A default badly damages your credit score, so how long will it stay there? That depends on what the default date is on your credit record. In Britain, the credit record rules say: the debt, including the default, is deleted from your credit record six years later after the first default. A debt that is marked as defaulted will be deleted after six years in all the following … [Read more...]
Getting out of debt
Practical articles about the different debt options, which might work for you and different ways of dealing with creditors
Answers to the Quiz about types of debt
SPOILER ALERT Have a go at the quiz here before reading this page! A reminder: all the examples are for someone living in England, Wales or Northern Ireland. The same general diagram may apply in other countries, but the types of debts, the timescales and credit recording may be very different. A brief (no jargon!) explanation of my terms: Priority = a debt that is important, because … [Read more...]
Do you know your debts? A quiz!
Is that debt is a priority? Could you get a CCJ for it? Why isn't it on your credit record? If you have problems with your debts, it helps to understand why different debts sometimes have to be handled differently. Getting one wrong could be a big mistake! Here is a quiz, seeing if you can place some debt examples into the right place on the diagram below. Whether you think you are a debt … [Read more...]
Inheriting money when in a DMP, DRO, IVA or bankruptcy
What happens if you inherit money when you are in a debt management plan or one of the three forms of insolvency: Debt Relief Order (DRO), bankruptcy or IVA? The answers are surprisingly different... Inheriting in a DMP This is the easiest case. Any money you inherit comes to you, not to your creditors or your DMP firm. It doesn't matter if the person dies before your DMP started or during … [Read more...]
Can I get another car after VT or is part exchange better?
A reader asked: I want to terminate my PCP car finance. The car's fine, good condition, but we now need a bigger car. According to my contract I can hand it back. But I am going to need to get another car, so I am worried this will harm my good credit record. Would part exchange be better? Your right to end a PCP contract early Personal Contract Purchase (PCP) is the most common way to buy … [Read more...]
How to stop a debt being sent to the bailiffs
Are you worried about bailiffs? If you have problem debts, seeing programs like Can't pay? We'll take it away can be alarming. As one reader said: If I stop my direct debit and don't pay them this month surely they will not be happy? I don’t want bailiffs around my house. If you have already had a letter from a bailiff read: Bailiffs - do you have to let them in? What you need to know. This … [Read more...]
Have you told people about your debts?
Talking about your debts can be hard. You might feel it’s nobody’s business but your own and you just want to sort it out yourself, rather than reaching out to other people. Or you may not want to explain how your debts got so large in the first place - perhaps feeling embarrassed about it. But that’s not the case for everyone. Perhaps talking it through, perhaps with just one person, has … [Read more...]
I want to sell my house to end my IVA
A reader asked: We are desperate to end our IVA. So difficult. The IVA firm that seemed helpful at the start now after two years doesn't care about our extra costs. We have decided to sell and downsize. My wife is hoping for a discount but I said they were more likely to charge us more to get out early! We need as much equity as possible for the next house. This is a tricky situation. There … [Read more...]
What are your car finance options?
Cash is often the most cost-effective way to buy a car. But this isn’t always possible, especially if you have money problems. In 2018 more than 80% of new cars in Britain were bought on finance - but that doesn't mean it's going to be right for you! The four ways to finance your car a personal loan - a loan from your bank or building society to spread the cost over 1 to 7 years. Here … [Read more...]
Won your Financial Ombudsman case but worried you won’t be paid?
Financial Ombudsman decisions are legally binding on the firm. But if it's been a couple of weeks and you haven't been paid, you may be feeling worried... This article gives some information on how you can enforce a decision from the Financial Ombudsman Service (FOS) through the courts. I'm doing this to re-assure you that it can be done, not to encourage you to rush out and do it! It is … [Read more...]
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