People incur debts due to various financial deficits. This is not an embarrassing situation. To have anything in excess is a part of human nature. However, there is a possible risk of becoming a defaulter. To avoid such circumstances, you may take loans to repay the debt. You can repay the debts with the help of debt consolidation loans. This type of loan helps to merge all your existing debts into one single loan.

Debt consolidation loan has low rate of interest in comparison to other loans that debtors take to repay their debts. However, debtors need to take care, because by consolidating the loans, the duration of debts will increase along with the repayment amount. On the other hand, with this process, you can control your monthly cash flow.

Types of Debt Consolidation Loans:

You will be able to combine your debts with the help of taking unsecured or secured debt consolidation loans. Unsecured debt does not require you to provide any security. You will be able to take unsecured debt consolidation loan quickly in comparison to secured debt consolidation loan. There are various websites offering unsecured loans based on individual circumstances.

Debt consolidation loans in UK are targeted towards people with credit issues, which enable them to combine different loans into a single loan. Debt consolidation loan in UK has very less advantages in comparison to conventional loans. People with poor credit rating will find it easy to get this loan. They are sometimes even offered good rates in comparison to other loans, which normal people can also apply for.

Procedure Of Debt Consolidation In UK:

In UK, you will have to apply for a debt consolidation loan through individual lender or a bank. There are certain organisations that specialize in offering such kinds of loans, whereas others specialise in conventional loans such as auto loans or home loans. Most of the times to apply for consolidation loans, you will have to show income statements, information on various debts, collateral or security and a stable residence proof.

After the approval of the loan, you may consolidate it in many ways, as per your convenience. In certain cases, the lender takes care of the payment process or you may receive a credit or check and will be responsible for debt repayments on your own.

Either way, you will use the money borrowed to clear debts. You will not have to pay the outstanding debts. However, you will have to make a payment of a particular sum needed for the repayment of loans.

Generally, debt consolidation loans are given in the form of secured loans in the United Kingdom. It means, to get a debt consolidation loan in UK, you will have to provide some kind of security or collateral such as valuables or precious items. The purpose of taking the collateral is ensuring repayment of the loans. If you are not able to repay the loan, then the lender has full authority to sell the collateral and recover the money you owe.

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Tags: Accounts, Bank, Banking, Credit, Current Account, IVA, Money Management, Savings

Since, last few years there has been a tremendous increase in cases of identity thefts in the United Kingdom. However, with identity theft insurance, it is now possible to protect yourself from such type of intrusion. Identity theft insurance will help you to resolve any doubtful activities, thereby giving you a mental harmony.

In case you become a victim of identity theft, your insurance company will help with the potential problems that may arise and assist you in bringing the financial life again on the track

What Does It Include?

Identity theft insurance covers all the expenses, which you will have to incur, if some one steals your identity. It includes bearing the entire legal cost for defending the criminal charges connected with the identity theft, lost wages (in case you need time to reclaim the identity), cost of telephone calls, redundant loan application charges and so on. Next, if you do not possess identity theft insurance, then you will have to bear all these expenses on your own. Therefore, it becomes very important to have such an insurance policy.

Several financial institutions offer identity theft insurance. To obtain such insurance, you will be required to pay annual fees or monthly fees through direct debit. Most policies cost around £ 3.75 to £ 6.99 each month or £ 45 to £ 84 each year. The insurance company then access your credit report and notifies you by sending alerts, if they come across any changes made to the credit report. Thus, if you have not applied for a loan and your credit report shows the loan details, or if changes occur in the bank account, then insurance company will immediately contact you and will lend a helping hand.

Although, identity theft insurance offers good value, there are typical criticisms about the same, which includes:

1. Identity theft insurance policies give the customers a false sense of protection, as they do not do anything to prevent the identity theft at first sight.
2. These policies do not offer full coverage to the victim. For instance, you may have to incur other expenses such as travel cost, stationery cost, phone bills and so on.
3. At times, you may find it troublesome to claim the amount
4. Some policies do not provide you with legal fees
5. Many policies may not give you lost wages

However, it is always better to shield yourself from the perils rather than regretting later.

Overview:

If you cannot afford to cope up with the money loss, if you lose your credit cards or debit cards and do not know as what to do, having identity theft insurance will be really worth at such times. To obtain the policy, simply contact the insurance provider and obtain details of policies offered by different companies and choose the company, which offers good services and help you with recovering the loss in an easy and quick way.
Thus, although, the cost of having identity theft insurance seems affordable, the benefits it offers are quite limited

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Tags: Accounts, Bank, Banking, Current Account, Debt, Identity Theft, Insurance, Money Management, Pre Pay, Savings, UK Credit Cards

Many people find great difficulty, while dealing with debt related issues. Some of them even think of filing for bankruptcy as the final and only solution to get rid of debt issues. However, with the relaxation in the bankruptcy rules, you need not have to consider bankruptcy as the only resort.

You may solve the debt related issues through various ways, and some of them are:

1. Admit that a problem exists: Calculate your assets and borrowings to get an idea of the financial crises you are facing. You may visit several charity websites, who give free advice on debt management. They will also help you examine your debts.
2. Do not be scared of debt collectors: Stop getting intimidated by people demanding payment over the phone. Such collection agents are being investigated by Office of Fair Trading or OFT, if you complaint them regarding highhanded strategies used by these collectors for recovery.
3. Prioritise your Debts: Give priority to debts and mortgage secured on the property, because you may lose your home and money or any other valued assets you possess by defaulting on any of your loans.
4. Seek informed and free advice: Take expert help or advice from people, who do not charge any money for it. You may consult or take help from different debt organisations. You may also contact the helpline for National Debt on their toll number to seek help.
5. Be careful of commercial companies that offer help with debts: There are number of companies providing help with debts to make money. Beware of such companies, as they have been attacked by loan consolidation and debt management organisations for charging expensive fees for their service.
6. Be careful of organisations providing substitutions for bankruptcy: There is a significant increase in people joining voluntary arrangements. However, such organisations are legally binding and can offer a repayment plan for five years with your creditors. However, such kind of plan may be suitable for certain minority debtors. The fees of such schemes are up to £ 7,000.
7. Maintain Discipline: Several big banks are offering contracts to customers facing difficulties in handling and consolidating their debts to make it a single loan. This process will help you only if the spending is brought under control.
8. Look at alternative and cost effective methods to get rid of debts: Consumer credit counselling service and other organisations can help with setting up free management plans to handle your debts. These organisations will organise payments and negotiate with credit card organisations and banks on your behalf to take care of your monthly payments.
9. Contact your creditors: After you are aware about the amount that you are ready to pay or can afford, contact the creditors regarding the situation and inform them about your status. You may offer them to clear the debts in an affordable manner. Do not offer to pay if the amount is not affordable. Do not assume that your future payments will take care of the remaining debts.

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Tags: Accounts, Bank, Banking, Current Account, Debt, Money Management, Pre Pay, Savings, UK Credit Cards

IVA or Individual Voluntary Arrangement is a formal (legal) debt solution or lawful binding arrangements that permit you to pay back all the debts in reasonable monthly payments over a period of five years. It helps you to remain updated with priority payments such as mortgage, living costs without fearing for the legal actions from your creditors.

After deciding to go for IVA, you will have to submit an application letter to licensed IP (Insolvency Practitioner) firm. Next, you have to disclose your monetary situation and attach copies of pay slips, property valuation, creditors’ statements and latest bank statements. Later the company with which you are dealing will contact you to discuss about the situation.

Procedure In Detail:

If the IP firm accepts your IVA application, you will be included in an IVA programme, wherein the company will assign an IP team for you. That IP team then represents you and contacts your creditors to notify them that they are representing you.

Later, the IVA proposal is drafted, which includes every details such as the amount of money that you need to pay. If you have kept your assets as mortgage with creditors, the IP works on to acquire a stay order that will abstain the creditors from auctioning your assets. The IP also prepares Nominees report, which presents a practical and professional opinion whether the prepared IVA presents an authentic offer or not.

After this process, IP team fixes a meeting with your creditors. This meeting is held to cast vote on decision whether to move ahead with the IVA or not. If creditors cannot make it to the meeting, they can send their opinions through fax or mail. If more than 75% of your creditors vote in favour of the IVA, then it implies that your IVA is going to be accepted.

As soon as your IVA is accepted, you can hold all your monthly payments. After this, the creditors cannot contact you over phone or in person. Also, all the interest as well as charges on your debt gets frozen and you can pay the debts in an easy manner as charted out in the IVA, for a period of five years.

However, if you fail to make payments on time it can lead to the termination of IVA, and you may become bankrupt. Moreover, your home is also at risk, if the IVA fails.

Important Notes:

People who wish to apply and benefit from IVA need to possess the following:

1. They need to be bankrupt
2. They need to have insignificant debt
3. They ought to have enough money to make payments,
4. They need to afford making a payment of £ 200 each month for a period of five years
5. Finally, they have to be employed

IVA is different from bankruptcy. You do not have to advertise in newspaper about IVA. However, IVA is a good mode available to you, as you are not only able to pay your debt properly, but it also gives you respite from those constantly harrowing calls of creditors.

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Tags: Accounts, Bank, Banking, Credit, Current Account, IVA, Money Management, Savings