Debt & Financial Advice
Top 10 Debt Tips |
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| 1. Communication |
| Communication
is the key to successful negotiations with
creditors. Do not ignore their letters.
Answer them promptly by letter or by telephone.
If you promise to contact someone by a
certain date, make sure you keep your promise
and contact them even if only to tell them
when you are going to make a payment to
them or advise why there is a delay. |
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| 2. Mind Your Manners |
| It
never pays to get angry with anyone, even
when you feel justified in doing so. Always
be polite and courteous even in the face
of being treated rudely. It takes the wind
out of their sails. If someone is acting
negatively with you and you react negatively,
it always makes the situation worse. As
a debtor your objective is to persuade
someone to be sympathetic to your circumstances. |
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| 3. Don't Take Any
Nonsense |
| Don't
take any nonsense from anyone. 100 years
ago we used to have debtors prisons in
the UK. If this was the case now we would
not have enough prisons to house even a
small proportion of debtors. The worst
that can happen is that a creditor will
obtain a judgment against you and take
money from you on an involuntary basis,
which you can avoid through several ways
explained in this website |
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| 4. Get It In Writing |
| Get
it in writing. Always create a paper trail.
This starts with your records such as invoices,
credit card statements etc. Every telephone
call, letter written/received and offers
made. lways make a note of the date and
time and to whom you have spoken and if
necessary confirm all conversations or
offers
in writing. |
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| 5. Don't Bluff |
| If
you make an offer, make sure that you can
do what you have promised. Don't tell creditors
what you think they want to hear. Tell
them what you really can do making sure
you follow through.
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| 6.
Don't Threaten Your Creditors With Bankruptcy |
| Most
creditors and their agents hear these types
of threats every day. It is a form of stonewalling
that hinders negotiations. Creditors are
likely to become more aggressive and their
standard reply is "go ahead and file".
There is a way to do this indirectly in
the context of portraying adverse financial
circumstances, with an inference that bankruptcy
is a possible alternative in the event
that the creditor does not accept your offer. |
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| 7. Make your offer
as brief and precise as possible |
| Explain
the reasons for your current financial
difficulties and then come to the point
and make the offer. Make the terms of the
offer precise. Do not leave things open
ended such as "things should pick
up during Christmas and I will increase
my payments ". |
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| 8. If You Get into
Trouble |
| If
you get into trouble after you have negotiated
an offer and you can't adhere to the arrangement,
contact the creditor in advance. Attempt
to send a portion of the funds you promised
with a proposal to make up the balance,
or renegotiate the entire proposal. Do
not wait to contact the creditor until
after you have missed a deadline for payment. |
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| 9. Protect Yourself |
| If
you receive Court or official papers, protect
yourself. Make sure you know how much time
you have until a legal response is required
to be filed with the Court. This is usually
set out on the Court or official papers.
Consult with either a Citizens Advice Bureau
or similar organisation or insolvency practitioner/solicitor
regarding your rights or the means to resolve
the claim without going to Court. If you
contact the creditors or their agent and
start negotiating the claim, make sure
the response deadline is postponed to a
date that you can keep to. This postponement
must then be confirmed in writing. |
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| 10. Be Realistic |
| Always
be realistic with your offer. Only offer
what you can actually afford. Ensure you
complete your statement of means as accurately
as possible, not forgetting expenses such
as school expenses, child minding, cigarettes,
TV licence etc. Do not however insult your
creditor by over estimating your expenses,
such as entertainment, dining out etc.
The majority of creditors are fair and
they will expect realistic payments within
your budget. |
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