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Everything you need to know about UK Debt Expert and the solutions we advise on

As part of the Creditfix Group we’ve helped more than 250,000 find a solution to their debt problems.

Before our experts can offer advice, however, it’s important to discuss your financial situation at length. This allows us to assess your circumstances fully and discuss all of the solutions available to you.

It’s our responsibility to ensure that you are equipped with enough information to allow you to make an informed decision on how you’d like to manage your debt.

Here we share a little more information about the solutions that could help you and some key details to be aware of.

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The advantages and disadvantages of UK debt solutions

At UK Debt Expert we advise on all solutions to manage your unsecured debt. Here we shine a light on the key considerations, both positive and negative, for each to help you make an informed decision on what’s best for you. 

Advantages & Disadvantages

Individual Voluntary Arrangement (IVA)
Advantages
  • Lower monthly payments based on what you can afford.
  • Protect assets such as your home or car.
  • Unsecured debts included in the arrangement will be written off at the end of the term.
  • Freeze interest on unsecured debts included.
  • Stop pressure to pay from creditors bound by the arrangement.
  • An Insolvency Practitioner will distribute payments to creditors on your behalf.
  • You may get a payment break if your situation changes.
Disadvantages
  • Spending restrictions are put in place during an IVA.
  • Secured debts can’t be included.
  • There’s a possibility creditors could reject the proposal.
  • Homeowners may need to remortgage in the final year.
  • Any windfall over £500 will be put towards your IVA.
  • IVAs are recorded on the public Insolvency Register.
  • An IVA will adversely affect your credit rating and appear on your credit file for six years.

Advantages

  • Repay your debt with affordable monthly payments.
  • Creditors bound by the arrangement can’t take legal action against you.
  • Interest and charges on included debts are frozen.
  • All creditor communication will be handled by your insolvency practitioner.
  • The DAS offers an opportunity to avoid sequestration.
  • Homeowners won’t be required to release equity in their home.
  • You may get a payment break if your situation changes.

Disadvantages

  • No debt is written off and you’ll repay what you owe in full.
  • It can take several years to repay what you owe.
  • The DAS will adversely affect your credit rating.
  • Your arrangement will appear on the public DAS register.
  • Your arrangement may be revoked if you don’t comply with the DAS conditions.
  • You’ll need to abide by a struct budget during the arrangement.
  • Creditors may reject your application.
Advantages
  • Payments are lowered and based on your affordability.
  • Assets such as your home and car are protected.
  • Interest and charges on unsecured debts included are frozen.
  • Debts included in the Trust Deed will be written off at the end of the arrangement.
  • Creditors bound by the Trust Deed can’t take legal action against you.
  • Your Trustee will distribute payments to creditors on your behalf.
Disadvantages
  • It’s possible creditors will reject your Trust Deed proposal.
  • Your wages could be arrested if you don't keep up with payments
  • A Trust Deed will have a negative impact on your credit rating.
  • Homeowners may need to release equity to go towards what they owe.
  • You can’t be a company director during a Trust Deed.
  • You’ll need to abide by spending restrictions during your Trust Deed.
Advantages
  • All debts included in the DRO will be written off after 12 months
  • As of April 6th 2024 there will be no fee to enter a DRO
  • Interest and charges on unsecured debts included are frozen.
  • You won’t need to go to court
  • You are protected from enforcement action by your creditors
  • Interest on included debts will be frozen
Disadvantages
  • Your credit rating will be negatively impacted and will stay on your credit file for six years
  • You can’t open a new bank account when in a DRO
  • You can’t apply if you’ve had a DRO or another form of insolvency in the last six years
  • A tenancy agreement could be affected by a DRO
  • If any of your debts are for goods bought on hire purchase, you might need to give the goods back
  • Your details will appear on the Insolvency Register during the DRO and for three months after it ends
Advantages
  • A DMP won’t be recorded on an insolvency register
  • A DMP shows you’re willing to repay your debt in full
  • Creditors can freeze interest and charges on your debts included
  • DMPs can be changed if your personal situation changes
  • A DMP will reduce monthly payments towards your debts
  • Your DMP provider will deal with creditors on your behalf
Disadvantages
  • You will have to repay your debt in full with a DMP
  • Creditors may reject the offer of reduced payments
  • Your credit score can be negatively affected
  • Your creditors can still take legal action against you
  • Creditors can contact you during the DMP
  • Some DMP providers charge fees for their services
Advantages
  • You can make a fresh start, typically within a year
  • Creditors included can no longer take legal action against you
  • You’ll be able to keep enough money to live on as well as essential belongings
  • If you’re self-employed you can keep items essential for your trade
  • You may be able to keep your home if it has little to no equity in it
  • All creditor communication is handled by the official receiver on your behalf
Disadvantages
  • Your credit rating will be negatively affected for six years after your bankruptcy
  • Personal bankruptcy will appear on a public record
  • You’ll be required to sell your home if it has equity in it
  • You’ll need to pay a fee of £680
  • Some jobs are affected such as company directors, accountant, solicitor of financial services workers
  • You’ll be left with few or no assets of value
Advantages
  • At the end of the agreement you’ll be free of debts included
  • Creditors listed in the order can’t take any further action against you without permission from the court
  • You’ll make a single monthly payment that’ll be split amongst creditors
  • It’ll save you time and effort juggling several repayments
  • It’s a formal agreement which means creditors included must stick to the terms of the agreement
  • There’s no upfront fee - the court keeps 10% of your monthly payment to cover costs
Disadvantages
  • It’s only available for people who have at least one court judgment against them and have under £5,000 of debt.
  • While there’s no upfront fee, the court will keep money from your monthly payments to cover costs
  • Your credit rating will be negatively affected
  • If you don’t keep up with payments the court can apply to take the money directly from your wages
  • An Administration Order will appear on your credit file for six years
  • If you own a car or other high value items, the court may expect you to sell them to pay off some of your debt
Advantages
  • A Debt Settlement Offer can lower your overall debt
  • You can repay your debt quicker by making a settlement offer
  • You’ll repay Debt Settlement offer with a single payment
  • You can avoid any formal insolvency solutions with a Debt Settlement Offer
  • You’ll stop any further action from creditors by making a settlement offer
  • Unlike with other debt solutions, your name won't appear on a public insolvency register
Disadvantages
  • Your credit score an be affected as your debts will appear as partially satisfied
  • You’ll need to make a large up-front payment
  • Creditors may not agree to your settlement offer
  • If you're repaying multiple creditors you will need to work out the outstanding debts owed to each and calculate your repayment.
  • Forgiven debt in DSOs may result in taxable income and liabilities
  • If you’re not able to set up a settlement offer you’ll continue to accrue fee and late payment charges for any money owed
Advantages
  • It’s possible to write off all unsecured debts.
  • Creditors can’t reject the sequestration.
  • Creditors can no longer take legal action to recover remaining debt.
  • The trustee will liaise with creditors, removing the pressure of constant phone calls and mail.
  • Interest, fees and charges are frozen – creditors can only claim for the outstanding balance as at the start of sequestration.
  • If asked to pay a contribution it will be an affordable monthly payment that’s calculated in consideration with your living expenses.
Disadvantages
  • Your credit rating will be negatively affected for six years
  • It’ll be harder to obtain credit in the future
  • Assets such as your home or car may be sold to release funds
  • You must declare that you’re bankrupt to any person you attempt to get credit from - whether it’s an individual or joint application where the credit amount totals £2,000 or more or in all circumstances, where you already have debts totalling £1,000 during the bankruptcy.
  • By entering sequestration, you could breach certain contractual obligations by being made bankrupt such as tenancy and lease agreements, various licenses, employment contracts and hire purchase agreements.
  • There’s a four-year acquirenda term. This means that the trustee has a claim on assets acquired for a period of four years from the date of sequestration, for example inheritance.

Advertising substantiation

  • The Creditfix Group has more than 25,000 Trustpilot reviews
  • 93% of reviews are five stars - that’s 24,545 reviews!
  • The Creditfix Group has more five star reviews than any other company in the debt relief category (as of April 2023).
  • A debt write off amount of between 25% and 75% is realistic, however, the debt write off amount for each customer differs depending upon their individual financial circumstances and is subject to the approval of their creditors. The 81% example has been achieved by 10% of IVA customers in the last 12 months.
  • 96% of Trust Deeds reach protected status each month

Research Findings

UK Debt Expert commissioned research firm Taylor McKenzie to analyse not only our brand and messaging but also the causes of debt and barriers to seeking help for key demographics.

The quantitative and qualitative research, carried out in January and February 2024 with the help of 1001 participants from across the UK, highlighted that debt is an emotive subject, affected by both emotional and economic triggers.

In summary, it found that debt was an emotive subject for the participants. All described debt using terms such as ‘stressful’, ‘worrying’, ‘anxiety’. The extent to which the audience could articulate this varied, but all expressed it in similar terms.

When asked what they believed the key economic drivers of debt were, participants said:

Rising living costs: Increasing costs of energy bills, council tax and food whilst incomes remain stagnant, means people are struggling. Debt is being accumulated to spend on essentials.

Large, unexpected costs: Car-related costs and fines are a sudden strain on finances, particularly if there are no emergency funds or savings available. Without a financial buffer, individuals are forced to resort to credit cards, loans, or other forms of borrowing.

Existing debt cycle: The burden of existing debts, including interest payments and credit card payments, reduces available income for other financial needs, leading to additional borrowing.

In terms of physical and emotional reactions to debt, our research showed that our target audience budgets carefully when managing finances and half say they are in control of their debts.  However, the subject of debt elicits a great deal of fear and shame, leading to feeling low, worry and sleepless nights for a large proportion of our target groups.

Cutting back on spending was revealed as the biggest impact of debt but more than one in three have had sleepless nights and a dread of opening bills.  The negative impacts are more keenly felt by the parents as opposed to other demographics.

 

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We’ve helped over 250,000 people find a way to deal with their debt 

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