A day in the life of National Debtline - Monday 24 March

National_Debtline

National_Debtline wrote: »

Caller D recently checked her credit file as she is planning on applying for a mortgage. She has discovered a county court judgment from 2012 which was from a dispute. D never recieved the original claim form as she has moved and asks about applying to have the judgment 'set aside'. She also has a car on hire purchase and a couple of credit cards shich she clears every month in full.

As D can meet her credit card and hire purchase payments the main aspect of the call was discussing the set aside process. I explained the two main aspects to an application being successful - the application needs to be made promptly and there needs to be a realistic prospect of success in defending the claim. I made D aware that I had concerns about the promptness element since the judgment is from 2012. The fact that she is looking to deal with the judgment as soon as she has found out about it may allow her application to be considered. Given the fact that we cannot advise on whether or not an individual has prospect in succeeding in a claim I referred D for further advice from her local Law Centre. Brief information about credit referencing and also about hire purchase agreements was also given.

David.

fermi

Very interesting reading and insight. Thank you.

National_Debtline

Caller E was a South Midlands gentleman in his early 60s. He and his daughter lived in a mortaged property which had been on the market for a few month's since E's separation from his partner. Any sort of sale would eliminate his debts and allow them to resettle elsewhere with a degree of comfort, but at present E's benefit income was insufficient to cover the household bills and it seems the mortgage lender was not doing all it could to deflate the pressure in the meantime.

E reported some mental health issues in addition - this is something we commonly see. Sometimes they can be the cause of debt; just as often they are a symptom. What was good to hear was that E was on his way shortly for a face to face appointment with a potential mental health advocate.

National_Debtline

National_Debtline wrote: »

Caller E was a South Midlands gentleman in his early 60s. He and his daughter lived in a mortaged property which had been on the market for a few month's since E's separation from his partner. Any sort of sale would eliminate his debts and allow them to resettle elsewhere with a degree of comfort, but at present E's benefit income was insufficient to cover the household bills and it seems the mortgage lender was not doing all it could to deflate the pressure in the meantime.

E reported some mental health issues in addition - this is something we commonly see. Sometimes they can be the cause of debt; just as often they are a symptom. What was good to hear was that E was on his way shortly for a face to face appointment with a potential mental health advocate.

We were a little squeezed for time given E's pending appointment but there was still time to run through an assessment of his income and outgoings. This confirmed the "deficit" he was operating - at least based on the normal mortgage instalment. I suggested that he - or better still any advocate able to fight his corner - contact the mortgage lender to offer a reduced payment for the duration of his attempts to sell up so that he could at least break even and not have to compromise on other essentials such as basic food shopping. There would be little sense in a lender raising any prolonged objections to this as the level of equity in the property would easily obliterate any arrears accrued in the meantime. A similar approach would suit for the remaining creditors, but they would be offered just £1 per month each for the time being.

I also sought to confirm that E had the use of a "safe" bank account - that is to say, one that was neither overdrawn nor directly accessible by any of his creditors.

The advioce given in a call like this might seem simple, bordering on obvious to the casual observer. However we do our best to put ourselves in the shoes of the caller, who may be seeking advice on debt for the very first time in their life. We can't possibly know every issue affecting them, and it wouldn't necessarily be very helpful even if we did. It is gratifying though to hear a caller becoming audibly calmer during the call, as was the case with E here. All being well he can get the support he needs both practical and emotional, and we have let him know that our door remains open.

Dennis

National_Debtline

Caller F has called us a few times in the last few weeks and is considering her options. She feels that a Debt Relief Order is likely to be the best way forward but has concerns over the fact that she recently purchased a car with the proceeds from a small insurance payout. A few of her creditors are being aggressive towards her, she is receiving lots of calls and letters. She would also like to know what to do about her overdraft.

National_Debtline

National_Debtline wrote: »

Caller F has called us a few times in the last few weeks and is considering her options. She feels that a Debt Relief Order is likely to be the best way forward but has concerns over the fact that she recently purchased a car with the proceeds from a small insurance payout. A few of her creditors are being aggressive towards her, she is receiving lots of calls and letters. She would also like to know what to do about her overdraft.

One of the criteria for a Debt Relief Order is that the applicant cannot have over £300 worth of assets, or £1,000 if the asset is a motor vehicle. As the car's value is below the £1,000 threshold it would not prohibit F's ability to make an application. The other critera are that the total debt needs to be below £15,000 and that the applicant's disposable income is below £50 per month.

As F meets the Debt Relief Order criteria we agreed that it would be the best option for her and an application pack was sent. Within the pack is a sample letter which asks all creditors to hold action whilst the application is being set up, I urged F to send this to any creditor that is currently hounding her for payment. I made clear that the overdraft is a debt, as such it would be included within the order. F was made aware that she would need to switch banks to someone new that doesn't have any outstanding debt with. In addition, the new bank would need to have a policy which allows those under a Debt Relief Order to bank with them. It is likely that this account would be a 'basic' type account. F's application will be handled by somebody called an intermediary. We have a number of intermediaries here, and every applicant will deal with the same person each time they call.

If you would like to know about Debt Relief Orders, here is a link to our fact sheet: https://www.nationaldebtline.org/EW/factsheets/Pages/37%20EW%20Debt%20relief%20orders%20(DROs)/Default.aspx

David.

National_Debtline

Caller G has a small amount of council tax arrears. Although he receives help towards the council tax as he is in receipt of job seeker's allowance, it doesn't cover the full amount. Subsequently he has fallen into arrears and the local authority as obtained a liability order from the Magistrates' court. He also owes a small amount to a family member.

National_Debtline

National_Debtline wrote: »

Caller G has a small amount of council tax arrears. Although he receives help towards the council tax as he is in receipt of job seeker's allowance, it doesn't cover the full amount. Subsequently he has fallen into arrears and the local authority as obtained a liability order from the Magistrates' court. He also owes a small amount to a family member.

I completed a personal budget sheet with G, he had a deficit. With cases like this we would always urge our callers to ensure that they concentrate on their priority debts - such as council tax arrears. As there was already a liability order, emphasis was placed on the caller to act quickly to prevent further action being taken. Local authorities often use bailiffs to recover outstanding arrears, as such advice was given such as keeping the property secure with doors and windows locked. G was also informed to hide his vehicle for the time being.

To prevent the debt getting to the baliff stage I suggested to G that negotiates with his local authority with a view to offering a small amount towards the arrears each week. The local authority may be able to take a small amount directly from his job seeker's allowance each week. £3.60 is usually the minimum amount that would be taken on a weekly basis.

Given the circumstances I pointed out to G that he may need to see if his relative would be happy to wait until he is in a better financial position to await payment of the family loan.

(Here's a link to our council tax fact sheet: https://www.nationaldebtline.org/EW/factsheets/Pages/02%20EW%20Council%20tax%20recovery/Default.aspx)

David.

National_Debtline

Caller H got in touch with us from Scotland, where she lives in rented accommodation with her young son. Her energy company have recommended she seek our advice before trying to arrange an affordable plan for repayment of her arrears.

H is currently in the later stages of her nursing studies and hopes to enter a full-time position in the autumn, which should then make it a lot easier to get on top of her debts and bring them down. In the meantime, though, she is trying to juggle arrangements on a mixture of debts including council tax arrears, an old mobile bill and a cheque cashing service, not to mention that energy bill.

National_Debtline

National_Debtline wrote: »

Caller H got in touch with us from Scotland, where she lives in rented accommodation with her young son. Her energy company have recommended she seek our advice before trying to arrange an affordable plan for repayment of her arrears.

H is currently in the later stages of her nursing studies and hopes to enter a full-time position in the autumn, which should then make it a lot easier to get on top of her debts and bring them down. In the meantime, though, she is trying to juggle arrangements on a mixture of debts including council tax arrears, an old mobile bill and a cheque cashing service, not to mention that energy bill.

A run through H's household budget suggested that ongoing bills were manageable with a degree of organisation and rigour. There was unlikely to be a great deal left over but certainly the basis for a payment plan that would see her steadily chip away at the energy debt for now. It would require H to pare down the existing £20 per month she was offering to a debt collector for some less pressing obligations, however. I also pointed out how much further her money would stretch if she were to open a basic bank account away from her current (overdrawn) facility.

In a scenario like this one, informal arrangements can be perfectly effective to tide the debtor over until an anticipated improvement in their circumstances - in this case the expectation of steady employment upon the completion of the nursing course. There isn't necessarily any need for a 3rd party to intervene on their behalf as long as they understand what they need to do - no doubt many visitors to this forum can vouch for the benefits of the DIY approach, or "assisted self-help". I made sure that H understood the reasons for prioritising certain debts over others and that she could repeat this rationale back to me in her own words - sometimes this "teacherly" approach is worthwhile if one senses that the ground being covered is particularly new and unknown to the caller.

Some callers can be very quiet and passive when you speak to them - in some cases that is how they like to take information in; in others I find myself wanting to make sure that they are taking things on board and/or that they feel able to ask a question twice if they need to.

That's the end of my contribution for the day - I hope you have found it useful. David is sticking around a little longer so I'm sure he will share further tales from the front line!

Dennis