A Guide To Your Debt Management Solution

Devising a debt management solution can be scary for some people who are not good with money and may not understand financial jargon.
With that in mind, here is a run down of the steps involved in dealing with debt, so you can work through the problem and have a clear idea about what an independent adviser needs to know to help you put together an effective strategy.
List your debts
You need a detailed list of your creditors – the term for the people who you owe money.
Get together all the latest statements and letters you have - like credit cards, store cards and personal loans.
Take some paper and list each debt, noting the creditors name , the account number and latest total of the money you owe.
Prioritise your debts
This means putting them in order of importance, not the amount owed.
Secured debts take priority because the money owed is tied to your home and a lender can take steps to sell your home to pay off the debt. Priority debts are mortgage repayments, utility bills, like gas, water and electricity and taxes.
Unsecured debts take less priority. These are your credit or store cards, overdrafts, catalogues  and personal finance. 
 
Debt Management Solution

Plan a debt management solution

Start with income for a month and then deduct  living costs and t your priority debts.
Include money for travelling to work, clothing and small personal expenses.
A budget is a good financial exercise that shows exactly what you are spending and if any expenses can be cut.
If you have money left, this is disposable income. Split this fairly between your creditors.
Take debt advice
Take a second opinion from someone who understands a debt management solution.
Give them the information you have put together so far. They will check your figures, prioritise your debts and work out your disposable income for you.
Inform your creditors
Do this yourself or ask your debt adviser to act for you. Tell your creditors that you cannot meet your repayments, but are offering a regular reduced amount based on what you can afford.
Put the offer in writing, so you have a record of the agreement.
Your debt management solution is the starting place for repaying what you owe. You may have to go through this process several times as your financial circumstances change.

 

Client Testimonials
  • We were put in touch with Pathfinder by a friend of ours when a failed business created alot of personal debt of which we had no way of being able to continue with the payments . It seemed like a jungle with no way out . Dawn Speakman of Pathfinder...
  • After drowning in debt and not knowing which way to turn I was put in touch with Pathfinder DM, through their help and guidance I am now slowly getting this under control and myself back on track, the staff at Pathfinder have been professional...
  • In early 2009, I read an article in the Salford Advertiser, for Pathfinder, a debt management company. At the time I had run up debts of 50K on various credit cards, mainly through changing jobs, along with a reduction in salary.I arranged a meeting...