How to get out of debt

Are you wondering how to get out of debt? You’re not alone! In fact, our website is visited by over 12,000 people every month seeking advice on debt matters.

In this article, we’ll answer the following questions:

• How can you get out of debt with no money?
• How can you beat debt collectors?
• What are the best methods to get out of debt?
• Is it better to pay off debt or save money?
• Does being in debt affect your credit score?

We know how hard dealing with debt can be; some of us have been in your shoes. But don’t worry; we’re here to help you understand your options.

Let’s dive in!

What happens if I can’t pay a debt?

There are various options open to you when you can’t pay a debt. So rather than panic and ignore things, it’s best to deal with the problem head-on. Read on to find out more!

How can I get out of debt?

You may be able to get out of debt in various ways. For example, you could wipe some of the debt off altogether. However, choosing the right debt solution is essential because the wrong one could make you worse off.

For example, if you get it wrong you may end up with a debit on your bank statement you know nothing about.

How can I get out of debt with no money?

A debt management program could help you get out of debt if you have no money. That and help from a friend or family member are worth considering.

Another route worth considering is applying for a debt consolidation loan for bad credit if you have a limited income but no savings.

How do I clear debt quickly?

The fastest way to clear debt is known as an ‘avalanche method’. You’ll have to list all your debts with the highest to lowest interest rates in that order.

Then make sure you make the minimum payment on each. After this, any funds left over can be used to pay the debt with the highest interest rate. By doing this every month, you’ll quickly reduce the amount of debt you have.

The one thing you shouldn’t do is sell a car that’s on finance to get out of debt because it could land you in more trouble.

» TAKE ACTION NOW: Fill out the short debt form

What is a debt collector?

A debt collector works for a collection agency. The company they work for may have purchased a debt, or they could be working on behalf of a customer. They contact you to recover money you owe which has gone unpaid. It could be a council tax debt that’s owed or something else!

How can I beat debt collectors?

You can’t really beat debt collectors. But you can make them work for their money. For instance, is the debt too old to enforce? Or you ask them to prove the debt is yours. It’s a request debt collectors are duty-bound to respect.

Also, if a debt collector acts unlawfully or they harass you in any way, it could be grounds to report them and have the debt quashed.

Why not check out our posts on specific debt collection agencies to find a company that’s chasing you for payment owed to them or one of their customers?

What are the best methods to get out of debt?

The best method to get out of debt is to choose the right debt solution to meet your specific needs. There are several which include a Debt Relief Order, or a Individual Voluntary Arrangement (IVA) and Bankruptcy.

However, make sure you don’t hide any assets or money if you enter into an IVA!

Thousands have already tackled their debt

Every day our partners, The Debt Advice Service, help people find out whether they can lower their repayments and finally tackle or write off some of their debt.

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Is it better to pay off debt or save money?

You won’t get more interest on savings than you’d have to pay in interest on your debts. In short, it’s better to pay off any debts before you put any money aside in savings.

For example, it’s a good idea to close a Very Account and pay off money owed than to put the money in a savings account.

How can I wipe my debts without paying?

You have several options when you want to wipe your debts without paying. You could apply for either a Bankruptcy Order or a Debt Relief Order. Both are options worth considering when you don’t have any assets to sell or enough money to pay off your debts.

Does being in debt affect my credit score?

Yes, the amount of money you owe will affect your credit score. In short, you should avoid maxing out on credit cards or taking out too many loans.

What Does It Really Mean to Be Debt-Free?

Being ‘debt-free’ means you owe nothing to anybody. Plus, you will remain debt-free if you pay your credit card balances off every month.

Didn’t find what you’re looking for? Then check out all our other posts!