Debt Management Program the right way to go?

[atsgreig]

We are drowning in debt. So far we have managed to get our minimum monthly payments out each month but we are getting no where. Would a debt management program be a good option for us? What exactly is it?

 

[scribe]

From a personal experience i would say yes ,it got me out of a bloody big hole and i live to tell the tale . I'M NOW DEBT FREE with a very healthy balance sheet .

 

[jo12345]

i got into trouble a couple of years ago, and nearly used a debt management thing they were going to charge me just as much as i was in debt to pay them to sort it out, but then i went to citazens advice
and they helped me

 

[Beachcomber]

Before you go down the IVA route, talk to your creditors yourself first.

Get some professional debt councilling (available free) find out all of your options and communicate with those you owe before payments get missed / they have to chase you.

Debt management / IVA agreements can be emotionally and financially devistating for years - I'd personally treat them as a last resort.

 

[Techsyn]

Luckily I haven't had to do it myself but I have helped a couple of people including my brother out by working with Gregory Pennington. In the case of my brother, he kept answering my routine questions like "everything ok?" with "of course!" One day I doubted it and pressed him further and found out what a dire situation he was in. Loans to pay loans, mortgage four months behind, credit cards maxed out etc. I honestly thought he was doomed. I thought he would lose his flat. He doesn't even earn much. His outgoings were now about twice his income!!

Anyway, GP listened patiently for about an hour and a half on the phone while it was all relayed to them. They said a debt management plan was more appropriate than an IVA. (Explained in the GP website and others).

He now has a new bank account with the Think bank, set up with GP. GP looked at all of his bills and took a list of all of his non secured debt. They added up all of his other outgoings and determined how much he could afford to pay towards his debts. They then negotiated wth various companies to freeze the interest and eliminate those unhelpful charges for late payment letters etc. GP now pay a small amount to each company such that he will be paid up in a few years time. His Think Bank account is in two sections, one part being money ring-fenced by the bank to pay his debts. The remaining part of his wages are transferred to the second part for him to use for food etc. The bank make it impossible for him to spend the money set aside for his bills.

He will survive. I only have experience of GP and they were very helpful and understanding of his problems. I'm sure there are other companies but you could do worse than talk to them.

Good luck.

 

[mpen]

I would never recommend an IVA, I had a business around 16/17 years ago that went pear shaped because it grew to quick, I was told by the bank to factor (that made matters far worse) so with debts of around 14k I made an IVA.

The adminstrater of the IVA bullied me more than people I owed money to, 4 years into the IVA he was struck off for fraud, all the money I had paid in disapeared, a letter was sent out to all my creditors who then stuck four years interest onto the debt and started chasing me again, the worst was the inland revenue and the vat man, it took me over ten years to clear and even longer to re-establish my credit.

one of my old bosses went bankcrupt a couple of years ago, he owed £490k his order was for 12 months, he was driving around in a brand new car 7 days later, stopped in his big house and started a new business within a month.....I suppose its who you know..

 

[gouldie0]

I would speak with the citizens' advice bureau, they give free advice and aren't driving by sales so to speak. A close friend has spoken with GP and thought it better to approach a company that doesn't charge for such a service. Citizens advice will point you in the right direction, good luck whatever route you choose.

 

Without knowing your situation it is difficult to know what to recommend i.e how bad your debts are, what assets you've got etc.

If your debts aren't too bad then you can do it yourself with the help of a charitable organisation such as The national Debtline.

I would steer clear of any IVA's. There is also the bankruptcy option but obviously i do not know your circumstances!

Feel free to PM me or post a few more details and i will try and advise x

 

one of my old bosses went bankcrupt a couple of years ago, he owed £490k his order was for 12 months, he was driving around in a brand new car 7 days later, stopped in his big house and started a new business within a month.....I suppose its who you know..

The stigma has been taken out of bankruptcy of late and most people are being discharged within 6-12 months which means you are debt free. He must have had negative equity on his house though to have kept it though. A lot of people get really bad advice on bankruptcy - spoke to a guy yesterday who was going to sell his house to his dad for £1 as well as his car! He honestly thought the Official Reciever wouldn't pick up on it!

There is also something new come out called Debt Relief Order, but this is for people with negligable assets and debts £15k or under. But it only costs £90

 

[mobyme]

There is plenty of free impartial advice on debt available to you. I personally would recommend the CBA as your first port of call. You can find your nearest office by visiting the site below

http://www.citizensadvice.org.uk/index/getadvice
http://www.nationaldebtline.co.uk/
http://www.cccs.co.uk/
http://www.communitylegaladvice.org.uk/

Whatever you do stay away from debt management companies. All they will do is add to your burden with management fees and there is no guarantee that your creditors will actually receive the money you are handing over. Also remember that if you sign up with one of these parasites you will make it extremely difficult for a professional debt advisor to help you in the future.

 

[wordsinart]

I'm assuming that an IVA is similar to what a 'Trust Deed' is here in Scotland? Kinda one step back from Bankruptcy?

I signed up to a Trust Deed about 7 years ago, having gone into debt for around £175,000 as a sole trader - completely liable for the lot!

To be honest, I think that signing that agreement saved my house, marriage, family, life and sanity - debt of the unpayable kind is a hard place to live.

Seven years on I'd say that, in balance, it was the right thing, but all is not rosy. My credit rating is shoite (as I've not applied for any credit in that time, coupled with the black marks of the trust deed) and, whilst I have a good running business, I cannot be 'seen' to be the owner of it as the banks will not offer business banking to discharged peeps like me.

In reflection I'd advise, if the situation begins to impact on your family, relationships, sanity, throw your hands up and go the IVA route.

If you can stand the pressure, keep going.

Just me tuppenceworth...

 

[alexlang9999]

Yes Debt management programme is beneficial if one can find some good and professional company. But first of all get the total detail of that company and get the information about its experience.

 

Like i said previously it is difficult to recommend a course of action without actually knowing all the details of your debts and assets.

I am not too keen on IVA's and have seen many people shafted by IP's, debt management can be good as a short term solution and of course you pay for a service no matter who you choose.

I can put you in touch with a debt management company if you like but i really would use someone such as National Debtline first.