Is it possible to clear my debts?
Having debts can be worrying. However, there are lots of options that might help you reduce your debts or clear them altogether.
In this sheet we list 13 options for clearing or reducing your debts. Whether any of the options is right for you depends on your circumstances. For each option there is a link to more detailed information.
- Informally negotiated arrangement
Make offers to your creditors based on how much spare income you have.
- Debt Arrangement Scheme (DAS)
You can apply for a debt payment programme through the DAS if you can clear your debts within a reasonable period (usually 10 years). Interest and charges are frozen and creditors are usually stopped from taking court action.
- Free debt management plan (DMP)
A debt management company distributes the payments offers to your creditors based on how much spare income you have.
- Protected trust deed
As an alternative to bankruptcy, you pay as much as you can off your debts over at least four years.
- Bankruptcy
At the end of your bankruptcy most debts are written off.
- Minimal asset process (MAP) bankruptcy
A way of going bankrupt if you do not have many valuable assets.
- Debt consolidation and credit
Apply to a lender for a loan to clear debts.
- Full and final settlement offer
If you have a lump sum available that will pay off part of your debts, ask your creditors to accept a part payment.
- Write off debt
Ask your creditors to write off debts if you have no income to make any payments, and no savings or assets.
- Equity release
Use the value of your home to raise money to pay debts.
- Pension freedoms and debts
Take money from your pension to pay off debts.
- Selling assets to clear debt
Sell things you own to raise money.
- Help from charitable organisations
Some charities provide help to people in financial difficulties.
