Should I manage my debt problem myself?

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Problem debt can happen to anyone at any time. We know this because we offer free debt advice to thousands of people every year. How did they end up with problem debt? It's usually an income shock, such as redundancy or divorce.

Some people don't want to take the advice of a registered debt charity. They'd prefer to speak to their creditors directly and come to an arrangement. They usually put together a budget and approach their creditors with a reduced payment.


Can I make reduced payments to my creditors?
Creditors will generally look over any budget, and in the short term (usually three to six months) creditors may allow you to make reduced payments towards unsecured debts.
Of course you must maintain any priority bills during this time, such as secured lending, mortgages, utility bills and Council Tax payments.

Creditors will usually ask for the payment to be made in a manner that suits them. If you have come to a deal with a creditor it's important that you stick to it, particularly if you bank with the same institution.

What will creditors do during this time?
Even though you are making regular – if reduced - payments creditors can still follow the normal debt collection process. Some people find this upsetting and difficult to deal with, especially when you're facing creditors on your own and without the support of a debt charity like us.

It's also up to the creditor to decide if they'll stop any interest and charges during this time. In some cases extra charges may be added to your debts due to the reduced payments.

Your credit rating will be affected and you may even receive a default notice from a creditor.

Default notices will stay on your credit file for six years and could restrict access to credit available in the future.

Reasons to speak to us and not go it alone
We can't promise that we can get creditors to freeze interest and charges - no debt charity or company can, as it's entirely up to the creditor. What we can promise is free and impartial debt advice that lets you know all your available options.

Your creditors also know that if you've taken advice from an organisation like us you're more likely to be clued up on what your options are and what your creditors are likely to do.

Creditors know that any budget we draw up with you will be accurate and reasonable and that any debt solution we've recommended will be the best way forward for your own personal situation.

There are various debt solutions available to those suffering with problem debt. One of the problems of 'going it alone' is that you may not be aware of all the solutions that are available. Some of these solutions, such as a debt management plan (DMP), are offered by us free of charge.

As well as giving the best advice, we offer ongoing support and encouragement both online and by phone. There's no need to go it alone when we can offer so much support.

If you want to deal with your debts alone, and you're confident you can handle any creditor action, we'd still recommend that you try our online confidential debt advice tool Debt Remedy. It will help you to produce a budget and give personalised advice tailored for your own situation. You might also find a solution to your debt problem that you hadn't considered.

This blog is by Step Change Debt Charity