to help you (whether or […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_seopress_robots_primary_cat":"none","_seopress_titles_title":"","_seopress_titles_desc":"","_seopress_robots_index":"","footnotes":""},"categories":[6],"tags":[],"class_list":["post-3437","post","type-post","status-publish","format-standard","hentry","category-general-debt-articles"],"_links":{"self":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts\/3437","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/comments?post=3437"}],"version-history":[{"count":2,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts\/3437\/revisions"}],"predecessor-version":[{"id":13626,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/posts\/3437\/revisions\/13626"}],"wp:attachment":[{"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/media?parent=3437"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/categories?post=3437"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nationaldebtrelief.co.uk\/debt-articles\/wp-json\/wp\/v2\/tags?post=3437"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}