Debt Management Case Studies

These example are based on actual cases, typical of the many people we have helped. In each case, some details and values have been changed to protect client privacy.

£58,000 of debt - but can't do an IVA.

Debt: £58,000	Was paying: £1267/month
	Now paying: £300/month
Client has £200,000 equity in his home & unsecured debts of £58,000. His assets are more than his debts, but he can't pay 11 creditors from a monthly income of £1,060. An IVA is not possible as his creditors would never agreed to forgive any debt when he could repay them in full by selling his property. The client does not want to remortage as he has recently become self employed and does not want to risk his home if that does not go to plan. Debt management will never pay off this debt, but it gives our client some respite from his creditors while he focuses on building his business without the fear or court action or losing his home.

CCJ means a Debt Consolidation Loan not possible.

Debt: £2,370	Was paying: £445/month
	Now paying: £158/month
Client X had a dispute with her mobile phone supplier about her bill. She refused to pay it and it was referred to a debt recovery agency. She still refused to pay it escalated to CCJ. The client does not have a high level of debt but due to the CCJ she cannot consolidate her debts with a loan. She is paying £39.50 per week, which is the maximum see can afford.

Illness leads to reduced income and financial difficulties.

Debt: £36,500	Was paying: £703/month
	Now paying: £200/month
Client's difficulties began when he became ill. After 3 months his wages were reduced to statutory sick pay. The strain of the illness and financial difficulty resulted in the Client X and his partner separating, thus increasing his living costs. The Client continued to live on credit and fell further into debt. Now he has recovered from illness and is returning to work. His lengthy absence from work means an IVA is currently not possible. This is because creditors need to be confident IVAs payments can be made every month for 5 years. He is to continue with current repayments and will consider the possibility of an IVA in the next 6-12 months.

Self employed contractor gets nothing when owed £8,000.

Debt: £6,700	Was paying: £458/month
	Now paying: £200/month
Client X is a self employed and contracts work from another business, however, this business has gone bust owing him £8,000. The official receiver has advised Client X that he will not receive any money and this has caused him financial difficulty. 9 months ago he had no debts, now he's paying back 2 loans and making minimum payments on several cards. Debt Management allows him to start clearing this debt at an affordable wait without having to borrow again.

Income drop due to maternity leave makes credit repayments a struggle.

Debt: £11,000	Was paying: £502/month
	Now paying: £285/month
This a case of a joint debt management application. Mr and Mrs X are expecting their first baby. Mrs X is taking maternity leave. With the income drop and costs of having a baby, they know they will be struggling, even though they are not currently in arrears with any of their 8 creditors. They realise their circumstances will keep changing over the next few years and want a plan that will work with them to clear their debts.

Increased mortgage payments make unsecured debts unaffordable.

Debt: £5,667	Was paying: £225/month
	Now paying: £140/month
Client had completed the fixed rate introduction period to his mortgage and has been hit by larger than expected interest rates. He has equity in the property, but opted for debt management as he does not want to remortgage nor take out a secured loan as this would increase the risk of repossession if he could not maintain those payments.

Missed payments means debt keeps increasing.

Debt: £8,250	Was paying: £275/month
	Now paying: £120/month
Client's debts were not that large but frequently missed payments meant his debts were not getting any smaller. Debt Management allowed him too make the same reduced payments, but as we had agreed this in advance, he was not penalised for it. He can now see his debt reduce, month by month.

Debt Management prefered to an IVA as income expected to rise.

Debt: £27,650	Was paying: £701/month
	Now paying: £250/month
Client returned to full time education where her personal debts rose to over £25,000. Now back in full time work, she is unable to find the £701 per month demanded by her creditors. We advised here to consider an IVA as well as debt management as her circumstances made her a potential candidate. However, as she expected her income to rise over the next 2 years, she opted for debt management as its informal flexibility suited her short term needs.

Can We Help? Want To Know More?

If you would like us to call you back with some specific advice or more details about our debt solutions then please enter your details below.

your name	your email address (optional)
your phone number	2nd phone number (optional)
Best time to phone
Please enter your question or some information about your current situation. (optional)

Privacy Statement: We consider protecting your privacy to be a serious issue. By submitting your details you are accepting our Privacy Policy. All Correspondence is in the strictest confidence.