If you address your debt at an early stage, there are more options available to you. The options can vary according to the type and size of your debt, your circumstances, and other key factors. The action creditors can take also varies according to the type of debt.
For most debts, the creditor will need to go to court for a County Court Judgment before they take more serious action, although other creditors might be able to take different and more serious action at earlier stages. This can include debt rent or mortgage arrears, Council Tax, gas and electricity arrears, and child maintenance.
If you receive debt advice, you may find that your debt adviser can help you achieve some long-term solutions to help your situation. Receiving advice can also often help you cope with the stress and difficult feelings that debt can cause.
The solutions may be informal, such as negotiating lower repayments (also known as a "Debt Management Plan"), or formal, including Debt Relief Orders, Individual Voluntary Arrangements or Bankruptcy. There are advantages and disadvantages of each, and an adviser will run through your circumstances and help find the most appropriate solution to you and provide support.
When receiving debt advice, it is important that the advice is independent, impartial, confidential, and free. There are many organisations who will offer to negotiate your debts and charge you a fee for this. These paid services however rarely achieve a more successful outcome than the free advice which is available, and creditors might be reluctant to work with them.