How To Spot Debt Trouble And Find Solutions to Your Problem

Signs of trouble?
Sometimes debts can build up to the point that they are overwhelming. Here is how to spot the danger signs, so that you can get help if you have debt trouble.
Missing more than one repayment
It is easy to forget to make a payment, or have temporary cash flow problems. However, miss two or more payments in a row, and the people who lent you the money in the first place will start getting worried.
Friendly 'loans'
You may find yourself borrowing money from friends or family, saying it's a temporary thing. On some level, you doubt you'll ever pay it back.
Not opening bills
If you can't pay that entire scary bill, you may be able to at least pay a little of it. Utilities providers often have reasonable repayment plans if you're struggling. But you have to ask for help to qualify for these schemes. Avoiding contact with your creditors (the people you owe money to) isn't a good tactic, and makes them suspect you won't pay, rather than can't pay. It won't go away if you cover your eyes.
Big repayments
If you're paying out 20%, say, of your money every month on repayments that means you're going to feel the pinch. It's a large proportion of your income, and you will genuinely feel like you're struggling. One slip-up and it will be hard to find the money for the next installment. Make sure you're not paying too much interest on your borrowing.
Debts staying the same
If you're paying off as much as you can each month, but your debts are not getting any smaller, this is a danger sign. You are in a vulnerable situation here, and can probably only afford to pay off the interest, rather than reduce what you owe.
Things getting nasty
Whomever you owe money to will eventually take steps to get it back. You could end up being taken to court, and if you have a county court judgment (CCJ) against you, it will affect your credit rating for years, especially if you can't settle the fine within 30 days.
You may also get a visit from the bailiffs, who may take away enough of your personal possessions to sell to cover what you owe. If you have hire-purchase agreements, the creditors may simply take back your car or musical equipment, which could cause serious problems if it's your livelihood.

If you feel it’s about time to face your debt trouble, there is help available. The first step is to do research to determine the best strategy for you. If you can’t afford to make higher than minimum payments, speak with credit counselors and debt consultants. Weigh the pros and cons of each program to determine which one is most suitable for your needs.