As the total number of indebted consumers in the UK increase consumers should look at all the debt solutions available to them before going with the first solution available to them such as the drastic solution of the Individual Voluntary Arrangement or further to bankruptcy.

The most debt rich part of the UK is the North East where approximately 18% of adults have unsecured debts of £10,000 or more spread over credit cards, overdrafts and personal loans.

Creditors have realized the increase in loan defaults on their books and now are tightening their lending criteria causing many more loan applications whether unsecured loan or a mortgage to be declined.  The hardest hit consumer is also getting younger in recent times with new research suggesting the average 24 year old now has debts of £16,351 on credit cards and personal loans with the brunt of the debt landing on parents’ shoulders.

Debt Plan Direct case worker, Paul Johnson believes that many people are being denied proper full debt advice and are opting for options such as the IVA, which in many cases is sold to the debtor as the best debt solution when there are other debt solutions such as the less drastic and informal debt management plan.

Paul Johnson one of the most experienced debt case workers at Debt Plan Direct advises that many people do not know where to turn and just go to the first debt solution they come across without weighing up all their options suitable to the debtors individual circumstances.

Many people who struggle with their unsecured debts take out an IVA to alleviate debt problems when there are options such as a debt management plan to help ease the debt burden and have less impact on their credit file.

As many lenders reject loan applications a debt management plan will enable an individual struggling with debts to restructure their monthly payments into a single monthly payment in line with the debtors’ income so the new single payment will be a lot more affordable and realistic.
 
Paul Johnson also advises people to seek help as soon as they feel they may be heading for trouble with their financial situation or if you are currently finding your monthly repayments difficult.