Growing issue with problem debt in Scotland
If you thought you and your debt problems are rare and it’s something to be quiet about then think again because new research reveals that millions of people in the UK are struggling with debt.
One debt advice organisation says its research reveals that one in six of us are struggling with money troubles and have what is termed as ‘problem debt’.
They say individuals who are over-indebted are those who find keeping up with their credit commitments and bills a ‘heavy burden’.
The problem is highlighted if they have missed a repayment in at least three of the last six months.
The organisation says that nearly 16% of people living in Scotland were described as ‘over-indebted’.
Scotland is in eighth place for problem debt
Of the 12 UK regions monitored, Scotland is in eighth place for problem debt with those in England’s north east struggling the most.
However, the organisation says there’s also lots of evidence that points to people struggling with debts receiving free debt advice making a big difference in their bid to get out of debt.
They say that of 65% of those who received debt advice and who were struggling to repay debts had managed to repay them within the next three to six months.
For those who are struggling with money, you should not have to pay for debt advice though there are some firms that do charge a fee.
For Scots who are struggling then there are a number of solutions that will help you get into better financial health.
A trust deed or a debt arrangement scheme
Perhaps the most effective would be to use a trust deed or a debt arrangement scheme.
If you are struggling with your finances and would like helpful advice then it’s time to contact the team of debt advisers at Scotland’s Trust Deed for more help.
They will be able to point you into the right direction to finding solutions to your financial situation.
As mentioned previously, the potential of a trust deed will see you becoming debt free within four years and whatever amount of debt is remaining at the end of that term is then written off as being unaffordable.
Alternatively, there’s also the opportunity of undertaking a debt arrangement scheme, this is run by the Scottish government, and it works along similar lines to a trust deed.
The only difference is that all of the debt is repaid over a period of time and you will be debt free.
People living in Scotland struggling with debt
Both of these opportunities are only available to people living in Scotland struggling with debt and the team at Scotland’s Trust Deed can help with arranging them or assessing whether you will be eligible.
There’s also, for people struggling with money in Scotland, the opportunity of sequestration which is better known as bankruptcy. There are some issues with sequestration which can have a serious impact on your future potential to get credit.
Also, for those who do not want to speak to someone about their debts, there is an online debt test available on the Scotland’s Trust Deed website which will help highlight what help is available and what you can do.
The helpful team of debt advisers at Scotlandstrustdeed.co.uk are available to speak with every day and their advice is impartial but it will prove helpful.
Scots in debt worry about their situation
It should come as no surprise that Scots in debt worry about their situation and around 15% of people develop psychological problems, say researchers.
The findings from a financial firm reveal financial worries also disturb the sleep of 49% of Scots, with 10% struggling to sleep every night.
In addition, around 44% of people living in Scotland say their financial worries tend to impact on personal relationships.
On top of this, 27% of Scots are stressing when they think about their potential financial situation when they retire – though according to figures around 56% of the UK’s population has not managed to save enough to see themselves enjoy a comfortable retirement.
A spokesman for the financial services firm said: “The link about worrying about money and mental health is well-known but what’s less well known is the extent to which our longer-term retirement savings and associated issues contribute to our mental health.
“What is clear is that when people consider the reality of their retirement they recognise they need to be more prepared and are keen to put money aside. This study shows that people need to face up to the reality of retirement and save more.”
People don’t save enough for their retirement
One of the issues that the survey revealed about why people don’t save enough for their retirement is that they feel it’s too far in the future for them to take action.
However, it’s not just our retirement that we should be planning for, our current financial situation also needs close attention.
This is where the debt advisers at Scotland’s Trust Deed can help with impartial advice.
For those who are struggling with their finances, there are some potential routes for resolving debt for those living in Scotland.
Write off an affordable debt
Among them is a Scottish trust deed which will enable someone in debt to write off an affordable debt when their agreement ends.
Essentially, they will enjoy lower monthly repayments over a fixed period, between three and four years, at a rate they can afford.
The amount that remains at the end of this period is considered to be unaffordable and will be written off.
As with most things in life, there are pros and cons about undertaking a trust deed.
Among the advantages is the opportunity to write off a large part of unsecured debt which means things like credit cards, personal loans and a bank overdraft.
The monthly repayment will be vastly reduced and all charges and interest will be frozen.
The aim of a trust deed
The aim of a trust deed is to be completely free of debt when it ends and it’s not as disruptive as bankruptcy, or sequestration for instance.
A trust deed is also easy to set up and can be arranged within six weeks normally.
However, there are some downsides and secured debts such as higher purchase repayments and mortgages cannot be included and all liabilities and assets must be declared.
Also, while the trust deed is in operation, you will not be allowed to access further credit.
It’s also important to appreciate that a Scottish trust deed is a binding contract between you and your lenders and must be respected.
Expert debt advisors at Scotland’s Trust Deed
One of the expert debt advisors at Scotland’s Trust Deed will be able to review your financial circumstances in detail and work out what you can afford to repay every month under its terms.
Obviously, your mortgage, car and living expenses will also need to be deducted before the amount can be determined.
For those people who do not meet the criteria, a debt arrangement scheme may be a more suitable way to repay debts.
This is backed by the Scottish government and will see a debtor repaying all that they owe to their creditors and there’s no amount to be written off when the period ends.
For more help and advice about a Scottish trust deed and the debt arrangement scheme, then speak with the friendly team of debt advisers at Scotland’s Trust Deed.
Scots struggling with debt – what are priority debts?
For many Scots who are struggling with their debts and looking for advice, then they will hear terms such as ‘priority debts’.
But what are priority debts?
Essentially, priority debts are those debts that have serious consequences should you not pay them.
It’s also important to appreciate that they may not be the largest or have the most expensive rate of interest but by not paying them could lead to you creating a serious problem.
For instance, priority debts for people in Scotland will include:
- Council tax
- Court fines
- TV licence
- Gas and electricity bills
- Child maintenance
- Income tax and national insurance as well as VAT
- Rent, mortgage or a loan secured against your property
- Hire purchase agreements (if what you are buying is essential)
Non-payment of priority debts
When we discuss that the non-payment of priority debts could lead to serious consequences this means:
- Losing your home by not paying rent or mortgage payments
- Receiving a court summons
- Being visited by bailiffs
- Having lighting or heating cut-off because of unpaid bills
- Being made bankrupt through non-payment of bills
This then brings us to the issue of non-priority debts and while they have less serious consequences, they still play an important role.
For instance, non-priority debts will include:
- Bank or building society loans
- Personal loans
- Credit card, payday loans and store card debt
- Catalogue, in-store credit and home credit debts
- Money borrowed from family or friends
There’s no mention in either of these lists of water and sewerage bills and while they are considered to be non-priority they should really be included in the household’s essential outgoings.
That’s because the water company is providing the service that you will need to pay for.
Also, the non-payment of water and sewerage bills will mean the amount owed will continue to increase.
Someone in Scotland struggling with debts
So, how does someone in Scotland struggling with debts pay off their non-priority debts faster?
It’s important that you pay the minimum payment at least on all debts so you avoid falling into arrears.
So, if you can afford to pay more, then the money should be targeted to save on interest costs and you will become debt free more quickly.
This means you should really target the most expensive debt first.
The most expensive debt on your list will be the one with the highest rate of interest – it’s also important to check that you will not be charged a penalty or default charge by overpaying.
It’s important to pay what you can afford without breaking the terms of any credit agreement you may have.
Essentially, when you’ve cleared the most expensive debt, it’s time to target the next one and over pay this until it is cleared as well.
Important issues for people living in Scotland
However, one of the most important issues for people living in Scotland who are struggling with their debts is to get advice that will help them overcome their current financial situation.
It may be that they are in an emergency situation and may be going to court or face losing their home. It’s important to act as soon as possible.
It’s also important to appreciate that you are not alone and indebtedness is a growing problem affecting lots of people in Scotland.
One of the big issues is that many people are unsure about the best way they should pay off their debts and it will be time well spent speaking with a debt adviser who can offer helpful advice.
Indeed, Scotland’s Trust Deed have a team of experienced and friendly debt advisers available to offer impartial help and advice.
This means the experts will be useful in helping someone living in Scotland overcome their debts but you don’t have to follow what the debt advisers at Scotland’s Trust Deed discuss.
Scots who want help to repay their debts
So, for those Scots who want help to repay their debts, then the team at Scotland’s Trust Deed can help them with either a debt arrangement scheme, trust deed or even sequestration, which is another name for bankruptcy.
There are various other routes that the advisors can offer advice and help on such as a debt management plan and conducting an informal negotiation with creditors.
If you live in Scotland and are struggling to repay your debts, then it makes sense to speak with the advisers at Scotland’s Trust Deed as soon as possible.
Scots struggling in debt – consider a trust deed
For many Scots who are struggling in debt and wanting to get back into better financial health then a trust deed may help.
Essentially, a trust deed is a voluntary agreement between someone living in Scotland and their creditors, that is the organisations that you will owe money to.
Under the agreement, you will pay back part of what you owe them.
The agreement usually runs for three years, or sometimes for four years, and you will make a monthly repayment on your unsecured debts.
The attraction for a trust deed for many people living in Scotland is that once the repayment period is over, the amount of debt that remains will be written off.
Also, it’s important to appreciate that creditors will not be allowed to add more interest to the amount owed and they will not be able to take further action against you.
What a trust deed can do for you
If you live in Scotland and like the potential of what a trust deed can do for you then you must have unsecured debts such as loans, credit cards or overdrafts.
You must also have excess income – that is money left over after priority expenses and household bills have been paid – to pay down the debt. Or you must have assets that can be sold to help repay the debt.
It’s important for all people living in Scotland who are struggling with debt and tempted to seek advice that they choose an organisation offering free and impartial advice.
That’s because there has been a growth in the number of firms offering financial advice and creating a debt management plan but they are charging a fee for doing so.
At Scotland’s Trust Deed, there is a team of helpful debt advisers who offer impartial advice so there’s no obligation to follow this advice or take up the services offered.
Speak with a debt adviser
For those who do not wish to speak with a debt adviser, or are simply too embarrassed about their financial situation, there is an online debt test available that will reveal what potential solutions may be available.
It’s also possible that if you are struggling financially then a debt management company may approach you and claim that they can help with your debts.
These firms will probably charge a fee for their advice and they may recommend a trust deed even when this may not be the best option for you.
For people living in Scotland, there are a number of ways to overcome indebtedness.
Along with a trust deed, there’s also a debt arrangement scheme which is supported by the Scottish government.
The debt arrangement scheme
The debt arrangement scheme works in a similar way to that for a trust deed and for those who sign up to it will have a part of their income used to repay their debts.
The big difference is that all of the money owed to creditors will be repaid and there will be an amount remaining to be written off.
Depending on your financial situation, some people in Scotland may be tempted by the prospect of bankruptcy, or sequestration as it is known in Scotland.
You can only do this if you have debts of more than £1,500, live in Scotland and have not been bankrupted within the last five years.
However, it’s important that debt advice is sought before undertaking sequestration because there are some serious implications for those who do this; again, the helpful team of debt advisers at Scotland’s Trust Deed will be able to help.
Scots struggling in debt
For all Scots struggling in debt it’s important to appreciate that you are not alone and growing numbers of people in Scotland are finding themselves in a situation where they are struggling to make ends meet. Seeking financial and debt advice is a sound way to resolving your financial situation.
The first step is probably the most important and that is to speak with the friendly debt advisers at Scotland’s Trust Deed who will be able to advise you about any potential solutions and help you along the path to better financial health.
Options for Scots struggling with their debts
Growing numbers of Scots struggling with their debts are looking for potential solutions to their financial problems.
Whether you are struggling to maintain loan repayments or even paying day-to-day bills, there are financial commitments that leave many Scots with little money after these bills have been met.
However, there are several options available to clear debts and the helpful team of debt advisers at Scotland’s Trust Deed will be able to help.
The first step is to find impartial debt advice and this is offered by the advisers with their no obligation advice.
It’s also important to appreciate that you do not have to pay for your debt advice and should be wary about any organisation asking for payment upfront for this.
Indeed, there are companies that will charge a fee for providing a debt management plan and promises to help Scots out of their difficult financial situation.
However, it’s important to appreciate that the same service can be enjoyed for free and, in the case of Scotland’s Trust Deed, there will be more help provided as well.
Debt solutions available for Scots
From the advice and information given, there are a number of debt resolutions available for Scots but these will depend on personal circumstances.
It is also possible to arrange an informal agreement with creditors, these are the people and organisations that you owe money to, and then make repayments based on affordability after household outgoings have been calculated.
It’s also possible that the creditors may freeze the charges and interest on the debt.
Also, it’s important to appreciate that there will be in effect on your credit score which in future may make it more difficult for you to open a bank account or get credit or a loan, for instance.
For people living in Scotland there are a number of avenues unique to the country and one of them is the debt arrangement scheme, which is backed by the Scottish government.
This is a debt management tool that enables someone in Scotland to repay their debts over longer and at a rate they can afford.
The debt arrangement scheme
While the debt arrangement scheme is in place, your creditors will be prevented from harassing you for repayment.
To access a debt arrangement scheme, you need to be based or live in Scotland, have at least one debt and apply to access the scheme through an approved money adviser.
It’s also important to appreciate that you must have cash for food and household bills to live on as part of the debt repayment calculation.
The helpful team of debt advisers at Scotland’s Trust Deed can also help with other issues including a debt management plan.
Again, this arrangement is between your creditors and you to repay what you can on non-priority debts – these are the debts that are not secured against your home. The amount to be repaid is calculated after household bills have been deducted from income first.
The debt management plan will also see a schedule for repayment established and you must stick with it for the plan to remain in place.
For more help and advice about the debt arrangement scheme or a debt management plan, then speak with the helpful team at Scotland’s Trust Deed.