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The different debt solutions

Dealing with a debt problem is something you will probably do just once in a lifetime. The solutions are new to almost everyone when they first seek advice. You also have to contend with a lot of industry jargon.

This page will help you to understand all of the possible debt solutions open to you, so that your decision making process is both easier and better informed.

There are just three key things we need to consider when deciding on the best debt solution for your own particular circumstances:

1. How much do you owe on credit cards and unsecured loans?
2. How much do you earn each month?
3. How much do you need to live on?

The first two of these are simple statements of fact. The third depends on what you tell us about your situation. ClearStart will always give you honest advice on whether or not your lenders will consider your requested living costs to be reasonable. Lenders use something called the "common financial statement" to work out reasonable living costs based upon average family sizes.

Once we have the answers to each of the three questions above, we can quickly tell you what options are available to you. To get started right away, just call us on 0800 988 9345 or complete our online application form. We might suggest an IVA, a debt management plan or simply some fresh ideas on how to improve your situation. In each case we'll explain all of your choices and how long each solution will take, as well as what happens to any monthly contributions you need to make.

 

You can also find out more about different debt solutions by going to our product suitability page or by following one of the links below:

IVA

For people facing serious debts, the Individual Voluntary Arrangement (IVA) is often an effective solution because it eliminates debt, rather than helping you to live with it. IVAs are provided on identical terms by all debt solutions providers.

Debt management plan

A well run debt management plan can work for many people, as long as the payments are set at a sensible level. ClearStart can provide you with the best value debt management plan in the UK.

Bankruptcy

This is a last resort, with far more serious consequences for your future than an IVA or debt management plan. Wherever possible, ClearStart will try to ensure a successful debt solution instead of bankruptcy.

DRO

A new government initiative, Debt Relief Orders (DROs) are designed as a simplified form of bankruptcy for people with smaller debts. To qualify you must owe less than £15,000 and have less than £50 of disposable income per month.

Remortgaging

This is similar to a consolidation loan but it is secured against your house. If you can obtain access to a secured loan and comfortably afford the repayments then this is a good solution, but remember that your home will be at risk if you cannot keep up with repayments.

 

Three steps to a better future

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