Dramatic Increase in the Numbers of Calls for Debt Advice

The entire world is in the grips of a recession with businesses scaling back and UK residents, like people everywhere, facing job losses and rising prices. The result is that people who previously were able to meet there monthly commitments without difficulty are now realizing that they are deeply in debt and have nowhere to turn in order to find the money they need to pay their bills. Many are facing repossession of their homes and have to look at the possibility of filing for bankruptcy.

The debt charity, National Debtline, has reported an increase in the calls to their hotline from people who do not know what to do about their financial situations. One caller reports that in an attempt to keep the mortgage payments up to date on her home, she has neglected other payments and now she has creditors looking for repayments.

This is a typical situation with many residents finding themselves owing large amounts of money on credit cards and store cards. These creditors are stepping up their efforts to receive payment and are placing charge orders on residents that could force them to sell their homes.

In Britain today, this is a common situation. The debt advisors on the other end of the line try to calm down the callers and allay their fears by offering them solutions to their debt problems.  One of the ways in which they do this is to explain the legal system to the callers and explain what charging orders mean for them. They highlight the options that the callers have left open and in most cases these are quite limited.

“I am resigned to losing my home,” says one caller to the National Debtline, “I can no longer to maintain it.” The problem with putting a home for sale in an effort to obtain the money needed to repay the debt, however, is not a viable solution. This is because house prices have fallen to the point that the sale will not even produce the money needed to pay off the mortgage and the other debts will still remain outstanding. For most, the only recourse is to file for bankruptcy.

Even to declare bankruptcy is costly. A fee of £495 applies to the court charges for bankruptcy filing and most callers do not have this money available.  There are ways though in which UK residents faced with this possibility can obtain the money for this court fee.

There are charitable organizations from which one can get help in paying the fee. The process of getting help with dent advice through the National Debtline takes about an hour and the caller will receive an application form for bankruptcy and help in paying the fees.

Debt advisors report an increase in calls of this nature in recent months. One of the advisors, Aidan Tidy, says that the calls come from all walks of life. Executives and professionals, who had been earning high salaries, are now struggling to keep up with the payments in order to preserve the lifestyle to which they have become accustomed.

Another caller looking for debt advice, Graham, aged 42, says that in the past he had an impeccable credit record and had no problems making payments on credit cards.  Graham is an office administrator who currently owes about £56,000 and has not possible way of making the current payments.

According to Graham, he had access to lots of credit and that was part of the problem. “I borrowed money with every intention of paying it back, but circumstances change,” he says.  “I was getting lots of aggressive letters from creditors and you just feel lonely and vulnerable.

The calls to the National Debtline have doubled in 2009. In January, 2008, the center received about 800 calls a day. In January, 2009, there are about 1600 calls every day.

Another debt advice service, Citizen Advice, reports that they have also seen a dramatic increase in the number of people who are experiencing problems meeting the payments on their credit cards, secured loans and mortgages, all of which are affecting their ability to continue fighting repossession.  Citizen Advice took 3000 calls on January 5, 2009 and are averaging about 2000 calls a day ever since.

The government awarded more than £ 5 million to National Debtline last year to help it pay the salaries of fifty additional counsellors. When these training positions were advertised, there were more than 5000 applications received.

The problem that many people are encountering when looking for help in debt counselling is that there are many agencies who charge a fee for this service.  National Debtline does not charge for its service and trained advisors will help callers find viable solutions to their money problems.

It is always better to ask for help than to suffer in silence. “The earlier you call the better, but it’s never too late to seek help,” one advisor says,  “If you act in a sensible and open way with your creditors, most of the time you can arrive at a workable solution.”