One Advice | Bankruptcy, IVA & Debt News

An increasing number of Brits are seeking debt advice, in order to help get their finances in check and ride out any adverse effects of the credit crunch.

Recent statistics reveal a 50% rise for those who are more likely to seek debt advice now than they were before the economic turn-down. If you feel as though you need to seek this credit crunch advice, you will be glad to know that help is at hand.

One Advice are a UK financial solutions company and we can offer you free debt advice, no matter how many creditors or how large or small your debt level is. We can offer a number of debt solutions which you may find you benefit from, including:

• Debt Management: Allowing you to make one single monthly payment to your unsecured debt. With a debt management plan, we will negotiate with your creditors so you only make the payment that you can afford to.
• IVA: A formalised version of a debt management plan which is more suitable for those with larger levels of debt, typically over £12,000. As part of the IVA plan, any unpaid debt will be written off on completion of the IVA. Call our IVA advisors on 0800 048 1752 to see if you are eligable.
• Bankruptcy: Should always be seen as a last resort when dealing with your debt problems. If you feel as though Bankruptcy is the only way out of debt then we can offer a personal Bankruptcy Service which will see you through each stage of the bankruptcy.

Getting a mortgage if you are a first-time buyer (FTB) is harder than ever, as the credit crunch means that mortgage lenders are asking for much higher deposits. If you are an FTB then it is important that you save as much of a deposit as possible, to increase the chance that you get accepted for a loan at a good rate of interest.

Michael O’Flynn from website FindaProperty has claimed that FTBs must make sacrifices if they wish to own a home in the current economic climate, saying that they should aim for a deposit of at least £16,500.

Flynn suggests that “treats such as eating out and holidays abroad may be worth missing out on for a year or two, as long as they keep their mind on the end goal of owning a home.”

As the credit crunch continues to take hold of our finances, an increasing number of Brits are taking more time to plan their personal finances, in order to keep their debt management under control.

Recent findings from Co-operative Life Planning has found that almost three quarters of us (74.1%) are planning our finances more, as an exact result of the credit crunch. Over half stated that they spend between 15-30 minutes a day dealing with money issues, such as budgeting or preparing for events which will cost money.

Managing direct of the unit, Ian Mackie, said: “Planning ahead for all life events is evidently becoming increasingly popular”.

Many of us are worried that rising debts and mortgage payment worries means that Christmas may have to be cancelled this year! One in three Brits are planning to have a credit crunch christmas by ‘recycling’ the unwanted Christmas presents that they received last year.

Over half of UK families have admitted to finacially struggling and are looking for ways to cut back on their Christmas spending. The average amount of spending on Christmas presents may reduce by 22% to £301.

8% admit that they will be getting into futher debt this year and have no idea about when they will be paying the money back. As our previous article mentioned, many of us are still paying off our Christmas 2007 debt.

Jim Hodgkins, managing director of CreditExpert.co.uk gave some wise advice: “Whatever you do spend this Christmas, you can improve your finances by remembering the crucial thing is to borrow responsibly.”

Although Brits may be more careful about how they spend their income, it seems that money lessons for debtors are needed as many are unaware of how to properly deal with their finances in the time of the credit crunch.

Norwich Union report that many Brits do not fully understand the different products which are available, which may lead to many facing debt problems, or even bankruptcy, due to poor financial decisions. Although we spend 180 million hours researching how to best spend our money, we have little idea about how to handle our finances.

Steve Genders, head of web at Norwich Union, says: “It’s clear from the research that the more time we spend researching, the less we know about what we’re buying. People need quality – and not necessarily quantity – searches.” Further findings show that almost 70% of us do not know what type of mortgage we own, and a similar percentage are unaware of how much their monthly home loan payment is.

Although debt worries are hitting every age group, those who are 50 and over are in the highest debt risk bracket, coupled with the fact that they are closer to retirement, it is essential that they seek debt advice.

The average 50-60 year old takes longer to pay off their debts and owes more, according to research. The average unsecured debt in this age range is £41,000, compared to the average debt level of £32,700 in other age groups. This is a 25% different in the amount of unsecured debt which is owed.

Unsecured debt consists of personal unsecured loans, credit cards, store cards and overdrafts which are usually lent at a much higher interest rate than secured debt.

Managing director for the debt management company which compiled the report said: “Although many people in their fifties are used to maintaining high levels of personal debt they are often just ‘treading water’ with repayments and covering little more than interest charges.”

In the times of credit crunch, many fear that their credit card or loan application will be rejected. This could be why Grandparents are offering cash to both their children and grandchildren in order to help make ends meet.

According to research by Engage Mutual, 57% of Grandparents have given out money to their loved ones. 35% of these loans were to help out with debt repayments. In the past six months, the average amount that grandparents are spending on their family stands at £1,800.

People in the North East of England are most likely to rely on hand-outs from their grandparents as three quarters (74%) are receiving some form financial support, such as to debt help with debt management issues.

Karl Elliott, spokesperson for Engage Mutual, said: “With rising living costs and debt repayments taking effect, the findings show that the majority of grandparents in Great Britain have had to help their families… With costs of living increasing and tougher times ahead it is important that people think ahead and save little and often in order to reduce the pressure to make ends meet.”

If you have high levels of unsecured debt then you may be thinking about credit card debt reduction services. There is no easy way for this to be done and the solution which is right for your credit card debt reduction is dependant on your credit card debt level and your personal circumstances.

Credit Card Debt Reduction involves paying off the balance outstanding on your credit card debt. But this debt reduction service could also include other unsecured debt, such as unsecured loans, overdrafts or store card debt.

There are a number of ways to reduce the amount you pay to your credit card debt, and One Advice are here to help. As one of the most experienced debt solution companies in the country, we can help you to find a debt solution which is right for your circumstances and can help with your credit card debt. (more…)

If you think that you are struggling with your level of unsecured debt then you might be thinking about some form of debt reduction. Consolidation of your debt could help you to reduce your monthly payments to your creditors and, with a secured debt consolidation loan, you could find that you reduce your overall interest rate.

Debt Consolidation Loans have helped people put their finances back on track, especially if you are looking for monthly payments to be reduced in order to achieve debt reduction. Consolidation means that you are combining your unsecured debt, such as unsecured loans, overdrafts, credit cards and store card debt, into one single loan.

But you may need to think carefully about this type of debt reduction service. Consolidation usually comes in the form of a debt consolidation loan. This often means that the debt will be secured against your home and failure to make the payments to your debt could lead to the risk of repossession. (more…)

If you are considering bankruptcy then it makes sense that you would seek out as much bankruptcy advice as possible before you take the plunge. There are a number of long-term bankruptcy effects which cannot be avoided, so it is important that you are fully informed about the process of bankruptcy and what it means to your personal, professional and financial standing.

This is why One Advice have put together a Bankruptcy Advice Guide. This will be continually updated and contains a resource of bankruptcy advice.

Latest additions to the Bankruptcy Advice Guide include:

• Bankruptcy/IVA – There are a number of debt solutions on the market, and it can often be tricky to work out which one is best for you, as each one has their own set of benefits and considerations. This article aims to help you to understand the distinct differences between Bankruptcy and IVA, and what this means to you…
• Restrictions During Bankruptcy – One of the most important things to consider before you declare bankruptcy, are what type of bankruptcy restrictions will be in place… (more…)

A national debt helpline is being put in place to help Scots who are having problems with their debt management issues. Cash machines will begin to show adverts which promote the telephone line.

This aim of this new debt helpline is to offer confidential and free debt advice for those who are suffering with financial problems due to the credit crunch, rise in unemployment and an increased cost of living.

The Scotland debt advice campaign has been backed with £382,000 of Scottish Government funding. Nicola Sturgeon, Deputy First Minister, believes this debt helpline is important as those who can no longer afford their debt need to face up to their financial problems. “Families across Scotland are feeling the pressure financially, with increases in food prices, rising bills and mortgage and lending uncertainty all adding to the headache.”

Debt Advice: Scotland

If you are a Scottish resident and need advice about your debt, One Advice are here to help.

There are a number of debt solutions which could be available. For low levels of unsecured debt you could be suitable for a debt management plan which allows you to make reduced monthly payments to your unsecured creditors.You may find that you are eligible for a Trust Deed where you could make reduced payments to your debt on a monthly basis. Your unaffordable debt could be written off in as little as 36 months.

For free debt advice and further information about your debt worries, contact the One Advice team of debt advisors on 0800 048 1752.

The credit crunch means that more people are putting their Christmas plans on hold and reducing the amount that they spend over the festive season. But many should be thinking about their spending habits over last Christmas, as one in four people are still repaying this debt.

According to website Savebuckets.com, 40% of Brits used credit cards or unsecured borrowing in order to afford Christmas 2007, but only 29% of these have managed to repay this debt during January. Those who are most at risk of falling into debt are people in their 30s, as 47% of this age group borrowed money last year.

James Wenger, of Savebuckets.com, commented: “With a rising number of Britons still paying for last Christmas it raises alarm bells over how the pattern will continue into 2009 as the economic turmoil continues.”

If you are worried about your Christmas and having problems with your debt management issues, One Advice have put together a guide on how to keep within a realistic Christmas Budget.

Almost 1.2 million UK homeowners could be facing negative equity if house prices continue to fall at the rate they are currently doing.

UK mortgage borrowers are facing the risk of negative equity and higher mortgage payments. The Bank of England’s Financial Stability Report (FSR) reports one in 10 homeowners could be left with their mortgage debt being more than the value of the home, due to the decrease in house prices.

About 3% of homeowners are currently in negative equity. But if house prices drop by another 15% from their record high in October 2007, this figure could sharply increase. Those who are most at risk of negative equity are first-time buyers who have recently purchased their first home.