Household incomes across Northern Ireland have been negatively impacted by the pandemic.
Many people here are more financially vulnerable than ever and are finding themselves struggling with debt.
Advice NI and our members across Northern Ireland are here to support with free, impartial and confidential debt advice and we can help anyone who may be struggling financially or who needs help with navigating debt. It’s important for people to realise that they are not alone.
With this in mind, I have compiled a list of some debt solutions that people may not be aware of:
Debt Management Plan
If you’re struggling to keep up with debt payments on things like credit cards, loans and store cards, then a debt management plan may the right solution for you.
A debt management plan (DMP) is an informal agreement between you and your creditors for paying back your non-priority debts, which are things like credit cards, loans and store cards.
A DMP is not legally binding, which means that you can cancel it at any time. It also means that creditors could still pursue you. You can set this plan up yourself with the aid of a debt adviser or it can be managed by a debt solution.
Debt Relief Order
A debt relief order (DRO) is a form of insolvency and may be a viable solution for you if you owe £20,000 or less, don’t own your own home, don’t have other assets or things of value and/or don’t have much spare income.
Your creditors can’t force you to pay off debts whilst a DRO is in place and it typically lasts for a year, this is known as a moratorium period.
During this period there will be other restrictions placed on you but at the end most of your debts will be written off. You can only apply for a DRO every six years. The DRO application fee is £90.
Belfast Live’s money expert Sinead Campbell is Head of Money, Debt and Quality at Advice NI, Northern Ireland’s largest, independent advice provider.
Advice NI and the Independent Advice Network have 69 members and more than 300 advisers across Northern Ireland, providing free and confidential advice to individuals and businesses.
To access Advice NI’s money and debt advice, and free your future, call 0800 915 4604 or visit here.
To apply for a DRO, you would need to speak to a DRO adviser, who will help you to fill in the application and submit it to the Insolvency Service. Advice NI’s debt advisers are trained intermediaries and provide free, impartial, and confidential advice.
Another option for addressing debt problems is bankruptcy. A creditor can make you bankrupt if you owe them £5,000 or more, or you can apply for this yourself if you owe less. Bankruptcy is a legally binding form of insolvency.
Bankruptcy can have consequences for you, it can impact your job and it is expensive. You may wish to consider other debt solutions and speak to a debt adviser to go over all your options.
Bankruptcy usually lasts for 12 months (it can be longer depending on the circumstances) and after this most of your debts will be written off.
Further information on all debt solutions can be found on Advice NI’s website: https://www.adviceni.net/money-talks.
If you do find yourself concerned about managing your finances or struggling with debt during the pandemic you don’t have to face it alone.
You can contact Advice NI by calling the freephone helpline on 0800 915 4604 to speak directly to an adviser between 9am and 5pm Monday-Friday. You can browse our website, www.adviceni.net/debt for full details of the service including contact details and locations of advisers in your area.