Getting expert advice about how to resolve a personal debt problem is vital. The internet is a great place to start and act on a personal recomendation if you have one.
If you are looking for a solution for a personal debt problem, you need to speak to someone who can help you understand the options available. These will range from debt management plans and individual voluntary arrangements to bankruptcy and debt relief orders.
There are certain people within the debt management industry called insolvency practitioners who are regulated. However, in general people giving debt advice do not have to be professionally qualified. Despite this there are a number of things you can do to make sure that you get the right advice.
Search the Internet for debt advice
There are a large number of web sites available dedicated to giving debt advice. You should invest some time reading up about the different options available to you. Use on line forums and debt calculators to help.
Because everyone’s circumstances are different, you should not make a final choice about which solution is right for you simply based on information you get from the internet.
However, the knowledge you get will help you ask the right questions when you do speak to someone and give you an idea whether the advice you are given seems correct.
Speak to 2-3 different debt companies
Once you feel that you are familiar with the options available, you must then speak to someone who can help you make a decision.
There are a huge number of different debt management companies who may give advice of varying quality. As such, it is vital to speak to two or three different organisations.
If you can get a personal recommendation, this is always a good starter for 10. Do not allow any one company to pressure you into making a decision before you have had a chance to compare their advice with that given by someone else.
Make sure you feel like the person you speak to has understood your circumstances and gone though all of the options.
Should I speak to a debt charity?
There are two major charitable organisations who offer help with debt problems. These are the CAB (Citizens Advice Bureaux) and the CCCS (Consumer Credit Counselling Service).
BMD Tip: Since this article was written the CCCS has changed its name to Step Change Charity
The qualifications of the staff in these organisations are not necessarily any better than any other commercial debt management company. As such, you should always still compare the advice given with one or two other organisations.
In addition charitable organisations have to be funded by someone. In the case of the largest free debt advice providers, they are funded by the creditors themselves. As such there is a need to question whether they ultimately work in your interests or the interests of your creditors who pay them.
If you feel that the charitable organisation you speak to is favouring a Debt Management Plan when you feel that you would be better undertaking an Individual Voluntary Arrangement then get a second and third opinion.
Making the decision about the right debt solution
When choosing which debt management company to work with, it is vital that you get as much information as you can about all of your options. The internet is a great place to start.
Always act on a recommendation if you have one. Otherwise plan to speak to 2-3 different companies and do not be pressured into working with one company before you have had a chance to speak to others.
Once you have compared the advice you have received, you will have a good idea of the way you want to proceed.
Remember, an IVA will normally last for 5 years and a debt management plan possibly for longer. As such, the company you choose should be the one you are most comfortable with.
