Three ways advised to alleviate debt pain

Consumers whose financial difficulties have escalated beyond their control have three main options available to help them, one publication claims.

According to the Telegraph, people can choose between a debt management plan, an individual voluntary agreement (IVA) or declaring oneself bankrupt, with each solution having its benefits and drawbacks.

Kevin Still, director of Eurodebt, told the newspaper debt management companies "have infrastructures that can handle chasing red letters, court actions and so on", however these arrangements are not legally binding and creditors are under no obligation to accept them.

IVAs meanwhile allow people to repay a proportion of their outstanding debt, which the newspaper claims can be mutually beneficial for lenders and consumers.

Alex MacDermott, credit liaison policy officer at Citizen's Advice Bureau, told the news provider IVAs can be a good solution for some debtors, but are "not the magic wand that makes debts disappear".

Those with no assets can consider declaring themselves bankrupt, which can be less stressful than the aforementioned plans, but does restrict future employment and credit opportunities.

Meanwhile, Brilliant Loans has announced it is to enter the debt management market and will offer customers who have been refused secured or unsecured credit a range of solutions to help resolve their financial difficulties.

Source: http://www.debtmanagementtoday.co.uk/