Mr X has received a reply from QuickQuid saying why it will not consider an affordability refund on payday loans that are more than six years old. This part of QuickQuid's reply isn't related to the details of Mr X's case. It looks like a standard response QuickQuid is sending everyone whose complaints include these older loans. I often see pretty poor replies from payday lenders to people … [Read more...]
Dear Payday Lender CEO – should you start a redress program?
On October 15, the FCA sent a Dear CEO letter entitled Affordability of High Cost Short Term (HCST) loans to payday lenders. This letter tells the lenders to review their affordability assessments. There are some very clear points about what the FCA expects a payday lender to do if it is not making good affordability assessments now or hasn't done in the past. "Chains of loans" over an … [Read more...]
Debt News – October 14
Lots of Universal credit and benefit related articles this week as campaigners hope to force improvements in the autumn budget. My two top picks: Universal credit: who gains, who loses, and how does transitional protection really work? and Universal Credit and patterns of earning. Tweet of the week The Chancellor has one last chance to end the benefit freeze in his Autumn Budget, says … [Read more...]
Support for Mortgage Interest (SMI) is now a loan – should you agree to this?
Support for Mortgage Interest (SMI) helps people with the cost of their mortgage if they aren't working. It has been paid as a benefit since 1948, but in April 2018 this changed and now it is only given as a loan that is secured on your house. Here is the DWP leaflet describing the new loan: DWP SMI Factsheet (6 April). You may see LMI (loans for Morgage Interest) used as the new name for this, … [Read more...]
£140 help with your electricity bill in winter 2018-19
Are you worrying about how to afford the heating this year after the price rises in 2018? The good news is millions may be able to get £140 off their electricity bill through the Warm Home Discount scheme if they are on a low income. Five points for applying for a Warm Home Discount The key points for making a Warm Home Discount application in 2018 are: Pensioners do not need to apply, … [Read more...]
FCA warns “Debt Packagers” about poor debt advice to enter IVAs
On 5 October, the FCA wrote a Dear CEO letter saying: We have undertaken a review of a small sample of debt advice provided by Debt Packager firms and are very concerned about the poor standards we have seen... The FCA then asks the CEO to review: your quality of debt advice; the firm’s identification and treatment of vulnerable customers; financial promotions, and systems and … [Read more...]
Debt news – October 7
A hard week to try to pick one or two articles from. For a couple of articles with potentially big long-term impacts that you may not have seen, read Ombudsman decisions on payday loans over 6 years old and the FCA's Dear CEO on IVA lead generators. Both the CAP Debt Saviours documentary and Citizens Advice to provide Universal Credit support have provoked a lot of discussion. Tweet of … [Read more...]
Ombudsman decisions on payday loans over 6 years old
The Financial Ombudsman (FOS) has published two Decisions involving payday loans over six years old: Mr H has complained about fifty-four payday loans Lender C lent to him between March 2010 and September 2014. Mrs W’s complaint is about nine short-term (often referred to as ‘payday’) from Lender D between November 2009 and July 2012. In each case, FOS has decided that its rules allow … [Read more...]
It’s wrong for Vanquis to profit from delaying ROP refunds
In February the FCA ordered Vanquis to refund £168m to customers using its ROP product, because Vanquis had not explained the additional interest people were being charged. At that point, Vanquis said it would refund customers with open Vanquis accounts within three months. In June, Vanquis gave up on that three-month target and said it hoped to refund people with open accounts by the end of … [Read more...]
IP regulation – Insolvency Service find major problems
The Review of the monitoring and regulation of insolvency practitioners that was published by the Insolvency Service last week found evidence of many of the problems in Individual Voluntary Agreements (IVAs) that I and other free-sector debt advisers have been talking about for several years. Although it is often not specific about what has to be done, the report is clear that change has to … [Read more...]
Debt news – September 30
My pick of last week's news is the Insolvency Service's report on Review of the monitoring and regulation of insolvency practitioners. Essential reading for debt advisers. Tweet of the week What! The @Barclays boss today claims PPI reclaiming's fueled a fraud culture! #potkettle Bank's PPI selling was a systemic, deliberate, scripted, protection racket to missell £30bn+ of insurance. An … [Read more...]
Debt free – what do you do now?
All your unsecured debt gone? Good news! Some online forums call this “your happy dance” and you are certainly entitled to have a twirl around and pop into your local coffee shop for that coffee and cake you have been avoiding for so long. Still no spare money though? For some people, getting rid of your debt doesn't dramatically change your life or your options. If you have had a Debt … [Read more...]
Lessons to be learned from Wonga – 6 policy challenges
It's now a few weeks since Wonga went into administration. This seems like a good point to ask some difficult questions about the lessons from Wonga and what should be done to reduce consumer harm in future. Much of the media coverage has gone as follows: Wonga was the worst - then the FCA fined them and made them write off debts in 2014 and introduced good payday loan regulation in 2015. … [Read more...]
Debt news – September 23
My pick of last week's news is Social Metrics Commission announces a new measure of poverty. Tweet of the week Our new campaign to end the extra costs of being poor launches today! Be part of our movement to end the unfairness of how #PoorCostsmore #PovertyPremium We've created a Roadmap to pave the way, please share far and wide to end this injustice. https://t.co/WAChPEdWpf … [Read more...]
Claiming PPI after a very old failed IVA
Here is a PPI after IVA issue to disentangle: Mr S wrote: I had an IVA which failed after two years more than 10 years ago. After it failed I had a CCJ and a debt collector contacted me. I cleared both of those debts and then worked on repairing my credit score. I’ve now had a successful PPI claim against bank X but they won’t release the cheque to me as I was in an IVA. I have found out … [Read more...]
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