StepChange #debtmyths

StepChange_James · 17 December 2012 at 5:19PM

The myth:

There are lots of free debt management companies #debtmyths

The reality:

UK-based fee-charging debt management companies that promote their services as “free” are breaking strict advertising rules introduced on 1st September 2010.

This came after some organisations had been guilty of misleading the public, claiming to offer “free” help and advice in their advertising even though a typical plan from a fee-charging debt management company could cost around £5,000.

You should never pay for debt help. We provide free, impartial debt help and advice with no hidden charges.

Other organisations offering genuinely free debt advice include:

mats84 · 18 December 2012 at 12:14AM

GD2 wrote: »

As CCCS have taken the time to answer Depth Charge, why won't they answer another straightforward question? It isn't a particularly hard question to answer, i.e. as a charity why do you turn people away?

Would be nice to have public clarification, even if only for newbies to the boards on here.

I have had a lot of support from StepChange so I will admit I'm biaised but I think people have got this a little wrong. StepChange exists to provide debt advice and help people with problems to find the right solution for them. If as it has been for me a DMP is the right solution then all well and good but for many people other solutions will be more appropriate. StepChange don't turn anyome away, but if a DMP is not the best option for someone's circumstances then it's only right not to put them on one surely?

GD2_2 · 18 December 2012 at 3:27PM

You are so wrong I'm afraid. If a DMP is a good solution, but your affordability is limited, say less than £100 per month, then CCCS will not help and will pass the burden (don't like using that word but it is the best I can think of) either back to the debtor and advise self help or point to somewhere like CAB.

If self help or CAB is the right way to go when you can afford £50 per month, then why is their offer of help a better route when you can afford, say, £400 per month? Make your own mind up as to the answer to that particular countdown conundrum.

So, yes, they DO turn people away when their assistance could be argued to be most needed. I notice though, that whilst you took the time to make your point, and good on you for doing so, CCCS pointedly ignored a very reasonable question.

There are lots of others, but one at a time will do.

System · 18 December 2012 at 5:00PM

The myth: All of your creditors need to agree to your IVA proposal for it to go ahead #debtmyths

The reality:

All of your creditors will be sent a copy of your IVA proposal and will be given a day and time to vote at your creditor meeting.

Not all of your creditors need to accept the IVA terms for your IVA to be approved. The proposal needs to be accepted by 75% of creditors in value who vote at the meeting.

Even if some creditors vote to reject your IVA they can be outvoted by creditors who hold a higher proportion of your debt. Once approved the vote is legally binding for all your creditors, even those who voted to reject it, or didn’t vote at all.

System · 18 December 2012 at 5:12PM

GD2 wrote: »

You are so wrong I'm afraid. If a DMP is a good solution, but your affordability is limited, say less than £100 per month, then CCCS will not help and will pass the burden (don't like using that word but it is the best I can think of) either back to the debtor and advise self help or point to somewhere like CAB.

If self help or CAB is the right way to go when you can afford £50 per month, then why is their offer of help a better route when you can afford, say, £400 per month? Make your own mind up as to the answer to that particular countdown conundrum.

So, yes, they DO turn people away when their assistance could be argued to be most needed. I notice though, that whilst you took the time to make your point, and good on you for doing so, CCCS pointedly ignored a very reasonable question.

There are lots of others, but one at a time will do.

Hi GD2

We only recommend a debt management plan when it’s best advice for the clients own situation. We don’t have any set criteria for affordability and we have no £100 threshold for DMPs.

It’s probably worth emailing us directly if you have any questions about our policies.

Kind regards,

Mat

fermi · 19 December 2012 at 10:24AM

Please keep this thread on topic for discussion of the #debtmyths posts

As requested earlier, if you have other comments/questions then you can post on the main forum/thread, contact via emails etc.

dancingfairy · 19 December 2012 at 10:47AM

Maybe this thread could be kept to the myths by Stepchange and the questions be answered (and linked to) and answered in another thread as the questions should be answered.
df

Former_StepChange_Rachel · 19 December 2012 at 4:51PM

The myth:

Your bank can’t take money from your account without permission #debtmyths

The reality:

This catches out a lot of our clients. If you’ve got debts with the bank that your income is paid to, they can take money to pay towards your debts without warning.

For example if you have a current account and a loan with the same bank and are behind on payments, the bank can take money that’s in your account to pay the loan. Remember that a lot of banks are connected nowadays (Lloyds TSB with the likes of Halifax and Bank of Scotland, for example).

This is called the right of offset (point 4) and if you’re worried about the bank taking your money we recommend that you open a basic bank account with a completely impartial bank.

Lensman_2 · 19 December 2012 at 10:18PM

This is a thread entitled StepChange #debtmyths. From the start it has had a narrow scope.

Posts about the general policies of StepChange should not be posted here - the scope is Debt Myths. Off topic posts may have merit and value, but they dilute the meaning of the thread for posters looking for advice on the subject matter.

Off topic posts should therefore be moderated IMO.

Former_StepChange_Rachel · 20 December 2012 at 4:58PM

The myth:

If you die your family will have to pay off your debts.

The reality:

If you have sole debts and you pass away, creditors can make a claim on your estate if you leave any money or assets. If you have no assets then the debt will die with you.

If you have a joint debt the other person will become solely liable for any outstanding money.

StepChange #debtmyths

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