What is the quickest way to get out of debt?
How can I get out of debt now?
Can I get out of debt in 30 days?
How can I get out of debt quickly?
The quickest way to be relieved of your debts and the stress that accompanies them is bankruptcy; to become bankrupt.
In bankruptcy all your unsecured debts are included and usually within 12 months, and in some instances less then 12 months, the debts are discharged, meaning you no longer owe them. You are debt free and getting a fresh start.
But all this begins the day you file your bankruptcy forms. Once you are declared bankrupt, your creditors are to cease their collection efforts, so the phone calls from bill collectors, and all the letters in the post are to stop. Which makes life a bit easier.
Now there can be a bit of lag time between when you are made bankrupt and your creditors being notified of your bankruptcy, but if they were to contact you during this period of time, you can simply inform them you were made bankrupt and provide them the details of your bankruptcy.
Of course all this does come at a price. By going bankrupt you are in essence stating I can no longer manage my financial affairs and am seeking assistance, and that assistance is in the form of the courts/legal system.
Your finances are then reviewed and overseen by an Official Receiver, who has to approve all your expenditures, and may want to take any assets, such as property, expensive cars, etc, of you for the bankruptcy.
In addition, if you have any surplus of income that exceeds £20, after your allowed living expenses, they can require you to pay into the bankruptcy for a period of three (3) years.
This does not mean you will not be discharged and the debts gone after the 12 months, or that your creditors still cannot contact you, just that the payments may go two (2) more years beyond the bankruptcy.
The other side of this coin is looking at some form of debt management, such as an IVA or debt management plan.
An IVA is a formal arrangement that last for five (5) years. So it could take you five years to be debt free.
A debt management plan can take even longer, in some instances depending on the level of debt you have and your monthly payments, it can take many years.
If you owe 10K of debt and make payments of £100 a month, if all the accounts are frozen to new interest and charges it would take you 100 months or over eight (8) years to be out of debt.
So as you can see, while there are repercussions related to going bankrupt, it is the quickest way to be out of debt.
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