Debt Help Guide

If you're struggling with debt, the most important thing to know is this: there is always a way forward. Free, confidential debt help is available no matter how much you owe or how long you've been in difficulty.

Step 1: Get the Full Picture

Before you can tackle debt, list every debt you have: who you owe money to, how much, the interest rate, and whether you're in arrears. Once you have the full picture it feels more manageable.

Step 2: Priority Debts First

Priority debts have serious consequences if ignored. Deal with these before anything else, even if the balance is smaller.

Step 3: Non-Priority Debts

These include credit cards, personal loans, overdrafts, payday loans, and catalogue debt. Pay the minimum on all, then throw spare money at the highest-interest one first (avalanche method) or the smallest balance first (snowball method).

Debt Solutions Explained

Debt Management Plan (DMP)

One reduced monthly payment distributed to your creditors. Free via StepChange or PayPlan. Creditors often freeze interest. Takes longer to pay off but keeps you in control.

Individual Voluntary Arrangement (IVA)

A formal, legally binding agreement to pay back a portion of your debt over typically 5–6 years — the remainder is written off. Needs debts of roughly £10,000+ and an Insolvency Practitioner. Always use a reputable firm — beware of companies charging large fees for a free service.

Debt Relief Order (DRO)

For people with debts under £30,000, little or no assets, and low income. Pauses debt for 12 months then writes it off. Costs £90. Apply through an authorised debt adviser.

Bankruptcy

A last resort that writes off most debts. Costs £680 to apply. Serious consequences including losing assets. Best discussed with a free debt adviser first.

Breathing Space Scheme

The Debt Respite Scheme gives you 60 days free from creditor contact and enforcement action while you get debt advice. Mental health crisis patients get longer protection. Ask a debt adviser to apply on your behalf.

What NOT to Do

• Don't take out more debt to pay off debt — especially payday loans, which can spiral quickly
• Don't ignore letters — unopened letters escalate debts, they don't make them go away
• Don't pay a claims management company — genuine debt services are free

Free Debt Help