Debt Management - Kensington Finance

lalabibaby

When my daughter completed her degree she had racked up some debts and overdrafts compounded again when she couldn't get a midwifery job immediately as nobody within commuting distance was recruiting at that time. She did work at a pub/restaurant but this didn't pay megabucks so she paid what she could. When things got too much she contacted a company called Kensington Finance who said they would manage her debts and have them cleared within 12 months. Well 12 months on and on some of them she owes more than she started with because they haven't been making the agreed repayments on time so late fees have been added to the accounts. She is so despondent as she is paying Kensington £300 a month and they seem to be doing very little. The companies she is in debt to are happy to accept a regular monthly payment directly from her (something in hindsight that she should have done in the first place). What she needs to know is how she goes about getting out of the agreement with Kensington. Can she complain to the FOS or is there another body that deals with complaints against debt management companies? Any help would be greatly appreciated. Thanks.

Tixy

Does she have the original paperwork from Kensington? it should give a cancellation clause. If not suggest she writes a letter to say she is terminating her agreement with them and stops the DD/Standing order.
She could choose to give them a months notice but they may take all her final £100 for their own fees.

If they are being difficult about her cancelling she could get advice from citizens advice.

Then she can either do a self managed DMP as you have mentioned or a free DMP with CCCS or Payplan. Even if she chooses to do it herself its worth getting advice from CCCS or similar as they will give her template letters to use. Also she could look on national debtline website who have a lot of useful sample letters.

I'd suggest in her first letter to each creditor she asks for an up to date statement so she can find out the current balance & whether interest has been frozen or not.

GeorgeUK

Also might be worth trying to reclaim any charges.
http://www.moneysavingexpert.com/reclaim/

What they have stated in writing and on the phone are 2 very different things. She would need to be able to prove that Kensington misled her for one of the regulators to take up the complaint. She should definately make a formal complaint to Kensington though as it was their errors that led to charges being incurred and she can state that she was informed that the debts would be cleared within a year which they have clearly not been.

She may be able to offer the creditors a reduced full and final settlement. The first step though is to get hold of any statements if she can and also to see what has or hasn't been paid by Kensington along with the balance outstanding.

GeorgeUK

You could go with one of the free organisations that have a better chance of stopping the interest and charges. Then you'd be reducing that debt by an extra £35 per month

Have you had a statement recently that shows the charges have been stopped?