What if my circumstances change after debt consolidation?

18 January 2010

Finding the right debt solution can be a difficult task, with all the options on offer. An expert debt adviser can help you to find the right option for your individual circumstances - but what if those circumstances change?

You`ll only be able to enter into certain debt solutions (like a debt management plan or IVA (Individual Voluntary Arrangement)) if you and your lenders are satisfied that it`s a good long-term option. Others (such as a debt consolidation loan) are only appropriate for people who are sure they`ll be able to afford the repayments.

But nobody can accurately predict the future - and if things change, you may find that the approach that used to be right for you no longer meets your needs.

If you have taken out a debt consolidation loan that is no longer right for you, for example, you`ll need to take action quickly - preferably before you start missing payments.

What action should I take?

If you are struggling to meet your debt consolidation loan repayments - or if you`ve already missed payments - it`s important that you contact your lender immediately to discuss your options.

If the change in your circumstances is only likely to be short-term, your lender may agree to a temporary change to your repayments to enable you to get your finances back on track. This could involve reduced payments, or even no payments at all for a brief period of time, but if you`re still charged interest during this time, you may pay more overall.

If your problems are longer-term - for example, your income has dropped and you`re not sure when it`ll rise again - then a specific debt solution may be needed.

There are a number of debt solutions that can help in this kind of situation, with some of the most common being debt management plans, IVAs and bankruptcy. Certain debt solutions are only available to people who owe money to multiple lenders, and this may be an issue for you - talk to a debt adviser to find out more.

Just like when you took out your debt consolidation loan, the right debt solution for you will depend on your circumstances at the time, and it`s always important that you speak with an expert debt adviser about which one is right for you.

For more information on debt solutions, call us today on 0800 074 8639.

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