What are the problems?
If you're in debt and you are finding it hard to cope, it's important to deal with the problem straight away - the longer you ignore your debts, the worse the situation becomes.
What can I do?
Make a list of everything you owe
The first job is to sort out exactly what you owe, and to whom you owe it (your creditors). You then need to put these debts in order of importance. The most important ('priority') debts aren't necessarily the biggest ones. Priority debts are ones where serious action can be taken against you if you don't pay what you owe. Priority debts are things such as mortgage repayments, rent, taxes and payments ordered by the courts: if you don't sort these out, there's a possibility you could lose your home or go to prison.
Work out a personal budget
To find out what debt repayments you can afford, work out a weekly or monthly budget to see what you need to live on. It's important to be realistic and honest with yourself. Your budget will show how much money you can afford to commit to paying off your debts. Your budget may also show you where you can save money.
Talking to your creditors
Once you know what you can afford, you can talk to your creditors about your situation and what you're going to do about it. Offer to pay each debt off in a way you can afford - it's important not to offer to pay more than you can afford, and not to assume you'll be able to pay more in the future. It's important to follow up a phone call with a letter confirming what you said and agreed.
You may have little or nothing left to offer your non-priority creditors. You should still talk to them, explaining the situation; you may be able to tell them that you will pay them back at some point in the future - but don't make promises you can't keep.
Who Can Help?
Many organisations offer free, independent advice on debt problems, so you don't need to use companies that charge. The following organisations will give you free help and advice:
Citizens Advice Bureau (CAB)
Your local CAB is a good starting point for free advice. They provide free information and advice on legal, money and other problems: you can find your local CAB in the phone book or on their website. Contact Mid Devon CAB at Tiverton Town Hall 01884 234926 or Crediton Council Office 01363 778410
National Debtline offers free, confidential and independent help over the phone for people in England, Scotland and Wales. You can call their helpline and also download publications from their website. National Debtline provides a free self-help pack and leaflets, including help on how to work out a personal budget. You can download these from their website or ask for them to be posted to you by calling their helpline. Call 0800 881 8891 or go on-line at www.debtfreehelpline.co.uk and request a call-back
Consumer Credit Counselling Service (CCCS)
The CCCS also has a helpline, providing free, independent and impartial advice to people who have debt problems. www.cccs.co.uk
Mid Devon District Council
If you are struggling to pay your bills then council tax benefit and housing benefit could help. It isnít just those on income support or job seekerís allowance who can make a claim. If youíre retired, or even if you are working, you could still be entitled to council tax and housing benefits. Use our online benefits calculator at www.middevon.gov.uk (and follow the links to Benefits) or phone 01884 234259.
If youíre having trouble paying your council tax, please contact us immediately on 01884 234321 so weíre able to help straight away. We may be able to rearrange your payments.
Save with Devon Pound
If you need to borrow some cash or are looking for a safe place for your savings, or just need some financial advice, talk to Devon Pound - Devonís not-for-profit community bank. It offers good rates on short-term loans and could save you a packet compared to doorstep lenders. Call 0800 316 9296 or visit www.devonpound.co.uk
If you're being threatened with legal action, you can check the Community Legal Advice website to see what your legal rights are. You may also be entitled to free and independent advice from your local Law Centre.