Credit Cards and Borrowing

With the majority of us having loans, car finance and credit cards our ability to pay them off has now been put into question.


So what are the credit card companies doing to help us during this stressful time?

The first thing you should do is contact the credit card companies and let them know you are on reduced income and having difficulties. Don’t just miss a payment.

If you are struggling you can ask for a payment freeze and a positive side of this is that your credit rating won’t be affected by a temporary freeze due to the Corona Virus hardship if you have to repay:

  • Credit cards
  • Store cards
  • Personal loans
  • Guarantor loans
  • Logbook loans
  • Home collected credit
  • Certain Credit Union loans
  • Loans from Community Development Finance Institutions (CDFIs)

Also, these lenders would have to be regulated by the Financial Conduct Authority (FCA) for these rules to apply. The FCA have asked firms who supply buy now pay later arrangements, certain car finance hire purchase or Personal Contract Purchase (PCP) and Payday Loans to come up with a package of support measures.


What your lender will discuss with you?

If you request a temporary payment freeze, your lender is required to explain what this will mean for you in the future.

This will include information on any increases to your repayments after the payment freeze ends and any interest payments built up over this time.

Firms are not prevented from changing interest during the payment freeze and credit card providers might ask you to make token payments of less than £1 during this time.

Lenders and providers might decide to give you another option other than a three month payment freeze.

If you’re expecting your loss of income to be temporary, for example if you have to self-isolate, or care for someone with coronavirus but will then be returning to work, you might be offered a payment freeze of less than three months.

If you’ve only experienced a partial drop in income, you might be able to make reduced payments rather than take a payment freeze.

However, you will need to contact your lender or card provider to discuss these options.

The temporary payment freeze has been introduced for three months, but it might be extended.

If it is not extended, loan and credit card repayments will start automatically once the three month period ends.

If after the freeze you’re still finding it hard to make repayments you should contact your lender or provider to discuss your options.

If you were already struggling with repayments

If you were already having difficulties making payments before the coronavirus outbreak, these new rules will not apply to you.

Any agreements you already had in place with your lender or provider, such as reducing or cancelling further interest charges, will continue to apply.

If you’re struggling to make loan or credit card repayments you should speak to your lender or provider about what options are available to you or get debt advice.


Worrying about debt?

Facing a sudden drop in income if you’re already juggling other debts can have a severe impact on your finances and is probably the last thing you need right now. Don’t let the problem get out of hand. Don’t let it bog you down and keep you awake all night. You may have been managing to make repayments on money you owe but this crisis is going to push you into problem debt.

Although there may be a lot going on in your life that makes it easy to ignore debt, the sooner you get help the sooner you can get back on track.

There is so much free, confidential debt advice out there to support you and you don’t have to face the problem alone. Talking to someone can mean one less problem off your mind. Our advisors at Help Debt Plus are always on hand with free advice to speak with you and help you through all your debt problems and get you on the right road to financial recovery.

Avoid Loan Sharks

Loan sharks are illegal lenders who often target people who are desperate and who can’t get mainstream credit. They might seem friendly at first but borrowing from them is never a good idea – even if you feel you have no other options.

Loan sharks will start out appearing friendly. And if you keep up your repayments, they might stay that way.

But the reality is, even if you do, any money you borrow will come at a very high price.

There are many risks attached to borrowing from a loan shark:

  •  you pay far more in interest than you would through any legal borrowing.
  •  you might be harassed or threatened if you get behind with your repayments – there have been reports of people being intimidated or attacked
  •  you might be pressured into borrowing more money to repay one loan with another, and end up in a spiral of debt that you can never repay.

As hard as it is to believe people could be so unscrupulous, it’s true. They are out there and financial hardship and preying on vulnerable people is their speciality. Don’t be tempted. If you have been approached by someone you think is a loan shark, you need to report them and contact the police if you are in immediate danger.

Find out how to report a loan shark on the GOV.UK website

Help from the Government

If you are short of money, ensure you are getting all of the benefits you are entitled to. There is help out there and sometimes you need a helping hand to guide you.

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Keeping a roof over your head

This BLOG is designed to give you answers to the most common questions we are continually asked.

There aren’t many of us who haven’t found ourselves to be in financial straits at some time or another. But during the Covid-19 Pandemic everything has changed and the challenges we have faced unprecedented. More than ever we need to know what we can do to protect our finances so that we can face the future with hope.

From today, we will be posting advice on what Government and Creditors such as credit card companies, loan providers and others are doing to support customers (eg, you), through the Covid-19 crisis.

The most urgent commitment is to keep a roof over your head. If you have been furloughed, laid off or on reduced wages then you may have struggled to pay the mortgage or rent.

The Government spokespeople announce all sorts of help and advice but it can be a bit overwhelming and anything that applies to your own circumstances tends to get lost a bit.

So yes, help is available, but you should be aware that the options available to you depend on whether your mortgage account was up to date before the crisis began. However, there are other options if you have already experienced arrears before the Pandemic began.


Mortgage payments.

The Government has introduced a number of measures to help people who are struggling financially during the coronavirus crisis. These include mortgage payment breaks. HDP staff can advise you about this.

If you had mortgage arrears before the virus, there is help available but you should contact your creditor as soon as possible to discuss what options are available to you.

Although you could fear that your home will be repossessed, this is always a last resort and you’ll be surprised at how much help there is for you providing you face up to the problem and meet it head on before things get out of control. HDP can guide you through it all if you are anxious about doing it yourselves.

If you don’t pay your mortgage on time your provider will contact you to find out why and what the problem is. Don’t ignore them hoping they’ll go away and leave you alone. They won’t and they’ll be far more amenable to help you if you acknowledge the problem and do something about it.

They will usually give you the option to pay what you owe in full or consider an agreement to pay the arrears in instalments if you can’t pay the full amount.

But what if you rent?

If you are in arrears with your rent, your landlord or letting agency can take steps to evict you. You do however have the chance to avoid this. So it is vitally important that you address your problem immediately.

If you haven’t yet contacted your landlord about your arrears you will need to do this straight away. Don’t forget, many landlords have mortgages on the property you are renting so they aren’t being necessarily unfair to you to badger you for their rent. They have to deal with the mortgage company themselves. It can become like a line of dominoes falling. They will appreciate your efforts to get back on track and HDP can help you put together a budget and work out how much you can afford to pay. This can be shown to your landlord by way of a new payment arrangement so they can see you are offering them the most you can manage rather than just not pay anything at all. But once agreed, you really must keep to this new payment arrangement. Also, if they don’t agree, or if they don’t reply, it is very important you make the payments anyway.

As always, it’s really important to have help and advice from those in the know. That’s why HDP and their staff are ready at the end of the telephone to help you through this difficult time. People who HDP have helped in the past always say that the first phone call is the most difficult but once they’ve got through and explained their problem, the relief they felt was incredible.

Why you should contact us today?

  • Help Debt Plus give FREE advice
  • We are Authorised and Regulated by the Financial Conduct Authority
  • Our Debt Advisors are mature, professional and experienced whilst providing a confidential service.
  • They have over twenty years experience in helping people just like you.

Next time we’ll be dealing with Credit Card debts.

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Welcome to Help Debt Plus


Welcome to Help Debt Plus’s BLOG – brought to you to offer advice, help and guidance whilst we are all going through the Covid-19 crisis. Who could have imagined that just a year ago, we would be living like this in 2020. It’s been tough, and will probably get tougher – but there are ways in which we can all ease the pressure.

How we can help

At Help Debt Plus, we are here to guide you step by step along the financial road, however rocky it may be. We understand that whilst everyone’s main priorities have been to stay safe and healthy, a major concern has been our finances.

Our advisors have hearing the same issues time and time again from our customers, “How on earth are we going to manage without our regular income?

Depending on your circumstances, Help Debt Plus will aim to find the answers to all your financial questions. We have the ability to help ease the crippling financial pressure from your lenders. So if you are in trouble, we are here to make sure you don’t feel isolated and alone. 

Our Aim

Our aim in starting this BLOG is not to bog you down with financial jargon and unachievable suggestions, but to give you advice you can follow alone or with assistance from us. All of the advice you get from HDP is completely free. You can contact HDP staff via this website, email, or by telephone. 

Specific questions will by their very nature be specific to your own financial circumstances and that’s why a phone call is often the best and quickest way to get answers and set you on the correct path.

So – take care, follow all the guidelines to help the NHS and remember, this isn’t going to last forever so make sure the worries about your finances won’t get in the way when restrictions are lifted.


Written by HDP Blogger, Jill Crewe.

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