Credit card debt is reducing each month according to the Bank of England. It appears that less people are using plastic and instead dealing with their debt. However, it seems a lot of people are actually writing off their debt as opposed to repaying it.
Statistics show that £6million has been written off every day this year with people entering insolvency solutions to resolve their debt.
Credit card debt fell by £118 million in April, which is the largest drop since August 2006. Despite the positive signs that credit card debt is reducing there are worrying signs that people are turning to payday loans with their high interest rates.
The current level of UK personal debt is £1.5 trillion and it’s been forecast that by 2015 that total will be over 2.1 trillion.
Unsecured debt is a problem many people in the UK encounter and it’s important to seek professional debt advice to get a grasp on the solutions which are available. There are thousands of people entering insolvency solutions in the UK every year because they have no alternative route to resolve their debts.
What is an insolvency solution?
When people are unable to meet their contractual obligation as it falls due then it can be a frightening time and at Debt Support Trust we often hear people are using credit to pay for credit. It’s often described as “robbing Peter to pay Paul”.
For some people a debt management plan or debt arrangement scheme would take too long or would not be affordable, so the best solution is an insolvency solution like Bankruptcy.
Any insolvency solution, such as Bankruptcy, an IVA or a Protected Trust Deed Scotland should not be entered into lightly. These solutions affect your credit file and in some instances can even affect your employment. It’s always advisable to seek professional debt advice from a charity before entering into any debt solution.
Getting debt help
At Debt Support Trust we offer debt advice over the telephone for free. If you would prefer debt help face to face you can contact your local Citizens Advice Bureau office. For telephone based debt advice with our charity please telephone 0800 085 0226 where a friendly volunteer will be happy to help.