Some advice please - CCCS vs Paying companies

Dinah93

Hi,

I'm a regular lurker and irregular poster on these boards, and I'm wondering if anyone could give me a bit of advice. It's not for me but for my parents really.

I have known my parents are in debt for a while, and they are on a fixed repayment plan. What I discovered yesterday is they are with a fee paying company called Forest Hall (???) and are paying back £66,000 over 60 months out of the original £106,000 that was owed. They are about 1 1/2 to 2 years into this repayment plan. My mum says that swapping to a fee free company, such as CCCS wouldn't affect their DFD or the ammount repayed, so there is no purpose in switching. Is she correct? I'd love to be able to offer them some advice to help if I can.

She also states that since a lot of this debt is to the bank if they tried to reclaim mortgage exit fees, bank charges or credit card charges this money would be taken seperately to the £66,000 they are already repaying, therefore there is no point in reclaiming to just give the money back to the bank when it won't affect their total or DFD as with above. Again, advice would be much appreciated.

Thanks guys, D x

RAS

Hi

This sounds like an IVA rather than a Debt Managment Plan - given the reduced sum and the length of the term.

Even CCCS charge for IVAs although they rarely advise them. It is much more difficult to get out of this sort of arrangment then a DMP.

There is no harm in them talking to a debt charity but do not be surprised if they cannot move.

chez000

Genrally creditors are quite reluctant (as part of a DMP) to accept repayments for a fixed period and then write off the outstanding balance, which is what I think you describe.

Again generally, the only way they usually agree to write off outstanding amounts is as part of an IVA, so Im wondering are your parents on an IVA or a DMP?

How much have forest hall charged?

In a nutshell the main diff between a DMP provided by a fee free company and a fee charging one is that as the fee free doesnt charge more money is used to pay off creditors with the result that debts are settled quicker.

However if your parents had an IVA then this would not be available from a free provider (advice on an IVA would) as Insovency practioners make a fortune through charging for these.

Being an IP is like having a licence to print money - just my opinion