Aside from bankruptcy, what other options does a person have when they can no longer pay their repayments without a struggle? Depending on the circumstances, you may want to consider debt consolidation if you have enough equity in your home. In debt consolidation your unsecured loans are consolidated into a single secured or unsecured loan. The interest rate and repayment schedule should leave you with a larger amount of money free to spend each month. Your home is at risk if you don't keep up with the loan repayments though. Also it's important to understand that this doesn't work for everyone, and you should not use it if you are consolidating high interest credit cards in order to be able to use them again.

 

Another possibility is debt management where you enlist the assistance of a debt management company who will assist you in working out a program for repayment, possibly lowering and perhaps even freezing interest, thus allowing you to repay your borrowings within a foreseeable period. The debt management company will sit down with you and work out a plan that will allow you to pay something on all of your debts. In addition, the debt management counselor will contacting your creditors to set up the agreement for payments, and they will make all of the payments for you.

 

If a debt management plan or a consolidation loan is not suitable for you, another alternative to bankruptcy is an Individual Voluntary Arrangement (IVA). A Licensed Insolvency Practitioner will review your financial circumstances and assist you in preposing a repayment plan to your creditors based on a realistic, affordable monthly payment, usually over a period of 60 months. At the end of the IVA, your creditors will write off the balance of the debt. An IVA will affect your credit rating and will appear on your credit file for a period of six years from the date of its acceptance. An IVA is less restrictive than bankruptcy and allows you to remian in control of your assets.

 

Whatever your debt situation, there's very often no "one fits all" solution. Everyone's circumstances are unique. Therefore it's important to call for expert debt advice. For free, confidential, professional debt advice ring 08000 434 336.