Dealing with debt

Name: Christians Against Poverty UK
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Understand the best ways to deal with your debt.

There are many reasons someone might fall into debt, including low income, ill-health, bereavement, or a change in circumstance.

Whatever the reason you find yourself in debt, we are here to help. We want to empower you to take those first steps in dealing with your debt, whether that’s talking to a loved one about what’s going on, or getting to grips with what you owe.

Whether you just can’t seem to make ends meet within your budget, or you feel like you’re totally drowning in debt, you are not alone. No matter how complicated the situation, there is always hope.

Christians Against Poverty (CAP) offers a totally free, accredited debt help service. We’ll empower you to take back control of your finances and support you all the way through to becoming debt free.

Find out more about CAP Debt Help

One of the first steps in dealing with debt is working out how much you owe to each creditor.

You can do this by checking your credit file and talking to your creditors directly. These are both explained below.

Check your credit report

It might be helpful to access a credit report, which will show you a summary of your financial information from the last six years. A credit report is different to your credit score. A credit report should give you a better understanding of what debts you owe, although not all debts will necessarily be listed.

If you choose to do this, make sure you use a free service, not a subscription service. We recommend TransUnion or Experian, whose websites explain how to check your credit report with them.

Add a notice of correction to your file

In certain circumstances, you may wish to add a notice of correction onto your credit file. This is a note that allows you to explain something, like why you got into debt, or why something may be misleading in your file.

Adding a notice of correction may help lenders decide whether to lend to you in the future. We recommend you seek further advice to establish if this is the right course of action for you.

Talk to your creditors (those you owe money to)

Contact your creditors directly to see how much you owe them. Your creditors could include:

Your landlord
Energy companies
Council Tax
The Department for Work and Pensions (DWP)
Credit cards

Many organisations already have established processes in place to support those who are struggling to pay. By letting them know your situation, you can have a chat about what you owe, and they should work with you to come up with a plan that’s more affordable for you.

If you find that despite these plans, you’re struggling to make ends meet or keep up with payments, we’d love to help. Our free, professional debt help includes creating a budget for you, while supporting you through an appropriate route out of debt.

You can also mention any factors that would suggest you are a ‘vulnerable customer’, such as mental or physical health issues. This may mean they’re able to be more flexible based on your specific needs.

Sometimes if you’ve not had contact with a creditor or not made a payment for a long time (6 years) your debt might not be enforceable. If you think this may be the case with any of your debts then you may wish to get advice before contacting your creditors.

If you’re receiving CAP Debt Help, then depending on your route out of debt, we’ll contact your creditors on your behalf and let them know you’re working with us.

Get free, professional debt help with CAP

Talking to family and friends about debt

Talking to someone about your debt is important. Many people prefer to talk to someone they know, while others find it easier to speak to a professional who can offer a non-judgemental listening ear.

Friends and family can offer emotional support, as well as practical support such as helping you contact creditors, or being with you while you make that first call to CAP for debt help.

If you’re worried about your mental health

Speak to a medical professional

Some people find it easier to speak to a medical professional about their debt and the worries that come with financial difficulty. We know that debt and mental health are linked, so we’d encourage you to speak to a medical professional if this is something you’re struggling with.

Urgent support

If you need to talk to someone urgently, we’d encourage you to get in touch with Samaritans. Samaritans provides free, confidential support for people experiencing feelings of distress or despair.

Phone: 116 123 (free 24-hour helpline)
Email: [email protected]
Website: samaritans.org

Other mental health support

Whatever you’re going through, there are charities and organisations across the UK that are ready and willing to give you the support you need. Many offer listening services, helplines and crisis support, depending on your needs.

Find mental health support

Common questions about dealing with debt

If I go through insolvency, will I be on a ‘blacklist’ forever?

All forms of insolvency will appear in your credit history, usually for six years. This means that going through bankruptcy (for example) will affect your credit rating, which can make it harder to get credit for things like a mortgage or a loan during that time.

You may also be asked to disclose if you’ve been through bankruptcy when applying for financial products in the future.

What happens to your debts when you die?

If you have an estate, your executors (that’s the people you name in your will to take care of your wishes and estate) are responsible for using your assets to pay off any debts in your name.

If you don’t have an estate, any debts in your name will be written off.

If you have any joint debts, the other joint debt holder is then responsible for the debt.

Can I go to prison because of my debt?

There are very few debts you can go to prison for. Although rare, it is possible for non-payment of the following debts: Council Tax (England only), business rates, and child maintenance arrears owed to the Child Maintenance Service (CMS).

Although this is not unheard of, it is extremely rare, and a last resort.

Will I have to go bankrupt?

Bankruptcy is just a route out of debt. If you work with CAP’s Debt Help service, we’ll chat through the options suitable for your individual circumstances with you.

In England and Wales, you no longer need to go to court to file for bankruptcy. Instead, the process is all done online.

It’s also very rare that anyone would find out you’ve gone through bankruptcy. For most people the only public information will be a small notice in the London Gazette (or Belfast Telegraph if your bankruptcy is processed in Northern Ireland), the Insolvency Register (England, Wales and Northern Ireland), or the Register of Insolvencies (Scotland).

Are bailiffs (now called enforcement agents) going to take my things?

In England and Wales, enforcement agents are employed by your creditors to collect a debt. There are certain things you can do, such as contacting the enforcement agent or creditor directly to discuss payment of the debt and by not letting the enforcement agent into your home (though this is dependent on the debt type).

If an enforcement agent enters your home, they will write a list of what items can be removed for sale- this is called taking control of goods. To avoid the enforcement agent removing the goods you would need to repay the debt in full or set up a payment plan with the enforcement agent as part of a Controlled Goods Agreement (CGA). If this agreement is then broken then the Enforcement Agent can return to remove the goods. Controlled Goods Agreements are only applicable in England and Wales (see more information on dealing with enforcement agents).

In Scotland, enforcement agents are called Sheriff Officers. Sheriff Officers can only enter your home if they have the correct authority and permission to do so with a warrant. Unfortunately, if they have permission they can use necessary reasonable force to enter your home which may mean forcing open a door or breaking a window if you don’t let them in. If there is an Exceptional Attachment Order in place, the sheriff can enter your home to seize possessions that can be used to pay off your debts. There’s more Scotland specific advice here.

In Northern Ireland, court judgments are dealt with and enforced by the Enforcement of Judgments Office (EJO), a centralised unit whose powers and procedures are set out in legislation. There’s more Northern Ireland specific information here.

However, the most important thing is to address your debt as soon as you can. If you ignore things, they will continue to get worse.

Can I dispute a debt?

There are some cases in which you can challenge whether you have to pay a debt.

If you’re unsure and would like to check, get in touch with your local Citizens Advice from whichever part of the UK you’re in.

Will I be evicted?

This really depends on your individual circumstances. Paying your rent or mortgage is a priority, so if you’re struggling, it’s important to talk to your landlord or mortgage provider about this as soon as possible.

If you’ve received a notice from your landlord or mortgage provider that they wish to evict you, you can contact Shelter urgently. Shelter has a lot of information and advice for all UK nations on their website, or you can get in touch with them to find out more.