There's nothing more frustrating than being bombarded with complicated financial terms that you don't understand. It can often feel like another language and sometimes only increase the stress of being in debt. That's why we've compiled a list of some of the terms you might have come across...
- Bailiffs
- These are the registered individuals who are legally allowed to enter your property and seize goods to sell if you've failed to pay an issued CCJ.
- County Court Judgement
- Also known as a CCJ, a County Court Judgement is a legal ruling that requires you to pay the debts owed to a creditor.
- Credit History
- Your credit history is a detailed financial record of all the money you've borrowed and any owed payments that you've failed to make. It is this data that's used to work out your credit rating.
- Credit Rating
- Every adult in the United Kingdom has a detailed financial file on them which is officially known as a credit rating. It is based on a number of factors including your employment status, your banking records and your credit history, and will be looked at by any company you ask to borrow money from.
- Credit Reference Agency
- These are private companies that keep records of people's credit history. When a borrower applies for a loan, the lender will make a request to the credit reference agency for information about how financially reliable they're likely to be
- Creditor
- This is the person or business who you owe money to.
- Debt Counsellor
- A debt counsellor is the individual who can help you arrange your debt management plan. They'll be an experienced industry professional and so will be in a great position to offer you debt advice. They may also have worked with your creditors before so will be able to negotiate with them to reduce your debt.
- Debt Management Plan
- Sometimes referred to as a DMP, a debt management plan is an agreement that will help you pay back your debt in sizeable chunks that you can afford. Arranging a debt management plan could even result in some of your interest charges being frozen by your creditors.
- Debtor
- A debtor is somebody who owes money. If you're currently in debt then you a are a debtor to whoever lent you the money.
- Loan Sharking
- This is the act of charging an illegally high rate of interest on a loan. Loan sharks often use the threat of violence or blackmail to ensure repayments and should be strictly avoided.
