Train passengers have seen fares rise by up to 11%, causing worries about their debt management to grow.
A critical report by MPs has slammed the franchised rail system, which it labels “perverse”, and claims that consumers are taken for granted.
The privately owned rail franchises have upped ticket prices by up to 11% on some routes, despite the country being in recession, adding to the debt problems of passengers that rely on the rail system to get to work.
Debt advice organisations have attacked the timing of the rises, claiming that debt problems will increase for some passengers.
Ivan Cooper, Chairman of the UK’s leading debt management firm Chiltern, said: “To raise rail fares at a time of negative inflation will surely only add pressure to many passenger’s finances and could cause more to suffer with debt problems.
“As more people are feeling the financial pinch, with rising unemployment and the recession, so people’s debt management issues become more apparent – especially when everyday items like your travel to work is suddenly increased.
“Passengers that rely on the rail network to get to work, and who are finding they are struggling to keep on top of their debt management, could benefit from seeking some impartial debt advice.”
Debt advice organisations can provide a number of ways to get out of debt for people who are finding it difficult to keep on top of their unsecured credit commitments – such as personal loans, overdrafts, store cards and credit card balances.
In many cases simple budgeting and debt advice can relieve finances, but in some circumstances a professional debt help solution may be required.
Reputable debt advice companies, like The Debt People, Hamilton Locke and Chiltern, offer a range of professional debt help solutions (like a Debt Management Plan or Individual Voluntary Arrangement) and provide free debt advice.
A Debt Management Plan (DMP) is a professional debt help solution that simplifies finances by enabling multiple unsecured balances to be repaid with a single affordable monthly payment.
All payments to personal loans, overdrafts, store cards and credit cards etc can be gathered into one monthly payment, which is then distributed accordingly to creditors on a pro rata basis by the debt advice company.
Payments towards these balances are then rescheduled over a longer period of time to make them more affordable. The monthly payment remains affordable throughout the term of the Debt Management Plan, as it is based on your affordability.
This means that if your wages are lower than previously the monthly payment can be reduced too, likewise if your wages increase your payment can be raised to help you pay off balances quicker.
An IVA is a professional debt help solution for people with debt problems, that requires a legally binding arrangement between you and the people you owe money to. Because of this it requires a qualified Insolvency Practitioner to provide IVA advice and support, along with drafting your IVA proposal.
This legal contract protects you from your creditors changing their payment demands or breaking the terms of the agreement.
An Individual Voluntary Arrangement (IVA) works in a similar way to a Debt Management Plan but is repaid over a fixed term – normally within five years. After this time, all remaining unsecured balances are effectively written off and you walk away debt free.
For immediate debt advice, or for further information on professional debt help solutions, please call the number at the top of this page.