Chronic capacity shortfall in debt advice sector

Difficulty in obtaining debt advice could see more Brits losing their homes and falling further into serious debt warns ClearStart.

Chris Moat, ClearStart comments:
“When you have a debt problem it is important to deal with it quickly and not to bury your head in the sand. It could be the difference between keeping a roof over your head and losing your home.”

Finding the right advice isn't easy in the current economic environment, more and more people find themselves in financial difficultly and there isn't enough free advice to go round. There is also the added danger that when you do find an advice outlet, you have to be very careful about the quality of advice which can be variable and the wrong advice can lead customers into expensive mistakes.

Recent industry statistics from prominent members of the free sector, such as Money Advice Trust state that only half of the 4 million enquiries that they receive can be handled. This could leave 2 million Brits with an uncertain future, if they don't act quickly and receive good advice based on their individual circumstances.

Chris added:
“The lack of capacity in the market can lead customers into obtaining sub standard advice. For example, there is an increasing trend for consumers to be recommended bankruptcy which can sound like a quick fix but leads to financial exclusion and should in fact be a last resort.”

A debt advice process should ensure affordable monthly contributions which best resolves financial difficulties without introducing financial hardship. The solutions can range from advice on restructuring finances such as remortgaging and paying off your credit cards, through to full blown bankruptcy.

Chris concluded:
“We have relaunched ClearStart as a direct response to the massive under supply of free sector debt advice. We now bring to consumers a new alternative to existing free suppliers by offering access to our independently accredited debt advice process and we have changed our products so that they now offer at least as good value as those available from the free sector. In the case of debt management plans, for consumers who successfully stick to their plans, we offer them an added bonus by making the last two repayments on their behalf. This product offering means that consumers can now obtain greater access to quality debt advice without having to compromise on price.”

With unemployment looking to peak at 3.25 million by the beginning of next year, and the Citizens Advice Bureau currently dealing with 7,241 new debt problems every day, it is expected that demand for ClearStart's services will increase substantially during the coming months.

Chronic capacity shortfall in debt advice sector

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