Getting ready for advice (Scotland)

This fact sheet explains what you can do to prepare for an advice session if you want to contact us for advice. However, there are some situations where you should just get advice as soon as you can.

Contact us straightaway if any of the following applies in the next five working days.

• You have sheriff officers collecting any of your debts.
• You are being evicted or made homeless.
• Your gas or electricity supply is being cut off.
• You have a court hearing.
• You have received a letter or court form that gives you a deadline that will expire during this time.

If our phone and webchat services aren’t open, you can find out more about Emergency debt advice on our website.

Your budget

We know that when you are struggling with debt, writing down your income and outgoings might feel like the last thing you want to do. But filling in your budget is the starting point for dealing with your debts.

You can’t know if a debt solution will work for you without doing a budget. All advice agencies will expect you to do a budget before they can discuss your options. Your creditors may also ask for one. A budget shows you:

• what money you have coming in (your income);
• what money you are spending (your outgoings);
• whether you have enough money to pay your essential bills; and
• what is available, if anything, to pay your debts.

This information helps you to find the best solution to deal with your debts.

It also allows you to:

• plan for future spending; and
• protect yourself against the stress that unexpected bills or increased costs can cause.

Call us and we can send you a budget, so you know what kind of information you need to collect.

Gathering information for the budget

Don’t be put off by the amount of information that the budget asks for. You only need details for the sections that apply to you.

Your home

The budget asks you for information about any income that comes into your home and any outgoings needed to cover your essential living costs. To help you get accurate and up-to-date details, take a look at the following, where available.

• Wage slips
• Benefit statements
• Pension-income statements
• Bank statements
• Utility bills (such as gas, electricity and water)

If all your income and outgoings go through your bank account, most of the information you need will be in your bank statements.

Your business

If you are a sole trader or a partner in a business partnership, our budget will also ask for details about your business income and outgoings. As many people find that their business figures change from month to month, gather together your last three months’ trading figures. If you have a separate business bank account, you should be able to find most of this information in your recent business bank statements.

Our budget will use this information to work out what your business can afford to pay you on average each month.

You may have costs that cover both your home and your business, such as a car you use for both. If so, you will need to split these outgoings between your home and your business. If you are unsure how to split the costs, we can talk to you about ways to do this.

If you are a director of a limited company, you will need to speak to your accountant or bookkeeper to find out how much the business can afford to pay you on average every month. Check that the amount is net of any tax or National Insurance requirements.

Priority and non-priority debts

Our budget asks you to say which debts are priority and which are non-priority debts. This will depend on your circumstances, what powers a creditor can use to collect the debt and whether the creditor’s actions can affect your ability to continue in business.

Gather information about all your debts. The budget gives examples of typical priority debts and typical non-priority debts. If you need more help to decide which debts are priorities, our advisers can help you.

Getting information about your debts

You need to gather information about all the debts you owe. This is because the amount you owe and who you owe money to affects which debt solutions are available. The information that you need to gather will also depend upon how you are set up in business.

• If you are a sole trader, you will need to gather information about any personal and business debts that you owe. This is because sole traders are personally liable for all the business debts too.
• If you are a partner in a business partnership, you will need to gather information about any personal debts and any business partnership debts that are owed. This is because partners in a business partnership are also personally liable for most of the business’s debts too.
• If you are a director of a limited company, you are not usually liable for the limited company’s debts unless you have given a personal guarantee. Gather information about any debts that you owe personally and any personal guarantees that you have given. Get separate information about any debts that the company owes. Our adviser will use this information to discuss any debt solutions that may be available for the limited company.

Take a look at the latest letters from your creditors for information about how much is owed. If you haven’t kept the letters, or need more up-to-date figures, call your creditors to ask them how much is owed. If you would prefer not to speak to your creditors, send them an email or letter instead.

If you do speak to your creditors, do not agree to a payment arrangement yet. It is important that you only offer what you can afford to pay. You won’t know what this is until you have done your budget.

If you aren’t sure who you owe money to personally, it may help to get a free copy of your credit report. To get a copy of your personal credit report, contact the credit reference agency and fill in an application form. You can usually apply in writing, by phone or online. See the following section Getting your credit reports.

Getting your credit reports

There are three credit reference agencies, and they may each hold different information about you. So, if you aren’t sure what you owe, it is usually best to get a report from all three agencies.

You can get a statutory credit report for free. This will show all the debts that the agency knows about. You can apply for a statutory report online.

• For an Experian report, go to www.experian.co.uk/consumer/statutory-report.html.
• For an Equifax report, go to www.equifax.co.uk/Products/credit/statutory-report.html.
• For a TransUnion report, go to www.transunionstatreport.co.uk/CreditReport/AboutYou.

You may not be able to get another free statutory credit report if you have received one recently. There may be other ways of getting this information for free. Contact us for advice on how to do this.

If your creditors are not currently contacting you, you may find that they start to contact you again after you make this request. If you are worried about this, contact us for advice first.

Do you have any assets?

We will ask you for information about any assets that you own. This is because:

• some debt solutions can put certain assets at risk; and
• in some cases, you may be able to use your assets as a way of dealing with your debts.

Think about whether you own anything of value (assets), such as a car, your home or stock in your business. If you do own any assets, how much do you think they are worth? Knowing whether you own any assets and their approximate value will help us work out which debt solutions are best for you.