Debt advice works. Two-thirds of people (65%) either started repaying debts or had already paid them off in full within six months of getting debt advice.
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So, it's no surprise one of the most common things you'll hear people say after they've got debt advice is 'I wish I'd done it sooner'.
Still, you might be wary of getting help, especially if you don't know what to expect. For a start you can be assured you won't be judged. Plus, the process should be similar no matter where you go for help, largely thanks to a new Standard Financial Statement (SFS) that has been developed by the Money Advice Service.
From the advice provider to each of the companies you owe money, your income and outgoings will soon be considered in the same way through the SFS. So you can also be confident that you're getting consistent advice and are set on the best course of action to improve your situation.
What happens when you get debt advice?
There are three main ways to access free, confidential and impartial advice: face-to-face, over the phone or online.
What to find before you get debt advice
- Details of your income - wage slips, pension statement, benefit and tax credits letters
- Details of your household spending – what you spend on things like housing costs, food, transport, phone and bills
- Financial paperwork including latest bank statement and copies of loan or credit agreements
- Details of all your debts, including how much you owe and latest letters or demands for payment
- Copy of any court or enforcement action papers
Here's a run-down of what each type of service offers so you can decide which one is the best for you.
Face-to-face debt advice
You may have a short first interview with an adviser who asks for details about you and your income, outgoings and debts so they can work out what your next steps should be. After that, if you need more help, you may need to arrange further appointments.
Is it for you?
- Face-to-face advice can help if you're feeling vulnerable or could benefit from support to deal with creditors
- you just prefer to talk to someone face-to-face
- you need help with setting a budget and working out how much you have left to pay your creditors
- you've got a debt emergency where there may be a risk of losing your home, going to court or bailiffs (sheriff officer in Scotland) are coming.
Face-to-face advisers usually have local links to the council and can often sort out problems with rent or Council Tax arrears by speaking to the right person directly.
You might want to think about another way of getting advice if you find it difficult to get to weekday appointments. Most free debt advice organisations only offer appointments during office hours and some may not be open every day of the week. You may have to take time off work or arrange childcare.
It's often quicker to get telephone or online advice.
Most debt advice organisations have telephone advice services. Helplines are available Monday to Saturday and some are open in the evenings.
Your first call is usually a short interview so the adviser can get details of your debts, income and outgoings. You'll have to give personal details so the adviser can assess your situation. This information is confidential and is never shared without your consent.
After that if you need more advice you can arrange further appointments at a time to suit you.
Is it for you?
- Easy access to debt advice, particularly at an early stage when you might be worried about falling into debt or you've missed a payment.
- Longer opening times than face-to-face advice.
- May not be good for emergency debt problems, like court action for debt arrears, particularly if you're feeling vulnerable or need support. Although if you can't get to see anyone face-to-face, telephone advisers will be able tell you what your next steps should be and can offer some support.
The advantage of online advice is that it is anonymous, and you can get it whenever you want.
The main ways to get online advice are through:
- specialist online debt advice tools.
Webchat is often good for asking specific questions where you can get a quick reply. An adviser will also be able to tell you about next steps you can take to get help.
Debt advice tools offer the same service as an adviser. You'll fill in online questions about your income, outgoings and your debts. You should set aside around 20 minutes to answer the questions and try to have paperwork to hand so you can give accurate information.
At the end of the session you'll be given the best ways to deal with your debts and an action plan to support you in taking the next steps. This includes things like template letters for writing to your creditors and deadlines for when you need to do things by. If you're not sure what you need to do you can use webchat or call the helpline for one-to-one support.
Is it for you?
- Yes, if you're not sure about the best way to tackle your debts and you want to find out quickly and anonymously.
- You're feeling confident about dealing with your debts yourself but could benefit from understanding the process and in what order to do things.
- Online or webchat may not be for you if you get a bit flustered about using computers. You may prefer to speak to someone on the phone or face-to-face.
- If you've got an emergency debt problem, like court action for rent or Council Tax arrears, the tool will recognise that and tell you to act immediately but you might save time if you get an urgent drop-in face-to-face appointment with a local adviser.
Whichever advice route you take
- Provide as much detail as you can about situation (see the checklist below). This will help the adviser set up a budget for you and work out an affordable and sustainable repayment plan.
- Be open minded. You might have a debt solution in mind but a debt adviser is trained to look at your personal circumstances and suggest the best option for you. It might not be the one you were thinking about.
- Don't give up. Maybe you've tried getting one kind of debt advice and it didn't work out. Think about trying a different method or a different provider and see if that suits you better.
What does the Money Advice Service have to do with free debt advice?
The Money Advice Service is one of the largest funders of free debt advice in the UK. As well as providing funds to make the above services available to all, we also ensure that these services are of the best quality.
This article is provided by the Money Advice Service.