Debt Archive

Two Different Debt Management Plans To Help Clear Debts

At Bournes we understand the impact of unmanageable debt on an individual’s life can be overwhelming. By the time our clients contact us for debt advice, nearly 70% had been in a debt management plan or IVA with other debt advice agencies such as, PayPlan, CCCS, Blair Endersby, or Eurodebt. Most of these clients had contacted us because the aforementioned debt advice agencies had caused them to get into further debt by failing to stop interest and charges, or putting them on an IVA or payment plan that was unrealistic.

The consequences of failing to create a debt programme that is realistic and manageable can be severe. Several clients have informed us that they are in substantial mortgage arrears because they were threatened with bankruptcy if they did not maintain payments on their IVA, even though they had informed the company dealing with their IVA that they were struggling.

Almost all our clients who had held a debt management plan with PayPlan and CCCS complain that interest and charges were not frozen and their debts have continued to increase. Many have county court judgment against them for debts which may have been unenforceable but were never contested because both PayPlan and CCCS are funded by creditors, therefore, they are not working in the best interest of the debtor.

The impact on poor debt advice can be devastating. Relationship breakdown, feelings of isolation, the stress of living on a tight budget had affected them deeply.

Debt management can help clear your debts, providing you are with a specialist advice agency, such as Bournes, who will work on your behalf to freeze interest and charges before making payments to your creditors, check your credit agreements to see if your loans or credit cards can be written off, negotiate full and final settlement/part 36 offers on your behalf.

Because we are specialists, we can also:

  • defend charging orders or get terms attached to the charging order to prevent repossession
  • apply for time orders to freeze interest on loan agreements and prevent repossession where court action has commenced
  • defend county court judgments where debts may be statute barred, unenforceable or in dispute
  • recover bank charges to ensure that you don’t pay back what is not legally due

write off debts where creditors have failed to comply with the prescribed terms of the Consumer Credit Act.

We are also able to offer two different forms of debt management plans that suit your needs:

Debt Plan 1

We charge one fixed sum based on your level of debt. Your monthly payments are then put into a client account which, initially, pays our fees but will eventually be used to settle your debts in full & final settlements or part 36 offers.

All your credit agreements will be checked to see if we can get them written off. Where we find the credit agreements are unenforceable, the case will be referred to our solicitors for a full write off.

Bear in mind that the principal amount and interest have to be paid on a separate basis otherwise the International Debt Collection would take it as a breach in their plans because the fixed sum that is paid is based on the debt amount you have taken and paying monthly installments is entirely in your hand so that the interest rate does not pile up.

Where the credit agreements are enforceable, we will negotiate with the creditors for interest and charges to be frozen before making payment.

Debt Plan 2

We charge a monthly fee of 16% of your payment to us.

As in Debt Plan 1, your credit agreements will be checked to see if we can get them written off and will negotiate with your creditors to get the interest and charges frozen.

However, this service does not offer full & final settlements and you may find that it will take you substantially longer to clear your debts.

This is the most common debt management plan offered by other debt management companies. The only difference with our debt management plan is that we may be able to write off your debts.

If you are currently in a debt management plan, it is unlikely you are receiving the full professional service you are paying for. Unlike Bournes, most debt management companies do not have the specialist training required to deal with complex debt matters.