A court can issue an Administration Order to cover debts of less than £5,000. While the order is in place, your creditors are not allowed to take any action against you which means no payment demand letters, phone calls or visits from bailiffs or anybody else.

You agree to make regular payments to the court which then distributes it to everyone to whom you owe money. It is free to set up but the court will take 10% handling fee to cover its cost, which is probably going to be a lot less than borrowing the money elsewhere.

To apply you must

• Have at least one County Court Judgement issued against you
• Owe money to two or more people
• Owe less than a total of £5,000

You need to fill out a form N92 which you can get from your local court or you can download one here http://www.hmcourts-service.gov.uk/news/forms/docs/n92_0406.pdf

All Administration Orders are made in one person’s name. Husband and wives have to make separate applications if they share a debt. In some cases the debt can be divided.

If you can’t keep up with the payments, you can go back to the court and ask for reduced monthly contributions. But if you don’t pay the monthly amount, the court can lift the order and your creditors would be free to pursue you again directly for the money.

Once you pay off the debt, you can get a Certificate of Satisfaction. This costs £10.