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With the UK’s householder debt now totaling £1.4 trillion, getting out of this debt has become a serious concern for much of the population. Over the past five years, debt management companies have enjoyed rapid growth as the number of individuals taking advantage of debt solutions. The need for expert advice in this area has never been higher, but the global credit squeeze is having a profound impact on the debt management industry, which could put some companies out of business.

The IVA (Individual Voluntary Arrangement) has become a popular option for individuals in debt, as it involves writing off a portion of the debt, and legally preventing creditors pursuing the indebted individual, who must instead commit to a repayment program, typically over five years.

In 2004, 10,752 UK individuals obtained an IVA. This figure almost doubled in 2005 to 20,293, then doubled again in 2006 with 44,332 new IVAs issued. Debt companies enjoying this growth may have expected the trend to continue in 2007, but instead there was no growth at all, with the number of new IVAs actually falling slightly. Credit problems stemming from the US housing market have brought mixed blessings for the debt industry.

For more information, visit moneysolve.co.uk

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Government officials are wringing their hands with worry regarding the current recession. One thing that could help, however, is a so-called “bad credit” loan. These are special loans extended to those with poor credit, and during recessionary times like these, they represent one of the last lines of defense and one of the best ways to access a line of credit to help weather the storm. Bad credit loans can provide emergency funds to help get back on solid financial footing, or they can be used on a longer-term basis for mortgages and other major but necessary expenditures.

Such loans may be a lifesaver if the situation persists.

• The government may need to raise taxes even more and scale back benefits to offset the nation’s economic problems, which would only put more pressure on the average consumer.

• Petrol prices are going up with no end in sight, and the cost of transporting all sorts of consumer goods is going up as a result. Those increases are being quickly passed along to retail buyers, so that the average UK consumer is bearing the biggest burden of all.

• Banks have been forced to lower their interest rates in an effort to jumpstart the slumping economy. But mortgage lenders, credit card companies, and others who sell their financial services and are experiencing difficult time have not passed those price cuts along to their customers.

If you find yourself faced with the dilemma confronting most of us during these turbulent times, you may want to explore the option of a bad credit loan as a financially prudent alternative.

For more information, visit loansbadcredit.org.uk.

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Following are three tips on reducing your credit card debt and getting credit card savvy.

1. The ‘most expensive’ trap. Your credit card could be made up from various types of debt. Purchases, cash withdrawals and any transferred balances. Each one may have different levels of interest applied. So many people may think they can use the new card especially falling into the trap of ‘interest at 0% on transfers’ this doesn’t mean on all money being used is at 0%. Most of the credit card lenders are actually taking your payment and applying the interest at the highest levels and paying the transferred monies off firstly, sop any money at higher rates is not being paid off. Make sure you avoid this and read the small print as they say; the devil is in the detail. 0% cards are still a good idea, just do your homework.

2. Watch out for ‘direct debit’ trap. You should always look to set up a direct debit for the account, which will take the minimum payment in many cases. But if you desire to pay it off as soon as you can, set the Direct Debit to the minimum amount, and set up reminders for yourself each month to pay off extra, either by standing order or check. As long as the debt is reducing and you know you can afford the extra payments, you should see the debt slowing reducing.

3. The ‘minimum repayment’ traps. As discussed, the worst thing is to pay the minimum each month, especially if there is a fair amount of credit taken. It could take years and years to pay off. Just a few pounds extra each month could make all the difference to you being credit card free much earlier.

For more information, visit debtcounsellors.co.uk

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