As household finances are squeezed even further, with recent rises in fuel and council tax, more people have been forced into spending on their plastic and are now looking to eliminate credit card debts. There are many ways to eliminate credit card debts without taking out a loan or going further into the red, here we explain a little more about these and how they could help relieve your financial situation.
Solutions available to eliminate credit card debt
Debt Management Plans
Debt management plans have become increasingly popular, as people struggling to secure a loan (or other credit facility) seek alternative ways to get out of debt. Debt management involves gathering all unsecured balances into one single monthly payment, which is worked out to be affordable for you. As part of our service, we negotiate with your creditors (on your behalf) to re-schedule your debts over a longer period of time – thus making the repayment more manageable. You’ll then just make one payment to us each month and we then distribute this to all of the people you owe money to. Debt management is a flexible and informal solution – so if you experience a drop in wages, your payments can be lowered accordingly so you’ll still be able to cope. With debt management, you’ll regain control of your finances whilst still repaying debts at a rate that’s affordable to you.
Individual Voluntary Arrangement (IVA)
An IVA is an effective way to eliminate credit card debts for people with balances over £15000. An Individual Voluntary Arrangement (IVA) is similar to a debt management plan, as all of your unsecured balances are gathered into one manageable payment. This payment is then distributed to your creditors on your behalf by a qualified insolvency practitioner. Unlike a debt management plan, an IVA is repaid over a fixed period of time – usually five years. Once the IVA term has finished all remaining unsecured balances are effectively written off. Plus once an IVA has been agreed all additional interest and charges stops being added. The insolvency practitioner will draft a legally-binding contract, which protects you from creditors changing their payment demands. For further information on IVAs or for free IVA advice, please click on this link.
Trust Deeds
A Trust Deed is similar to an Individual Voluntary Arrangement but is for people living in Scotland. Like an IVA, the Trust Deed is repaid over a fixed period of time, but with a Trust Deed this is usually three years. This means that typically within 36 months, you will be debt free from all of your unsecured balances – as any remaining unsecured balances will be written off in the same way as an IVA.
For information on all of our debt solutions, please click on this link.
Contact us for ways to eliminate credit card debts
If you’re struggling keeping up with repayments on your credit cards, we may be able to help. We have a range of debt solutions that could eliminate credit card debts and other unsecured balances – such as overdrafts, store cards, personal loans and catalogues. Just call the number at the top of this page for immediate help from an adviser, who will be able to offer free debt advice. Or click on one of the logos below.
