3 tips for managing debt during the Coronavirus pandemic
Employment is a big factor that is being impacted amidst the covid-19 pandemic. A lot of people who currently rely on their income to pay debts are worrying about how their income might fall and how this will affect repayments.
For people in the UK living paycheque to paycheque, even a small impact on weekly or monthly income can trigger a whirlwind of anxiety regarding how debts will be managed alongside bills.
While there is a lot that is shrouded in uncertainty at this time, this article will provide some insight on what to consider if you find yourself in this boat (or worry that you might ).
Consider debt consolidation
There is no certainty regarding how long the difficulties with covid-19 will last. Debt consolidation loans can help make your debt more manageable and reduce the amount you pay over periodic instalments.
Try and arrange a payment break
Amidst all the confusion and panic, you might feel like there’s little choice but to file for debt insolvency such as bankruptcy. While this may seem like the only option, it’s better to take a step back and consider all avenues before jumping into something that can severely damage your credit history for years to come.
Instead, it could be worthwhile seeking out a payment break. Creditors will likely understand your situation given the circumstances and will be more lenient.
Divide debts between priority and non-priority
Separate your priority debts, such as mortgages, guarantor loans and other home loans from your non-priority debts, such as credit cards or loans from family.
Ideally, you want to focus your reduced income on your priority debts more than your non-priority debts. Therefore, you should seek payment breaks for your non-priority debts so that you can allocate more to urgent loans until things begin to stabilise.
In conclusion, while there is a lot of uncertainty about the coronavirus and what to do if/when it impacts your income for the worse, the most important thing is don’t panic. Instead, weigh up your options, consider the tips in this post and seek professional advice where possible. Contact us today to see how we can help and to find out more about the benefits of a debt consolidation loan.