Credit Problems? Tackle Them Head On.

Summary: Hate opening the post? Dread receiving the bill and Bank Statements? Sounds like your finances are becoming a problem. The ostrich solution never works when it comes to debts - they just don't go away that easily. Take a tip - there's never a better time like the present to tackle a debt problem - as soon as piling bills give you a knotted feeling in your stomach, face up to the problem. Here's some practical advice. Make savings on your credit card bills. Sav...

Hate opening the post? Dread receiving the bill and Bank Statements? Sounds like your finances are becoming a problem. The ostrich solution never works when it comes to debts - they just don't go away that easily. Take a tip - there's never a better time like the present to tackle a debt problem - as soon as piling bills give you a knotted feeling in your stomach, face up to the problem. Here's some practical advice. Make savings on your credit card bills. Savings should be easy to come by. You just need to make cold calculating use of the special deals that many of the credit cards are offering. Savings can be found by moving your balances to credit cards with lower interest rates and special introductory offers. For example, take advantage of the 0% deals on balance transfers such as that offered by Mint - they'll give you 10 months interest free but there's a 2% balance transfer charge. Marks and Spencer have the best transfer free 0% introductory offer. Their 0% deal lasts 6 months. And ensure the interest you pay on any new purchases is reasonable - better still, since you're now cutting back hard, don't use your card at all! However, if it's not practical to avoid using you card, then try HSBC. They offer 0% for 9 months on balance transfers and new purchase - but they also levy a 2% balance transfer charge. The credit card companies may call you a "rate tart" and hate you for switching around but be hard nosed and regularly move your balances between cards to take full advantage of their introductory offers. Then, when you're a month off the end of a deal, look for a new card and get the balance transferred. Reduce your monthly expenditure with a Debt Consolidation Loan. The purpose of a Debt Consolidation Loan is to reduce your monthly outgoings. You take all your existing loans and credit card balances and roll them together into one loan that gives you a single and lower monthly payment. The lower repayment is realised by reducing the overall rate of interest you pay and spreading the loan repayments over a longer period of time. But as with everything, there are snags to watch out for. After you've rolled up all your existing loans into the Debt Consolidation Loan, don't start reusing the old credit lines you've just paid off. If you do, you'll simply end up digging yourself into a deeper hole and make your position much worse! And there's another aspect you might be forced to consider. If you're a homeowner looking for a fairly big consolidation loan, the lender may want your debt secured against your home. If this happens, think carefully before signing. Remember, if you fail to sustain the agreed repayments, the lender can apply to the courts and force you to sell your house. That would certainly be bad news! Seek help. There's lots of help available to assist people resolve their debt problem. A good starting point is the Citizens Advice Bureau. They're local with 3,200 branches throughout the UK and are there to help. Then there's the Consumer Credit Counselling Service. Through its free national telephone service and eight centres, the Service is able to help people with debt problems throughout the UK . Their specialist skills have already helped thousands of people by providing counselling on personal budgeting, advice on the prudent use of credit and, where appropriate, managing plans to repay debts. You'll find their web site at www.cccs.co.uk or phone them on 0800 138 1111. There's also the National Debtline. This is a confidential, free and totally independent source of debt advice. Visit their web site at www.nationaldebtline.co.uk . On their site you'll find a free information pack with a personal budget section, debt advice and free fact sheets. Alternatively, phone them on 0808 808 4000. Debt Management Plans. If your debts exceed