Please check / advise on SOA before phone interview with for IVA

UpToMyNeckInIt

...Some very good points here.

This whole business of using CFS figures for one thing, Stepchange Guidelines for others is silly. How can it be acceptable for 'reasonable expenditure' to differ in an IVA, as opposed to BR/DRO?

There should be one set of figures, which are readily available for reference by any interested party.

Hopefully, this is something the debt-management industry will address, but I wont hold my breath.

milliemonster

I should imagine that if CFS guidelines were used as standard, it would possibly rule out many people for an IVA full stop as there would just be no disposable income at all, would possibly have ruled us out, so there's always 2 sides to the coin and a compromise has to be found somewhere I guess.

Depth_Charge

UpToMyNeckInIt wrote: »

...Some very good points here.

This whole business of using CFS figures for one thing, Stepchange Guidelines for others is silly. How can it be acceptable for 'reasonable expenditure' to differ in an IVA, as opposed to BR/DRO?

There should be one set of figures, which are readily available for reference by any interested party.

Hopefully, this is something the debt-management industry will address, but I wont hold my breath.

Hi

This whole issue is undermining certain areas of debt advice and has done for some time now and cannot be allowed to continue.

The CFS is quoted all over the debt advice bodies and organisations (including the OFT) and I believe it is also mentioned on training sites and indeed certain examinations wise for debt advice qualifications.

There are licensed debt advice agencies that use and are expected to use these figures, they also receive the revised figures.

How can accurate advice be delivered if other sets of figures such as the Stepchange ones vary so wildly?

Then we have the HES figures

I have recently seen a growing number of grant applications to external charities such as utilities returned to debt advisers questioning expenditure figures causing extra work, delays and wasting valuable time.

We all know the impact this could have on certain companies and so called not for profit charities, but we don't make the rules and have to deliver accurate advice.

This whole issue perhaps highlights the area where companies and agencies can depend on profit and revenue from their clients debt management plans & IVAs etc.

But people are really struggling and maybe not getting out of debt which I thought was the idea, it cannot go on.

The economic climate has caught a lot of them cold due to rigid marketing and 'business' plans and however much they try to maybe smokescreen the issues they simply wont go away as is now proving to be the case.

Its a tricky one, but its on the agenda now and they all know it.

Like I have said before it is that old independent impartial thing that has returned to haunt.

As previously stated expenditure figures can never be an exact science and there can be a way forward if we sit down and work it out.

It has to be in the interests of those in debt though as I thought that was all this was supposed to be about.

Just my opinions and take as always

Depth_Charge

milliemonster wrote: »

I should imagine that if CFS guidelines were used as standard, it would possibly rule out many people for an IVA full stop as there would just be no disposable income at all, would possibly have ruled us out, so there's always 2 sides to the coin and a compromise has to be found somewhere I guess.

Hi millie

Excellent points here

There can never be an exact science with trigger figure allowances.

Good level headed post this

Thank you

My opinions

FiatFan_2

milliemonster wrote: »

I should imagine that if CFS guidelines were used as standard, it would possibly rule out many people for an IVA full stop as there would just be no disposable income at all, would possibly have ruled us out, so there's always 2 sides to the coin and a compromise has to be found somewhere I guess.

I have a copy of the cccs budget guideline report 2012, if everyone's expenditure were based on the maximum figures I'd expect much fewer people to be accepted to. Although based on the maximum there would be less leeway to discuss variations within the 15% with your IP so a bit of a double edged sword I'd say.

Depth_Charge

Hi

Expenditure trigger figures are now becoming the number one debated subject all over the debt advice sector and not before time.

They have been set to give people protection, a safety net if you like.

Payment arrangements have to be affordable and sustainable whether people enter a IVA, DMP or bankruptcy.

People should not still have to struggle with the basics and essentials after entering payment arrangements and plans.

Children have a right to a life

Advice agencies have to be able to give accurate advice and those seeking advice have to know where they stand when options and solutions are advised and explained.

It cannot be right if they are told one thing only to find that further down the road another agency, company are giving a different interpretation so to speak.

Profit and financial interest are not what independent, impartial advice are all about, the economic situation has to be taken into account.

There can never really be an exact science with expenditure trigger figures however there has to be protection and a safety net, that is one of the main reasons why the figures are formulated, revised and updated.

Advisers have to be allowed to advise and not then be questioned and scrutinised by people and other agencies who perhaps have little or no advice experience or provision.

I understand that the MAS are calling for a universal approach that will help advice agencies, companies and those who want to handle their debts themselves.

How many times do we see posters asking questions on expenditure allowances, give them the information, help them, help dealing with debt become more efficient, smoother and less stressful.

Help people deal with, get out of debt and make that genuine fresh start, after all that's what it is all supposed to be about isn't it?

The economy wins, communities win, people and families win!

The trend is going towards the internet for advice and information for those that can access and use, it is going into mainstream education, times are a changing and the luddite self interest profit making debt management companies and others wont stop it in the long run.

Maybe it would be a good idea to have a thread dedicated to explaining expenditure allowances including the regulatory guidance

Here is a little history on the Common Financial Statement for starters

http://www.moneyadvicetrust.org/images/common_financial_statement_brochure.pdf

http://www.moneyadvicetrust.org/section.asp?sid=14

My take as always

milliemonster

I agree, one thing that gets my goat, being in an IVA myself is when I see people coming for advice about expenditure guidelines and they get responses like 'put down what you spend', how does that help anyone? surely their budget is all to !!!! anyway as that's why they're in debt, I fail to understand why IP's (ok then, SOME IP's) don't like their potential clients to see a list of what is deemed 'acceptable' expenditure in a run of the mill normal household budget.

For us, we were spending around £200 a month on food and groceries for a family of 4 before our IVA, go to the DFW board and they'll tell you you can cut that back further, well yes you can, however, if i had been told to just put that down in our expenditure sheet for our IVA proposal it would have given the creditors an extra £288 a month and no doubt we would be in failure territory now as rightly or wrongly, we use some of our £488 a month grocery allowance to fund the odd day out for the kids, birthday and xmas presents (nothing extravagant, we have no credit remember) and generally to get the car fixed when something goes wrong, or pay for my neighbours new windscreen when my son smashed it by accident last August, remember we have no manoevereability in our budget to go anywhere else when something crops up now so surely it's right to ensure our budget is realistic rather than to the bone.

What I'm saying is that, people in deep do do need to see what a realistic budget is, what they're spending at that point on the essentials is all out of sync as most people try desperately to cut back as hard as they can to afford full debt repayments and other areas of their budget suffers accordingly, they have forgotten what a 'normal' budget is or should be, if there is such a thing.

So IVA companies shouldn't be hiding these figures from their clients, we should be 'allowed' to see what we're entitled to be claiming for, if that is what is deemed a regular budget to give the IVA the best chance of success, and also to give us the opportunity to learn to budget again appropriately.

Depth_Charge

milliemonster wrote: »

I agree, one thing that gets my goat, being in an IVA myself is when I see people coming for advice about expenditure guidelines and they get responses like 'put down what you spend', how does that help anyone? surely their budget is all to !!!! anyway as that's why they're in debt, I fail to understand why IP's (ok then, SOME IP's) don't like their potential clients to see a list of what is deemed 'acceptable' expenditure in a run of the mill normal household budget.

For us, we were spending around £200 a month on food and groceries for a family of 4 before our IVA, go to the DFW board and they'll tell you you can cut that back further, well yes you can, however, if i had been told to just put that down in our expenditure sheet for our IVA proposal it would have given the creditors an extra £288 a month and no doubt we would be in failure territory now as rightly or wrongly, we use some of our £488 a month grocery allowance to fund the odd day out for the kids, birthday and xmas presents (nothing extravagant, we have no credit remember) and generally to get the car fixed when something goes wrong, or pay for my neighbours new windscreen when my son smashed it by accident last August, remember we have no manoevereability in our budget to go anywhere else when something crops up now so surely it's right to ensure our budget is realistic rather than to the bone.

What I'm saying is that, people in deep do do need to see what a realistic budget is, what they're spending at that point on the essentials is all out of sync as most people try desperately to cut back as hard as they can to afford full debt repayments and other areas of their budget suffers accordingly, they have forgotten what a 'normal' budget is or should be, if there is such a thing.

So IVA companies shouldn't be hiding these figures from their clients, we should be 'allowed' to see what we're entitled to be claiming for, if that is what is deemed a regular budget to give the IVA the best chance of success, and also to give us the opportunity to learn to budget again appropriately.

Hi

Thanks again for an absolutely spot on post.

Many of us in the debt advice sector agree with what you are saying.

We are finding it harder to give accurate advice in some areas due to this wild variation in allowances.

We keep seeing people with failed arrangements etc or where they should perhaps have gone down another route as some of them end up doing anyway and likely would have done if they had come to us first.

The advice of 'just put down what you spend' is not sound at all in my opinion for the most obvious of reasons and you sometimes have to ask yourself just who's interest is this type of advice in?

Affordable budgeting is massively important, it is becoming a huge issue across the debt advice sector, Local Authorities and the rest as the economic situation bites along with the introduction of Universal Credit.

The Common Financial Statement is firmly established in the debt advice sector, why then the seemingly reluctance by certain agencies & companies to use or at least embrace it - maybe not too hard really to at least think about the answers.

The issue is not going away however, it has reached a tipping point and they all know it.

My opinions

Depth_Charge

Hi

Discussions on expenditure allowances are nothing new as this 2010 report (I think it was 2010) from CCCS seems to confirm

http://www.stepchange.org/Portals/0/Documents/media/reports/additionalreports/BIS-managing-money-and-dealing-with-debt-CCCS-response.pdf

The whole document is very interesting with Questions 27,28 & 29 of particular relevance on expenditure allowances by the look of it

Question 26 below is also quite interesting with perhaps the answer even more interesting!

Q26. How often do debtors move from one remedy to another and could
the costs be reduced in any way?

There is clearly some movement between remedies and failure to adhere to
remedies for their full duration. For example, many CCCS clients to not stick
to their DMPs for the full duration. Around half drop out due to entering self
administration and half because they are no longer able to pay. If helpful
CCCS could undertake further research on the experience of its own clients.

CCCS are now called Stepchange for those who may not be aware

The economic climate has taken a real dive since 2010 in my opinion and will likely get worse before it gets better