Getting into debt can be worrying and isolating, but it’s never too late to start getting on top of those bills and breathe new life into your credit score.
If life has taught us anything, it’s that we’re all vulnerable to losing our jobs and finding ourselves up to our necks in debt. Most of us have regular bills that need paying, including rent or mortgages, phone and energy bills, and credit card accounts.
Perhaps you’ve taken out a repayment plan on a newer car or have holidays booked and weddings planned. Sometimes, we simply have eyes bigger than our bellies when it comes to spending.
Of course, on top of the usual stresses and strains of life, we have had to deal with COVID-19; the pandemic and following on from that, the resulting economic slowdown with inflation at a 20-year high which has been ruthless in its desecration of finances for many of us.
You are not alone
Internalising our problems, however, can lead to mental health concerns and affect our relationships too. So, a good first step on the road to financial recovery is to share a problem with others — you might even find that the person you turn to has had a similar experience and sound advice to offer. If nothing else, the act of telling your story may lighten the load a little.
Who can help?
But what if you don’t feel that you can share your concerns with friends or family?
Fortunately, there are plenty of organisations that can offer free impartial support, including the Citizens Advice service and the debt charity StepChange. If you would rather begin by chatting online, take a look at nationaldebtline.org, which is packed with information and provides web-based advisors.
The road to recovery
The good news in all of this is that there are a number of steps you can take to get back on track. A useful place to begin is by checking out your credit scores. This will help you better understand how lenders see you. In turn, you can see whether there are errors you can rectify or simple procedures — such as going on the electoral roll — that can stand you in good stead going forward. Why not take a look at our Help Centre for the key factors that affect your credit scores as a starting point?
Getting support
Take a breath. In May 2021 a government scheme, Breathing Space, was launched for people struggling with debt. The statutory Debt Respite scheme, covering England and Wales, offers those who need it a 60-day period of legal protection while they work with a debt adviser on a long-term solution. Your debts will still be due for payment during this time, but it prevents creditors from taking action against you if you’re unable to make the payments. A similar statutory moratorium scheme exists in Scotland.
Even if you’re in debt, you still have rights — you can speak to your lender and discuss a new repayment plan or a payment holiday. According to the National Debt Line, creditors have to treat you fairly and consider your offers of payment and consider freezing interest charges — if you ask them.
Of course, it’s important to remember that pursuing debt solutions, having mortgage holidays or speaking to your lender about a different repayment plan can affect your credit rating. However, you will still be in a better position than by doing nothing, and any positive steps will help you to rebuild your credit rating for the future.
Bottom line
To misquote that old phrase, even if life has thrown us a lot of lemons, that doesn’t mean that the future has to be sour. There is help and support available when it comes to debt.