Following an Appeal Court ruling on Horton vs Henry, published in October 2016, pensions are once again safe if you go bankrupt. The full judgment is here. The background to this case was: before 2000, pensions formed part of a bankrupt's estate and would be taken once the bankrupt reached pension age; the Welfare Reform and Pensions Act changed this. For people going bankrupt after … [Read more...]
Debt news and policy
Debt Camel articles on what's changing - and what ought to change - in the world of personal debt in Britain.
If you are interested in a specific area, look at: High cost credit news & policy and Insolvency news & policy.
I write a weekly round-up of debt and poverty news on Sundays. There are only kept for a month or two, see Weekly News Summaries.
IVA lead generators – the case for regulation
IVAs are now the most common form of personal insolvency in England. Clear Debt has recently stated: Individual Voluntary Arrangements) (IVAs) have become the procedure of choice for those people who have debts they can’t pay and a regular income to enable them to make contributions to their debts. But how often is the choice of an IVA based on accurate information about the alternatives and … [Read more...]
IVA early exit loans – Perinta/Creditfix and Sprout/Aperture
Early IVA exit loans from Perinta offered in 2016 to Creditfix customers Some people have been told they can end their IVA by taking an "early exit loan" from Perinta Finance Ltd, via a broker called Just Lending. Creditfix is sending these emails, but the loan may be available to people in IVAs with other firms. Pearse Flynn, the CEO of Creditfix, used to be a director of Perinta, but no longer … [Read more...]
Paying BadDebtor won’t help your credit record
A reader who had gone bankrupt recently was surprised to get a letter from "The Register of Bad Debtors". This offered to remove her name from their records if she pays them £49.95. She asked if BadDebtor can really do this? There are also reports that people with IVAs are receiving similar letters. In 2017 the Bad Debtor website was taken down. Before that, some people I had contacted - none … [Read more...]
Re-thinking Insolvency Practitioner Regulation
This is a guest post by Peter Sargent, an Insolvency Practitioner and Consultant at BHP Clough Corporate Solutions. He is a member of the IPA’s Membership & Authorisation Committee and former president of R3. The failure of Varden Nuttall (and its holding company), a middle ground IVA bulk provider has brought into sharp relief the current system of Insolvency Practitioner (IP) … [Read more...]
The 2016 IVA Protocol – what has changed?
In June the new 2016 IVA Protocol was published. It would have be helpful if the Standing Committee had issued a guide to the changes from the 2014 Protocol, but they haven't, so this article looks at the significant changes, ignoring routine updating (such as replacing OFT by FCA) and some which seem to me to be very minor. My thanks to Michelle Butler who wrote about the changes earlier this … [Read more...]
Interest only mortgages and debt advice
The Financial Conduct Authority (FCA), who regulates the mortgage lenders, issued an update in 2018 saying they are still concerned about the number of interest-only mortgages customers will not be able to repay at the end. It said: Since 2013 good progress has been made in reducing the number of people with interest-only mortgages. However, we are very concerned that a significant number of … [Read more...]
Varden Nuttall – what happened
Varden Nuttall, a mid-size Individual Voluntary Arrangement (IVA) firm, was placed into administration on 24 March 2016. The administrators discovered that £9million was missing from the client account and evidence of fraudulent practices by Philip Nuttall, one of the insolvency practitioners and a director of Varden Nuttall Limited, In October 2018, Philip Nuttall was found to be in … [Read more...]
gov.uk debt advice is dangerously simplistic
The gov.uk website has a new section on debt advice. It asks four simple-sounding questions: where in the UK do you live? do you owe more than £20,000? do you have assets (things you own) worth more than £1,000 in total? do you have at least £50 left over every month after paying your household bills and living expenses? Based on your answers, it then suggests which of a DMP, an … [Read more...]
Why the FCA should ban the Compass debt advice model
In March 2016, the clients of Compass Debt Counsellors found out their debt management firm had gone into administration. Many people had thousands of pounds being held by Compass and may not get this money back. In This Compass points to Debt Misery, Legal Beagles points out: "This form of daylight robbery is hugely rewarding because no one ever seems to go to prison for such crime. If I … [Read more...]