Government debt help

If you’re struggling to keep up with repayments, there are several government-backed debt solutions you can access. 

Bankruptcy involves selling your assets and sharing the money among your creditors, and could be an option for you if:

• you can’t afford to pay back what you owe
• your possessions are worth less than what you owe

If you declare yourself bankrupt, you’re typically debt free after 12 months.

A DRO lets you freeze your debts for 12 months if you: 

• owe £50,000 or less
• don’t own your own home
• don’t own assets worth more than £2,000
• have £75 or less left each month after paying your essential living costs

Creditors aren’t allowed to pursue you for payment during this 12-month period, and if your situation doesn’t get better by the end of the year, your debts are written off.

An IVA is a legally binding agreement to pay back a portion of your debt over a set period, usually five or six years, at a rate you can afford.

Anything left at the end will be written off.

As long as you make the agreed payments during your IVA, creditors can’t pursue you for payment or charge fees or interest on your debts.

These are formal debt solutions, which means they are legally binding and regulated, and they’ll also impact your credit rating for six years.

If you’re finding it hard to keep up with your debts, then don’t put off asking for help.

We’re here to advise you on debt solutions and help you find the right option for you.

We can also make sure you’re getting all the benefits you’re entitled to and help you set a budget that you can stick to.

Yes.

Breathing space gives you temporary protection from creditors you owe money to.

It lasts for 60 days and during this time: 

• creditors can’t pursue you for money
• interest and fees can’t be added to your debts

Although it doesn’t write off debt, it does help take some of the pressure off and give you time to find a more long-term solution.

You can only apply for standard breathing space through a debt adviser.

We can do it for you if you meet all the criteria - just get in touch with one of our debt advisers.

Aside from debt solutions that let you to write off some, or all, of the amount you owe, you could be released from your debt if you have:

• a serious medical condition
• not heard from a lender about a debt for six years

Read our handy guide to find out more about when and how you can write off your debt.

If you see anyone promoting “government debt consolidation”, then take a step back.

The UK government does not offer debt consolidation loans, so these ads will probably be from private companies.

It’s also worth being wary of companies that only offer one solution, as it may not be the right one for you.

It’s always best to turn to a trusted, regulated organisation for debt advice, so you can be sure you’re getting advice that’s right for you and your circumstances.