Posts Tagged ‘debt management plan’

North East UK more in need of debt management

Tuesday, July 27th, 2010

A new research shows that the North East of the country may be more in need of debt management such as Individual Voluntary Arrangements and Debt Relief Orders to deal with debt problems.

The bankruptcy map of the UK was compiled by R3, the insolvency trade body. The results of the study show that the likelihood of becoming insolvent is almost seventy percent (69.5%) higher in the North East than in London.

Commenting on the findings, R3’s President, Steven Law said, “Prior to the recession, the North East had a higher than average unemployment rate and the region’s construction industry was badly hit during the economic downturn so it is understandable that personal insolvencies are more common there.”

There were almost six thousand (5,923) new personal insolvency cases in the North East, which means that for every ten thousand people, 29 of them became insolvent. The figures indicate that people who live in London are least likely to go into a formal insolvency procedure.

A further analysis of the insolvency figures show that recession has hit men harder than women, with a rising number of men seeking debt advice to get on track. According to the Consumer Credit Counselling Service (CCCS) report, there was a 51 percent increase in the number of men seeking debt advice since 2007. Factors such as rising unemployment, a slower rate of salary increases and rising household expenditure combined took toll on men’s financial status.

The top ten insolvency regions (new personal insolvency cases per 10,000) according to the report by R3 are:  

1.    Torbay, South West (45.8)

2.    Kingston upon Hull, Yorkshire and the Humber (40.7)

3.    Lincoln, East Midlands (39)

4.    Plymouth, South West (38.8)

5.    North Tyneside, North East (37.4)

6.    Gateshead, North East (37.1)

7.    Corby, East Midlands (37)

8.    Hastings, South East (36.9)

9.    West Devon, South West (36.9)

10.    Thurrock, East Anglia (36.7)

An effective debt management can help you control your debt and improve your financial situation, but before settling for a specific debt solution, it is always advisable to seek professional debt advice to explore your options.

I hope you have found my blog useful and enjoy the rest of the week. Lets hope the rain goes away first!

Nigel

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Enjoy Christmas on a budget, to avoid a financial hangover in the New Year!

Monday, December 14th, 2009

The festive season is without doubt the biggest drain on finances during the year and can very easily spiral out of control, leaving many people with a mountain of debt in the New Year.

At ClearStart we are committed to helping people avoid serious debt problems and with Christmas fast approaching, here are a few handy hints and tips on how to enjoy Christmas on a budget, which hopefully should serve you well both this Christmas and many more to come!

  1. If you’re cooking for a crowd on Christmas day, write up a list of everything you need and ask everyone to help out.  That way you dramatically cut down on the expense of Christmas dinner and all the trimmings.
  2. When visiting a supermarket for that all important Christmas shop, make sure you prepare a shopping list beforehand and stick to it.  Don’t be tempted to purchase those unnecessary luxury items.
  3. Shop around for presents. Try shopping online. There are some great bargains to be had, very often you can compare prices on line and find some good savings – very often postage and packing is included in the price and you will save on petrol and parking.
  4. If you exchange gifts with work colleagues, why not suggest a ‘Secret Santa’ with a limit you can all afford?  You will all have some great fun unwrapping the presents and not have to spend more than you need to.
  5. When buying presents, have a budget and stick to it! Don’t get into debt by trying to buy something you cannot afford.
  6. Don’t be tempted to skip paying your bills in December to give yourself extra cash.  Remember you will only have to pay them in January and could also incur some nasty late payment charges.
  7. Consider joining a savings club for Christmas next year – you can spread the cost of Christmas over 12 months and ensure you and your family have a few less things to worry about at Christmas!

Please remember that if you do find yourself in financial difficulty in January, don’t ignore the problem and hope it will go away.  It’s vital that you seek the advice of an impartial debt solutions company such as ClearStart, to help get your finances back on track and avoid having to look into a more severe debt solution such as a Debt Management Plan or an IVA.

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Could current consultation finally see debt management plans regulated?

Thursday, December 3rd, 2009

There are a range of debt solutions available to help solve debt worries, each specifically designed for different levels of debt, the number of creditors and personal circumstances.  Our debt solutions table gives a handy overview of what options are available and I’d strongly recommended seeking impartial advice from a company like ClearStart, otherwise you could end up being financially worse off than you are now.

For IVAs, there is already a strict protocol for providers to adhere to, which ensures fair and consistent practice throughout the industry.  However, for Debt Management Plans (DMPs), which are the dominant force in the insolvency industry, there is currently no regulation whatsoever.

 A well-run DMP by a company such as ClearStart is definitely worth considering for anyone looking to get their finances back on track. Negotiations are done on your behalf with creditors to arrange a repayment plan at a rate you can afford and in many instances interest is either frozen or applied at a much reduced rate. Once the plan has been agreed, you simply make one easy monthly payment to your debt management company who then distribute it to your creditors until your debt has been cleared.

 In response to the growing debt problem and bad practice by some DMP providers, there is a consultation process currently underway which is being run by the Ministry of Justice, the outcome of which may well be increased regulation of Debt Management Plans – a move which would be welcomed by many in the industry and give much needed peace of mind to anyone entering into a DMP.

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Do you know what you are entitled to?

Wednesday, November 18th, 2009

Consumer debt is mounting and some individuals are suffering financial hardship. It is important that everyone checks their entitlements to make sure they are not missing out on vital benefits. There are probably two reasons that people do not claim these benefits – the first is that they simply don’t know what they are entitled to and the second is that they feel too embarrassed to admit they are in trouble and need state help.

To help people ensure that they are receiving all the relevant benefits, there is a handy website to check eligibility. Have a look at  www.entitledto.co.uk.  The site is free to use, no personal information is required and you could be pleasantly surprised to find out what income benefits you’re missing out on.

Please remember that if you are still struggling after exploring benefit entitlement,  don’t be afraid to ask for help. Seek help and debt advice as early as possible. Make sure you get advice which if free. We are here to offer you free and impartial advice on a full range of debt solutions available including IVA and DMPs, plus our free self-help pack, to help you manage your money more effectively and reduce your need for a debt solution altogether.

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The importance of seeking the correct debt advice!

Wednesday, November 4th, 2009

For anyone experiencing serious debt problems, a well managed IVA or Debt Management Plan (DMP) can both be effective ways of climbing out of the debt trap and back on the road to financial recovery.

It is vital however that you choose a company who offers impartial debt advice best suited to your individual situation. If you don’t, you could be offered a debt solution which is completely unsuitable for your needs and destined for failure, which sadly so often happens and has in fact been highlighted in a recent article in the Observer.

When entering into any debt solution, its success relies on keeping up with the agreed monthly payment.  Any reputable company will make sure that you have enough money to live on each month, whilst also ensuring that your creditors are receiving an acceptable return on their debt.  Once you have reached the end of your debt repayment plan, you are free to start afresh, rebuild your credit file and take control back of your finances.

Unfortunately as I previously mentioned, sometimes people fail with their plan leaving them with no option than to go bankrupt or look at alternative debt solutions. In many instances the money they have already paid into the failed plan has been taken up with fees, so they are still stuck with the original debt and deeper in financial ruin.  

The main reasons for failure is when the customer is given an unrealistic amount to live on each month, or they have been ill advised which solution to enter, so the importance of finding a reputable company with your best interests at heart, cannot be stressed highly enough.

For an ‘at a glance’ look at the type of debt solutions available and which one may be suitable for you, I’d recommend visiting www.clearstart.org/debt-solutions/product-suitability, although please remember no two problems are the same and we wouldn’t be able to make a confirmed recommendation until you had spoken to one of our advisors.

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