UPDATE A few people have not been paid by the end of June. And everyone will receive a second, much smaller payment in December 2021. See Money Shop Scheme to pay 2nd small refund for details. A "Scheme of Arrangement" is in place for borrowers from the Money Shop, Payday UK or Payday Express who were given unaffordable loans. Background to the Scheme Failure to assess affordability … [Read more...]
The debt “Breathing Space” – could it help you?
The Debt Respite Scheme - better known as "the Breathing Space" - went live on 4 May 2021. A Breathing Space is a 60 day period while you get debt advice and find a suitable debt solution. During this 60 days, you get legal protection from your creditors for most debts and it stops interest and charges being added. Sounds good? For a few people this will be a real help, but often … [Read more...]
How to choose an IVA firm
Which are the best IVA firms to talk to if you are interested in an Individual Voluntary Arrangement (IVA) and whether it is a good debt solution for you? If you put IVA into Google, how do you decide which of the tempting see how much of your debt you can write off links to click on? Or you could choose the person that cold calls/texts you telling you about a little-known government … [Read more...]
What happens at the end of a DRO?
A Debt Relief Order (DRO) lasts a year. This is sometimes called "the moratorium period". At the end of this year, all the debts that were included in your DRO are wiped out. You aren't contacted at the end of the DRO year There is no "DRO Completion" check made at the end of this year. Not by the Insolvency Service and not by the debt adviser who set up your DRO. You won't be asked to … [Read more...]
Pregnant and can’t afford your IVA?
Abby is pregnant and worried she won't be able to afford the monthly IVA payments: My IVA was set up at the start of 2020. There are four debts in it, totalling £13,000. All the debts date from a previous relationship, my new partner doesn't have a debt problem. My IVA payments are £90 a month. I've managed so far, but I now need to buy things for the baby - cot, buggy etc. We are renting and … [Read more...]
StepChange redundancies & the funding of debt advice
On 22 April 2021, StepChange announced that it was proposing to cut its staff by 10%. It has started the process of consultations about 140-17o redundancies. To many people this will sound bizarre. In October 2020, the Financial Conduct Authority (FCA) found that 20 million people have seen their financial situation worsen because of Covid-19 and 7.7million people saw it worsen a lot. The FCA … [Read more...]
How does a payment arrangement work & is one right for you?
A typical payment arrangement is an agreement to repay a credit card, catalogue or loan in affordable monthly amounts. This is also called an arrangement to pay. You can ask a lender for an arrangement to pay, or a debt collector. The key points are: an arrangement is needed if you can't afford the normal debt repayments; do not offer more than you can afford; ask the lender or … [Read more...]
“Improving my credit score – be added to my partner’s card?”
A reader asked: I have fairly recently got an Aqua card with a limit of £1,900. Credit Karma suggests this is low and a higher limit (with low utilisation) reflects well with lenders. I’ve only just had a credit limit with Aqua so can't get another one soon. But I could be added as a secondary cardholder on my partner’s credit card. This is her idea – she has a limit of almost £10k. She never … [Read more...]
Provident’s Scheme to cap refunds – the background
UPDATE On 4 August 2021 the Scheme was approved in court. See Provident Scheme – 4 million people can now claim a refund to find out how it will work and how to make a claim. This article gives the background to the Scheme and what happened before voting started. In March 2021 Provident Financial Group (PFG) proposed a Scheme of Arrangement to reduce the refunds it has to pay to … [Read more...]
Bankruptcy timeline – what happens & when?
This bankruptcy timeline shows WHAT is likely to happen and WHEN if you go bankrupt in England, Wales or Northern Ireland. Some of the times are fixed - the bankruptcy marker is definitely going to drop off your credit file after six years. Others are less definite, but the indications in the timeline here should be right for a large majority of the people who go bankrupt. Take the decision … [Read more...]
No set off in a Scheme/Administration when debt had been sold?
In the Instant Cash Loans (ICL) Scheme Arrangement, Money Shop, Payday UK and Payday Express customers whose debts were sold to PRAC Financial (PRAC) have not been given set-off between their ICL redress and the loan they still owe. The same situation could occur with other Schemes of Arrangement and other debt collectors. It could also arise in administrations, for example Sunny loans that … [Read more...]
95% mortgages return in 2021 – but is one right for you?
95% mortgages vanished with the pandemic At the beginning of 2020, this article started by saying "95% mortgages are back in fashion". It pointed out many more 95% mortgage offers there were compared to a few years ago. The interest rates were a bit higher than a mortgage with a 10%5 or greater deposit. But with the pandemic, mortgage lenders ran scared, concerned that house prices may fall … [Read more...]
Barclaycard – more big cuts to credit limits in 2021
In April 2021, Barclaycard is cutting a lot of customers' credit limits. Some of the reductions are dramatic. Here is what one Debt Camel reader said: Today I received a letter from Barclaycard informing me my credit limit is being reduced from £5,000 to £250 in 1 months time. My balance is zero and has been for several months. Not very happy about this as it’s there for emergencies etc and … [Read more...]
Covid-19 – what help with debts & bills can you still get?
With the third lockdown ending in phases, this article looks at what support you can get with essential bills and debts. There are contact details at the bottom of this page for where it is suggested you should get help. More than four million payment breaks have been provided by lenders, but these lifelines are ending. If you have had six months of breaks already for a debt you won't be … [Read more...]
“Lower interest if your credit score improves” – a good idea?
Many people are frustrated by only being to access expensive credit. Their financial problems may be years in the past, but they still cannot borrow at a reasonable rate. The FCA's Woolard Review said in January 2021: Products or business models which aim to help consumers bridge from sub-prime to near-prime or mainstream have an important role to play in expanding access to credit, and … [Read more...]
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