Case Studies £800pm Reduced to £315

Scenario:

Creditors accept payments of £315 instead of £800 per month from a struggling family.
An individual owed £22,000 on credit cards and loans (joint liabilities with his partner). His partner who had just left work to have her first child was not intending to return to full time employment for several years. Creditors were telephoning virtually every day for payment and foolishly the individual agreed to pay back extra each month without really checking to see if he could actually meet these commitments.

Advice Given:

After completing an income & expenditure form it was soon established that the amount of disposable income after accounting for the necessary household expenditure was £315 although the normal contractual payments to their creditors were around £800 per month. An IVA or bankruptcy was not necessary as there was a far suitable solution; enter into a debt management plan with their creditors but only with the right company, i.e. a non fee-paying one.

The Outcome:

Through our recommended Debt Management Company, DMC, the individual has now entered into an arrangement with his creditors, paying £315 per month. The creditors will be paid in full and will pay a small commission to the DMC, usually around 9%. More importantly this fee is not charged to the individual and although their credit rating is impaired, it is probably helpful that they are not able to obtain further borrowing for the time being.