Scots are facing an ‘unprecedented struggle’ against debt
A charity has revealed startling statistics that Scots are increasingly struggling with their debts and they have risen by 12% over the past year for those who are already struggling financially.
More worryingly, the charity says debt for these people will rise by another 17% over the coming year.
This will lead to a big increase in people being unable to pay their council rent and council tax.
There are now calls for a new strategy to address debt and help people living in Scotland.
The charity’s report also points out it is working to help those in need and says growing numbers of households are struggling with ill-health because they are unable to pay their rent, fuel bills and council tax.
Warning that those in debt in Scotland
There’s a warning in the report that those in debt in Scotland are accumulating even more debt which they will struggle to pay off.
From official figures, they say that rent arrears for some Scottish councils over the past two years have increased along with fuel debts and other household costs.
For people living in Scotland who are struggling to repay their debts, the first effective step they can take is to speak with an experienced debt adviser about what they can do.
For those who are interested, there’s a team of debt advisers at Scotland’s Trust Deed who will be able to give impartial advice that may help.
Among the tips may be to undertake a trust deed which enables someone living in Scotland to write off their unaffordable debt.
A trust deed is a legal agreement
This route is particularly attractive to those who own their own home since they will keep possession of it but a trust deed is a legal agreement between a debtor and their lenders.
Another similar route out of debt is a debt arrangement scheme which enables someone living in Scotland to repay all that they owe but at an affordable rate.
One of the big plus points for a debt arrangement scheme is that it offers the debtor some legal protection so their lenders will no longer be able to hassle them.
It’s also possible to discuss with an experienced debt adviser about the possibilities of sequestration – or bankruptcy as it is better known.
Also, for those who do not want to speak with an adviser, Scotland’s Trust Deed also have an online form that is quick to complete and offers advice on what financial solutions may be available to them.
Scots who are struggling with their debts
It’s also worth appreciating that for Scots who are struggling with their debts, that there are other financial routes to consider.
Among these, it is possible to consider debt consolidation and write-off as well as considering undertaking equity release, a secured loan or remortgaging.
The debt advisers at Scotland’s Trust Deed will also be able to offer information about informal negotiation with lenders and undertaking a full and final settlement of debts.
Some people in Scotland may also find putting a debt management plan together may also be an ideal solution for resolving debts.
People living in Scotland who are worried about their debts
For people living in Scotland who are worried about their debts and are concerned about calling a debt adviser should be reassured that Scotland’s Trust Deed has helped many people who have contacted them and are willing to help others too.
So, for any Scot who is looking for debt advice, then the team at Scotland’s Trust Deed will be to help with their extensive experience to offer impartial help and they are available to speak with by phone every day.
Bank fees don’t help Scots struggling financially
While the antics of payday lenders and how much they charged people for late or non-payment of loans gained lots of publicity, not everyone is aware that some big high-street banks are charging even more than the payday lenders did for those who fall into unarranged overdrafts.
For people in Scotland struggling with debts, they are finding that the high-street banks are charging rates that are seven times higher than payday lenders – with banks in Scotland among the worst of the offenders.
The research comes from consumer organisation Which? and they are now urging the banking regulator, the Financial Conduct Authority (FCA), to bring in a cap on high unarranged overdraft fees being imposed for current bank accounts.
The FCA is looking into the high overdraft fees
It now appears that the FCA is looking into the high overdraft fees being charged to customers.
Which? has revealed that a customer who dips into an unarranged overdraft for 30 days by £100 could be facing up to £180 in fees – compared with the £24 charge that a payday loan firm would impose.
The survey also reveals that 51% of overdraft users have fallen into an unarranged overdraft and the bank is applying charges over each month rather than for the number of days that the additional money was borrowed.
Essentially, this means a customer could be paying two charges if they are overdrawn for 30 days across two separate months.
Which? points to NatWest, which is owned by the Royal Bank of Scotland, for charging £180 for an unauthorised £100 overdraft.
Customers with Santander or Lloyds could be charged £160.
A spokeswoman for Which? said: “It’s not right that high-street banks can charge people with a financial shortfall that is so much more than would be charged by a payday loan company, particularly if the cash is borrowed over a two month charging period.
‘Consumers will always be hit with exorbitant fees’
“If banks can set the charges then consumers will always be hit with exorbitant fees.”
NatWest says it encourages its customers who are looking to fall into an unauthorised overdraft to contact them for an alternative solution which would help reduce costs.
Santander and Lloyds also said they had similar tools in place that would help customers save and manage their money more effectively.
However, for people living in Scotland there are a number of solutions to debt problems that may be of help.
For instance, they can speak with an experienced debt adviser who will be able to offer impartial help and this may include pointing them in the direction of a trust deed, for instance.
A Scottish trust deed is a method for someone struggling with their debts to repay what they owe at an affordable rate and this could be for up to 48 months.
Big attraction for a trust deed
The big attraction for a trust deed is that the amount of debt that remains when this period ends is considered as unaffordable and could be written off.
There’s also the option of a debt arrangement scheme which is also only available for people living in Scotland.
Again, it’s an effective way to deal with debts and helps provide a debtor with some legal protection from their creditors hassling them.
Under the Scottish government run scheme, the debtor would repay what they owe at an affordable rate but, unlike a trust deed, they would repay everything.
The team at Scotland’s Trust Deed
There are also other potential debt solutions available and the team at Scotland’s Trust Deed will be able to give more help and guidance about debt consolidation and write off as well as a debt management plan and a full and final settlement.
They can also offer advice about sequestration which is a form of bankruptcy.
There’s more information about what someone living in Scotland who is struggling with their finances can do on the Scotland’s Trust Deed website.
Scots could be referred to debt advisers when visiting doctors
One of the issues for Scots struggling with their debts are the health problems their situation may bring.
Now for people in two Scottish cities who are struggling with their money problems may find themselves being referred to a debt adviser when visiting their doctor.
The pilot schemes have been unveiled in Dundee and parts of Glasgow.
The debt advice will be provided by a charity which has received funding for the schemes.
The aim is to reach some of Scotland’s most vulnerable people who despite struggling with financial problems are unlikely to get help.
The recommendation to visit debt advisers may be prompted when the Scottish patient tells their doctor they are struggling with financial hardship and when facing homelessness and housing problems.
Scots who are struggling with debt and money issues
The charity involved in the scheme say Scots who are struggling with debt and money issues are often those who are below the radar with other services and they may only ask for help when they are suffering with a medical issue.
Those being targeted under the scheme include young adults on benefits as well as working age adults who are falling into debt and struggling financially.
A spokeswoman for the charity said it is well known that the pressure and stress for those who are struggling financially, particularly when their home is under threat, will cause ill health.
The charity says it’s hoping to reach those who are less likely to ask for help with their debts and often live in some of Scotland’s most deprived areas.
Should the pilot schemes be a success, those involved are hoping that the schemes will be expanded to other areas of Scotland.
There is no doubt that struggling with debt is a growing problem in Scotland but Scots do not have to suffer in silence when there is help available.
Debt advisers who can offer impartial guidance
For instance, there is a helpful team of debt advisers who can offer impartial guidance at Scotland’s Trust Deed.
They are available to contact every day by phone and have helped thousands of Scots already with their money problems.
Among the potential ways people in Scotland can resolve their debts is to opt for a trust deed which is an effective way of repaying at a rate they can afford and is generally over a longer term; it can be up to four years.
The big attraction for a trust deed is that the amount of debt that remains at the end of the term is called unaffordable and will be written off.
There’s also the choice of the Scottish government-run debt arrangement scheme which is similar except that all of the debts are repaid over a longer period.
Debt arrangement scheme is a popular choice
The debt arrangement scheme is also a popular choice because it prevents lenders from hassling someone in debt who then gets to enjoy some degree of legal protection.
It should be appreciated that the scheme is effectively a legal arrangement between someone in debt and their creditors and as such it should be respected and maintained. Failure to do so may see their creditors asking for repayment once again.
For more help and information about a trust deed and a debt arrangement scheme, the team of debt advisors at Scotland’s Trust Deed can offer more help and advice and there’s even an online debt test on their website to help people understand what potential debt solutions are available for those who live in Scotland.
Scots in debt fuel a rise in insolvencies
The number of Scots in debt who are struggling to repay their creditors has seen personal insolvencies rise by 7.9% in the final quarter of 2016, compared to the quarter before.
In total, 2,616 Scots were declared bankrupt in the last three months of last year, says Scotland’s insolvency service Accountant in Bankruptcy.
It appears that across the UK, the number of people who are declaring themselves insolvent because of unmanageable debts is reaching ever-higher numbers.
Official figures reveal that in 2016, the numbers rose by 13% on the previous year but they are still lower than the peak that was seen in 2010.
The worsening situation has led to the Bank of England warning that ‘vigilance’ is needed over the rising levels of debt.
‘Ballooning levels of household debt’
Indeed, the bank has been warning about the potential problems that may come because of ‘ballooning levels of household debt’ which are being fuelled, apparently, by the historic low levels of interest rates.
It’s these low rates which is encouraging people to borrow more than they can afford and the bank is now predicting that the levels of personal insolvency will rise through 2017.
However, for people living in Scotland there are ways of managing out of control debts to get back onto a firmer financial footing.
Among those options is a trust deed so the Scot who is struggling with debt will repay what they can afford over a given period of time and the amount that remains is considered to be unaffordable and is then written off.
Take on a trust deed
Not everyone will be able to take on a trust deed but for more information about this and other debt solutions for Scots, there’s a team of helpful advisers at Scotland’s Trust Deed who will be able to offer impartial advice.
Among the other routes available that they may discuss, is that for a debt arrangement scheme which runs along similar lines to a trust deed but there is no amount of debt remaining to be written off. All of the debt is repaid by the debtor.
However, one of the attractions for a trust deed and a debt arrangement scheme is that it will stop the lender from hassling the borrower and there’s an element of legal protection against lenders.
There is the option of sequestration which is better known as bankruptcy and as this is a form of insolvency careful consideration needs to be taken before undertaking this solution.
Team at Scotland’s Trust Deed
The team at Scotland’s Trust Deed can also point someone living in Scotland who is struggling with their debts to other potential debt solutions and these will include debt write-off and consolidation as well as undertaking informal negotiations for a full and final settlement.
There’s also the opportunity of undertaking a debt management plan which will see a debtor repaying the money they owe but a more affordable rate.
As mentioned previously, the Scotland’s Trust Deed debt advisers have the experience to help and their advice is impartial but will help those who are struggling to repay debts to find a solution to their financial situation.
Money worries affect people at work
One of the big problems for people worried about money and how to repay debts is how this affects us in our working lives and this is also true for Scots in debt as well.
A new survey has revealed that a quarter of workers are so worried about their money problems that it affects their ability to do their job properly.
Those are the findings from a survey carried out by CIPD of 1,800 employees and they say that young workers, those aged between 18 and 24, are more prone to worrying with 31% saying money problems is causing them issues.
Indeed, the problem isn’t just about those on low wages struggling with money – one in five people who earn between £45,000 and £60,000 say their financial anxiety is also affecting their abilities at work.
The survey also shows that it is more likely to be women who worry about money than men with 28% of women saying their money worries were a concern.
Employers to focus on their employees’ financial well-being
Now the CIPD is calling on employers to focus on their employees’ financial well-being to help boost productivity and health.
Indeed, when questioned about how financial worries impact on their productivity, the loss of sleep leading to physical fatigue is a great concern for 19% of those questioned.
However, for people living in Scotland who are worried about their financial situation and how to repay debts, help is at hand.
That’s because there’s a helpful and impartial team of debt advisers at Scotland’s Trust Deed who can discuss the potential solutions.
There’s also an online debt test available that will also point people struggling with debts in Scotland in the right direction too.
Ways to resolve debt problems
There are a range of ways to resolve debt problems and for those living in Scotland they include undertaking a trust deed.
The trust deed is an effective way for someone to repay their debts at an amount they can afford and this tends to be over a longer period, which can be for up to four years.
The attraction for a trust deed is the amount of debt that is remaining when the term ends is called unaffordable and will be written off by creditors.
There’s also a similar route available for people living in Scotland which is the Scottish government-run debt arrangement scheme.
Again, this is a way for a Scot to repay their creditors at a lower, more affordable amount and over a longer period of time.
The terms of a debt arrangement scheme
However, under the terms of a debt arrangement scheme, the entire amount will be repaid to creditors.
Indeed, the helpful team of debt advisers at Scotland’s Trust Deed can also discuss other potential avenues for resolving debt in Scotland which may include an informal negotiation with creditors, debt consolidation and write off as well as a full and final settlement.
The advisers can also discuss the merits of a debt management plan as well as sequestration, which is a form of bankruptcy – but careful thought needs to be taken before undertaking sequestration.
For more help and advice for people in Scotland who are struggling with debts and have financial worries, the team at Scotland’s Trust Deed will offer impartial help and advice to put them back onto the road to financial well-being once again.