Introduction

A lot of people have problems with money at some time in their lives. These can happen for all sorts of reasons and this publication aims to give some helpful advice and information on how to deal with money problems.

It is important to understand how you have got into financial trouble and to know how to start sorting out the problems.

Understanding your situation

A good place to start is to work out exactly how much you owe. You can then start addressing the problem.

However hard you try, you will not be able to stop spending altogether, so you should draw up a budget to monitor your essential finances. You should make two lists, one showing how much income you receive each month, and another showing all of your spendings each month.

What to do next – some rules

1. Don’t ignore your debts. They will not go away and the sooner you deal with them the easier they are to manage and sort out.
2. Check you are receiving all the income you should be getting Are there any sources of financial support you may be entitled to e.g. income support or disability allowance? Check with your local benefits office.
3. Contact those who you owe money to. It is better to get in touch with each of them and explain your situation. If they are made aware of the extent of your problem they may accept lower payments for a while to help you recover.
4. Prioritise your debts. If you do not pay the mortgage or the gas and electricity bills you could lose your home, or be left without heat, light or the power to cook with. Non-payment of council tax can lead to Court and a fine.
5. Resist the temptation to borrow more. Consolidation of debts can be a good idea, but only if the repayments are affordable.
6. Lower interest rates. You may be able to lower the interest rate you are paying by shopping around. There are some very low interest rate offers linked to credit cards and you may be able to switch debt to take advantage of them. However, it is essential that you do not use the credit card and that you meet all the required payments to retain the benefits of switching. If you are unable to switch, make sure you pay off the more expensive borrowing first.
7. Keep in touch with your creditors. If you have made an arrangement with those you owe money to, make sure that you keep to what has been agreed. Don’t ignore their letters, and tell them if there are additional difficulties.
8. Debt management schemes and companies can help, but be careful about paying unnecessary fees for these. It is better to make your own agreement with your creditors than to pay extra for someone else to do it.
9. Seek advice. Advice Bureau, Money Advice Service, StepChange Debt Charity and National Debtline offer free advice and help (see below).

How we can help

We provide you with regular statements of your account. If these are needed more frequently, please ask us.

You can also check your balance or ask what items are coming in or going out of your account, either by visiting one of our branches or by phoning your branch. We may ask some questions to check your identity before giving information about your account. You can also check on-line if you have internet banking with us, or at most ATMs in the UK if you have a debit card.

If you have an overdraft or loan with us and are finding managing the debt difficult please talk to us as soon as possible. If we are aware of your problem and the steps you are taking to resolve them we will consider your case sympathetically. We may be able to restructure your borrowing with us and we will give you adequate time to prepare a repayment plan if you need to do so.

Helplines, information sources and organisations which may help

If you are in difficulties, you can also obtain help from debt-counselling and business support organisations. Some useful contacts which provide free advice are:

Citizens Advice Bureaux (www.adviceguide.org.uk or find the local address and phone number in the phone book)
National Debtline (Call 0808 808 4000 www.nationaldebtline.org)
Business Debtline (Call 0800 197 6026 www.businessdebtline.org )
StepChange Debt Charity – (Call 0800 138 1111 / www.stepchange.org)
Money Advice Service (Call 0300 500 5000 www.moneyadviceservice.org.uk)

The British Bankers Association (BBA) issues a helpful advice publication called Dealing with Debt which can be downloaded using the following link
www.bba.org.uk

There are numerous other organisations which provide help and advice, some of whom may charge for their services. You should always check what charges are going to be made before making any agreement with any of them.

Financial Ombudsman Service

If you have a complaint that you cannot resolve with your lender, the Financial Ombudsman Service may be able to help Call 0300 123 9123 or 0800 023 4567 or visit
www.financial-ombudsman.org.uk