Angel Advance: Free Online Debt Advice, DMPs, IVAs & DROs

25/03/2021

Debt Awareness Week - Changes to Debt Solutions

Debt Awareness Week 2021 aims to break the stigma of debt and make debt advice more attainable. Seeking debt advice is never easy, and often comes with worry, humiliation, and embarrassment, changing this is key.

This year’s Debt Awareness Week is likely relevant to more people, in the aftermath of the COVID 19 pandemic. Although it may not feel like it, you’re certainly not alone in needing help and advice with your debts.

If you’re worried about speaking to a debt adviser, you can receive debt advice online, via our Online Debt Advice Tool. Taking some time to understand your debt solution options can really help reduce the worry and offer a way out of the debt.

Proposed changes to Debt Relief Orders (DRO)

Research has shown that the demand for debt advice is set to increase by up to 60% by the end of 2021, so the government has decided to assess whether changing the eligibility of debt solutions, in particular Debt Relief Orders (DRO) will benefit people more and allow a fresh start.

The proposed changes are as follows:

  • Increase the level of surplus income from £50 to £100
  • Increase maximum debt level from £20,000 to £30,000
  • Increase the max value of assets from £1,000 to £2,000

The government are currently assessing the consultation information obtained, to decide if this will be rolled out, it’s due to be confirmed in May 2021, when some other changes are due to happen too.

Debt Respite Scheme (Breathing Space)

On 4th May 2021, the breathing space scheme will come into force and offers legal protection from creditors for up to 60 days for those trapped in problem debt; this includes pausing enforcement action, stopping creditor contact and freezing interest and charges on debts.

Breathing space can only be initiated by an approved Debt Solution Provider, who’re regulated by the Financial Conduct Authority (such as Angel Advance) or a local authority – when offering debt advice to their residents.

The new rules apply to most unsecured debts, including credit cards, rent and council tax. This will offer the time and space to get debt advice, to decide which solution to go ahead with, and get it into place too. Most debt solutions can be set up within a matter of weeks, so there’ll be plenty of time to assess your options and set one up.

Getting debt advice

At Angel Advance, we pride ourselves in being able to offer advice in numerous ways, to suit our clients’ situations. Advice can be offered via telephone, email, or online using our Online Debt Advice Tool. So, if speaking to someone is a worry, you can rest assured knowing it’s not always necessary.

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