Millions of people across the UK struggle with debt. At Debt Free Direct, we get asked hundreds of questions about how to clear debts everyday. In this section we've provided the answers to the most frequently asked questions about general debt issues to help you.
If you have financial problems, you might have some questions that aren't covered here. Advisers on the Debt Free Direct helpline can answer other questions you have about clearing debts, as well as give you specific advice on your finances. We can also go into more detailed answers to the questions in our FAQ's. Debt Free Direct is committed to giving free, confidential financial advice that's completely impartial.
- Q: What is a debt management plan?
- Q: Is a secured loan or remortgage right for me?
- Q: Will a consolidation loan help me?
- Q: Can I remortgage if I have a fixed / discounted mortgage?
- Q: How long does the process take?
- Q: Are there any up front fees?
- Q: Who are you regulated by?
What is a debt management plan?
A Debt management plan is an arrangement between yourself and a Debt Management company who agree to supervise and distribute your debt repayments to people you owe money to. Some people can restructure their repayments into a more convenient plan and you won't have to sell your home as part of the agreement. Interest charges are not usually stopped and Debt Management companies may or may not charge a fee for their services.
Is a secured loan or remortgage right for me?
This is down to individual choice, mortgage rates are usually lower and set up fees higher than those of loans because of the length of time involved and your home will be at risk in with both a remortgage and secured loan if you cannot meet the repayments.
Will a consolidation loan help me?
If you can consolidate all of your existing debts into a loan that offers lower total repayments then a consolidation loan might be the best solution; you will save money in the long run and avoid more drastic solutions. This might not be possible in some cases as many people who are experiencing serious financial difficulties tend to have poor credit ratings; if this is the case then taking on more financial responsibility is likely to make your situation worse.
Can I remortgage if I have a fixed / discounted mortgage?
Yes, but you will normally have to pay an early settlement charge to your lender. If your settlement charge is high it might be best to opt for a secured loan.
How long does the process take?
Remortgages normally take approximately 6 weeks and secured loans approximately 3 weeks.
Are there any up front fees?
Not on Secured loans. A remortgage application fee will cover the cost of valuation, mortgage reference and administration costs.
Who are you regulated by?
Our insolvency practitioners are regulated by either the Institute of Chartered Accountants in England and Wales (ICAEW) or the Law Society. We are monitored by the ICAEW. The ICAEW monitors compliance by insolvency practitioners with the insolvency legislation and best practice guidance and assists in attaining high standards within the profession.
