Debt advice

ronheathrow

A friend has similar money problems to those i had in the 90's and has asked me for advice. When i had problems there were unscrupulous practitioners that charged very high rates which were not clear upfront, Debt Relief Orders didn't exist, and neither did organisations like Stepchange, so I’m a bit out of date. He has found and seems to favour an organisation called Money Wellness who seem to be very clear in their terms of service, provide free personal advice and free debt management at and around DRO levels of activity, but also seem to clearly state reasonable charges right from the outset in the event that an IVA, bankruptcy or any of the more serious actions need to be taken ( which a sister company would administer). Does anyone know Money Wellness, and have any comments on whether they are as open and straightforward as they seem to be?

MattMattMattUK

Tell him to go to StepChange, or post an SOA on here as a first port of call.

An organisation that claims to help an individual get out of debt by charging them "reasonable" fees whilst being a profit making business, when other alternatives (eg StepChange etc al.) are charities, make your own decision there...

ronheathrow

I did recommend Stepchange and also the Citizen’s Advice Bureau because I felt it important to guide him to make his own decisions rather than slavishly follow my advice, particularly as my knowledge isn’t current. 

The CAB recommended Money Wellness and the “reasonable fees” comment was mine having examined their documentation which seems to include clear guidance on what the potential steps are that could follow. They offer a similar level of free services to those provided by Stepchange, e.g. they’d arrange a DRO free of charge, with direct contact with a human very early, and it’s only in the event of an IVA or bankruptcy being appropriate that other fees would come in. Those fees seem only to be for disbursements to the court and directly associated expenses in the event of bankruptcy i.e. a total significantly less than £1000, and for an IVA only the Insolvency Practioner’s percentage of the monthly settlement is payable (from those monthly payments) with no arrangement fees or upfront charges, unless so demanded by the creditors vote. i.e. Money Wellness seemingly take no payment for their services, any fees are for the court and/or the Insolvency Practitioner. 

The fact that they are CAB recommended seems to add credence to what appears to be a free service at every level, but as I’ve not seen their name anywhere else, I’m asking if anyone has any direct knowledge of that organisation and can confirm that they’re not too good to be true. 

Finally, as a newbie here I’m not familiar with the “SOA” acronym. I’d be grateful for your clarification (which will probably give me a forehead slapping “Duh” moment when I’m told it’s meaning lol)

RAS

Suggest this moves to the main forum rather than CHALLENGES?

Money Wellness is Gregory Pennington rebadged.

They have been given a Government contract to run DROs because Stepchange found them making a loss, and a huge contract to provide debt advice, which doesn't seem to have have exactly the same rules as the contracts for CAB etc.

Stepchange reputedly have the lowest fees for IVAs.

ronheathrow

Forgive my ignorance, but this is my first ever foray onto any kind of wide ranging forum, with sub sections etc, so may i ask if you mean “Debt-free wannabe” to be the “Main Forum” or a higher level? Secondly, do i move there by reposting in the new location? I’ve seen guidance notes regarding politeness and other points of etiquette, but is there anywhere here that explains these basic principles of where to post etc? (I guess the meaning of “challenge “ here is different from my initial interpretation). 

Anyway, i do appreciate the information just provided. It certainly  provides an answer to how an organisation that isn’t a charity can offer support services free of charge to the consumer. 

GrumpyDil

Your post will likely get better responses if moved to the main debt free forum rather than sitting in the sub forum. 

I've reported it to ask for it to be moved. 

MSE_ForumTeam5

Moved as suggested

EssexHebridean

I'd strongly recommend that your friend talks to one of the charities first - Stepchange for example, or if they feel they'd like a slightly more "individual, gentle" approach Christians Against Poverty (you don't have to be Christian, or even religious at all, they are open to all) could be worth a look - that way they will get impartial advice towards the best solution for them, rather than any risk that they could get steered towards an IVA for example, which is frequently not suitable, but is more profitable for the recommending organisation. 

One thing to note is that if a Debt Management Plan is suggested, not only is it free (this is a good way of working out if you are REALLY talking to a charity rather than an organisation "aping" one of the charities) but it is also usually good practice to not rush straight into it, but to hold off for a few months paying nothing to the unsecured debt to allow it to default - this way interest stop and the impact on the credit file is less long-term. The charities - certainly Stepchange - will try to urge people to go straight in as a rule. 

Brie

There's also NationalDebtline which deals with things online and by phone - so convenient for some with busy lives.  There's also Community Money Advice (CMA) which is predominantly face to face but also has a Hub to help those who are close enough to one of their many centres.  CMA is often placed in food banks or set up in association with some churches but like CAP doesn't cater to one religious (or non) group.   

ronheathrow

Thank you all for being so proactive, and from your comments and a bit more general digging around online I think i have everything I need for now. 

In case it’s of interest, I’ll add the following notes
1. References I made to IVA’s and bankruptcy were made to help find an organisation that could offer a full range of services. I don’t think the situation is serious enough to warrant either, but I’m meeting my friend on Thursday and I wanted to be able to vouch for an organisation that was qualified to advise on all options.
2. I had recommended StepChange, but he had gone to CAB in the meantime, and because they referred him to MoneyHelper, he’s become a bit wedded to the idea of dealing with them. I warned him against opportunistic companies, offered to find out what I can and asked him to wait a short while before committing 

2. He had a noncommittal initial chat with MoneyHelper yesterday, and he was advised that, subject to full details being submitted, a DRO would probably be a suitable solution for him, and they would indeed manage the process free of charge. A good sign!
3. I asked what a SOA was, thinking it was probably something like “Statement of Accounts”, but a link in one of your posts led me straight to the correct title and the relevant online forms. 

4. One of your posts gave encouraging info about MoneyHelper, but I struggled to find anything else online, until I stumbled a link to them buried somewhere in the Insolvency Service website. If I can I’ll upload a screenshot of the relevant page. 

Thank you all again, and if I’ve been too lengthy in anything I’ve said, please forgive me. 

Martico

This thread provides an excellent summation of DROs and IVAs, when they're appropriate, when not, and typical pitfalls