Debt advice in the face of a recession
on: October 29, 2008, 6:31 am
Release Author: Debt
Release Summary: Today’s talk of a recession, say Debt Advisers
Direct, should prompt people in debt to review their financial
situation as soon as possible and if necessary seek professional
Release Body: The deteriorating state of the economy should lead
borrowers to review their finances as a matter of urgency, say
debt experts Debt Advisers Direct, following
the Autumn forecast from the Ernst & Young ITEM Club.
on 20th October, the Ernst & Young ITEM Club Autumn forecast 'sees
an economy that has deteriorated dramatically in the last quarter
and is now in recession'," said a spokesperson for Debt Advisers Direct.
"The good news, however, is that the recession is expected to
be both short and shallow, with GDP rising - even if only by 1%
- in 2010."
so, the impact of today’s economic downturn will be profound,”
the spokesperson continued. “By definition, even a ‘shallow’
recession involves a shrinking of the nation’s economy,
with the inevitable consequences: lower spending, higher unemployment,
greater uncertainty about the future, etc.
an individual level, the threat of a reduced monthly income is
likely to lead many to review their financial situation. This
isn’t to say that economic gloom is a good thing, but everyone
needs to stop and take stock of their finances from time to time,
and reports such as this can provide a much-needed incentive to
important for everyone – even people with no debts and significant
savings – but for the millions of UK consumers in debt,
it’s particularly vital. Many people in the UK have grown
used to spending more and more of their monthly budget on debt
repayments. In many cases, those repayments take up almost their
entire disposable income, so if anything happens to their income,
they could almost immediately face a whole range of consequences,
from legal action to bailiffs and County Court Judgments (CCJs)
– to say nothing of the damage to their credit rating.
important thing, of course, is to take action before it's too
late. Seeking professional
debt advice is normally the best way to start - any borrower
could have a wide range of debt solutions available to them, so
it's vital they talk to a professional organisation which understands
every option and can provide impartial debt advice, tailored to
their individual circumstances."
Individual Voluntary Arrangement (IVA) or debt consolidation loan,
for example, could help someone cope with a reduced income –
yet neither debt solution would make sense for someone who’s
fairly sure they might lose their income (or a significant part
of it) in the near future.
borrower who is working, but whose job seems to be at risk, may
be better off with a flexible debt solution such as a debt management
plan: if their income drops, they can ask a professional debt
management company to talk to their creditors on their behalf,
renegotiating their debt repayments as and when it becomes necessary.”
borrowers, in other words, will need to adopt different strategies
to deal with their debts. "There's no 'silver bullet' for debt.
Debt management plans, debt
consolidation loans, debt consolidation remortgages, IVAs,
even bankruptcy - each has its place, but the debt solution that's
right for one person can be completely inappropriate for another.
The key thing is to take the time to get the right debt advice
before making any commitments."
Details: Pennington House
South Langworthy Road
0845 056 6480