Thursday, 23 July 2009

How to deal with creditors

posted by debts.org at 02:24

If you are struggling to cope with your creditors, and you have already been refused a consolidation loan or a cheaper credit card to reduce your debts, then it is time to take the bull by the horns and take action.

Make an offer of payment to avoid debt problems

Lenders are always more likely to cut you some slack if you show a willingness to pay something. Even if you can´t afford the total repayments each month, make your creditors an offer of payment, based on what you can afford. Credit card debt affects millions of people every year in the UK.Write to your creditors

Write to all of your creditors, enclosing a copy of your income and outgoings, and make an offer of payment. The worst thing you can do is ignore creditor´s letters and phone calls. Make it clear that eventually you aim to pay them all off in full, and when your financial circumstances are better, you will increase your payments. Even offer to review the situation on a quarterly basis, and ask them to freeze any further interest payments in future.Court action and credit card debts

If your creditors threaten court action, politely write to them and explain that you have made the best offer you can to pay back your debt, and if they insist on court action you will produce evidence of all correspondence to the court. For this reason, keep any copies of letters you have sent and received from your lenders.

The court will be impressed that you have at least made an effort to repay the debts, and this could definitely work in your favour. Credit card companies know that a judge is likely to look favourably on you if you have made an effort to repay the debt, but they are hoping you are unaware of this.Alternatively, if the creditors do not accept your offer of reduced monthly payments, tell them you will have to consider taking out an Independent Voluntary Arrangement (IVA), which should get a quick response.

If they still insist on taking you to court, then so be it, but remember to keep all correspondence and all offers to pay in writing to show to the court. If you are struggling with debt and you think a debt management plan (DMP) or an Independent Voluntary Arrangement (IVA), could help you, contact debts.org today. Our friendly professional staff will give you free advice and guidance, and we will even speak to your creditors on your behalf.

Labels: courts