Discussion thread - DMPs and the continuing addition of interest.

[Peterbard]

Both SC and Payplan have the same model but I understand that many creditors pay back different (lower) rates to Payplan as a FSC.

 

I have been getting reports of Payplan pushing IVA's for as little as £50 per month on a £15-20k debts. I find it hard to see how this can be viable.

Anyone explain this to me

[sequenci]

I have been getting reports of Payplan pushing IVA's for as little as £50 per month on a £15-20k debts. I find it hard to see how this can be viable.

Anyone explain his to me

 

I've not come across them as low as that but certainly for around the £100 mark. I've also had clients who have been sold IVAs for debts of less than £15k - I had one for £7k - Don't think that particular one was Payplan, mind you.

[Nick Pearson]

I know that lots of IVA providers are doing very low value IVA's ie £100 or less. Its beyond me how they can afford to do it at that level of DI given the costs involved in IVA's. Similarly, the level of debts to be considered for an IVA has reduced - Ive seen some at £5k. Given the debt writeoff in an IVA, it seems that clients are getting a good deal with these low value/low DI cases.

[Peterbard]

Yes i have a had a couple now, together with added incentives regarding safeguarding of the clients home/ assets against charges in year four and five, some quite aggressive selling from what i hear.

 

I find it difficult to see what the advantage would be form the creditors point of view to terminate a working DMP for an IVA that would give them a smaller monthly repayment for less time, doesn't make any sense to me, I am obviously missing something.

[NEDCAB Lady]

Hello all

 

What a fascinating and informative discussion!

 

A

[sequenci]

I find it difficult to see what the advantage would be form the creditors point of view to terminate a working DMP for an IVA that would give them a smaller monthly repayment for less time, doesn't make any sense to me, I am obviously missing something.

 

They may object to the IVA if they don't like it - and many do. From what I understand Lloyds are being particular harsh at the moment. Nick would know now than me on this for sure.

[Peterbard]

They may object to the IVA if they don't like it - and many do. From what I understand Lloyds are being particular harsh at the moment. Nick would know now than me on this for sure.

 

Yes I understand that there is a rule that if the majority(75%?) agree then the others are compelled to accept, I cannot see why any would to be honest, although it can be a good deal for the debtor, if he wants to be tied to the arrangement.

[Peterbard]

I know that lots of IVA providers are doing very low value IVA's ie £100 or less. Its beyond me how they can afford to do it at that level of DI given the costs involved in IVA's. Similarly, the level of debts to be considered for an IVA has reduced - Ive seen some at £5k. Given the debt writeoff in an IVA, it seems that clients are getting a good deal with these low value/low DI cases.

 

Amazing deals - I referred someone to ND yesterday, it will be interesting to see how they end up.

[sequenci]

Yes I understand that there is a rule that if the majority(75%?) agree then the others are compelled to accept, I cannot see why any would to be honest, although it can be a good deal for the debtor, if he wants to be tied to the arrangement.

 

I believe the IP would point out what the creditors return might be should the individual use the alternative insolvency measures - for many people that could be bankruptcy.

 

It would break my heart if ANYONE was placed within an IVA where they could have had a DRO.

[Peterbard]

I believe the IP would point out what the creditors return might be should the individual use the alternative insolvency measures - for many people that could be bankruptcy.

 

It would break my heart if ANYONE was placed within an IVA where they could have had a DRO.

 

Good point

[Wintry]

I know that lots of IVA providers are doing very low value IVA's ie £100 or less. Its beyond me how they can afford to do it at that level of DI given the costs involved in IVA's. Similarly, the level of debts to be considered for an IVA has reduced - Ive seen some at £5k. Given the debt writeoff in an IVA, it seems that clients are getting a good deal with these low value/low DI cases.

 

Hi

 

This is an interesting development and has me puzzled slightly other than something had to change in the IVA industry.

 

The TDX group have been talking this up (if that is the right term) for a while now along with others I understand

 

Not much room after the fees, but with very low payments into the IVA then the likelyhood for default & long term failure is arguably much less and of course the interest and charges are frozen - when you look at these in a way they could be seen as getting closer to a formal DMP without actually being this in reality (not forgetting the fees of course:)

 

Creditors cant really get much of a return based on the simple maths by the look of it but they will decide and must know the score

 

It is an interesting subject area and all options and solutions should always be properly and independently advised, explained and choice given in the best interests of the debtor.

 

Do some of the online debt remedy systems allow for a low cost IVA in the calculations and if not, then why?

 

I might talk about DROs and applying the Common Financial Statement (CFS) expenditure figures later.

 

My opinions

Edited August 7, 2013 by Wintry

[Wintry]

That's a great point. I've know that NDL gets calls from people that couldn't be helped by SC and Payplan for whatever reason.

 

Hi

 

This does not surprise me and its the same with us.

 

It will get worse in my opinion.

 

A war of words is on the cards and possibly light the blue touch paper soon (maybe very soon)

 

Some have had enough and have no real choice

 

My views

Edited August 7, 2013 by Wintry

[sequenci]

Hi

 

This does not surprise me and its the same with us.

 

It will get worse in my opinion.

 

A war of words is on the cards and possibly light the blue touch paper soon (maybe very soon)

 

Some have had enough and have no real choice

 

My views

 

I agree.

 

What I would like to see is less money spent on glitzy marketing and basic info on financial products and services (The MAS, basically) and greater funding of a free-to-client scheme to assist with priority situations like housing arrears, basic court stuff, bailiffs and the like. A case in point: Birmingham Law Centre has recently closed down. An absolute travesty - especially in a City with so much poverty.

[Wintry]

I agree.

 

What I would like to see is less money spent on glitzy marketing and basic info on financial products and services (The MAS, basically) and greater funding of a free-to-client scheme to assist with priority situations like housing arrears, basic court stuff, bailiffs and the like. A case in point: Birmingham Law Centre has recently closed down. An absolute travesty - especially in a City with so much poverty.

 

Hi

 

I agree if I am honest

 

I have been to a couple of advice centres in Birmingham along with quite a few training venues but I don't think the Law Centre was one of them.

 

Many of the Law Centres across the country have been hit with the cut in legal aid funding along with many CAB branches and others.

 

My view and through experience is that it has gone too far with some agencies where it can be basically geared to advice and solutions that generate the most funding for them.

 

The rest of the people that contact them (which according to some of their own statistics the way I read them is the vast majority) are basically left to deal with things themselves including priority debts, which as we both know are the most important.

 

So the claims of being charities to help people with debts can ring a little hollow with me and others who see the whole picture of an overall worsening situation.

 

The most worrying aspect of some of the things we are seeing is that in my opinion genuine recognised advice is clearly being undermined by some of the things that are going on which in turn is putting even more strain on other advice agencies.

 

It has been overkilled in my opinion and now many people already have and are seeing through it.

 

I have noticed a change in approach advice wise on the forums but it is not genuine in my opinion and could expose things even further when the scrutiny bites.

 

The economic downturn, the sharp rise in the cost of living, welfare reform is rapidly catching up

 

Trapped in a business plan with nowhere to go and the challenge gathering pace by the day.

 

The irony is that the more they try to detract the more they prove the case for the prosecution - hence the deafening silence perhaps

 

I have today seen the latest delivery that is on its way from the CAB people, it looks good, the message it could carry may also cause a pretty substantial after shock.

 

There is a real genuine challenge developing here with much more to come by the look of things

 

Like I say, no choice now really, it will run its course come what may

 

If standards rise and people get the help they deserve then at least something will be achieved

 

My opinions

Edited August 7, 2013 by Wintry

[Peterbard]

I'm clearly far too simplistic being a very small, oversubscribed charity. I set the charity up for a clear reason, to help people with their problems and find a good solution for them. We're not plagued by funding issues, being dictated to from outside influences (or very minimally) etc.... The true independence really gives us quite an edge in a way I'd not fully appreciated until this discussion.

 

I have no time at all for agendas, pushing a particular product, maximising profit or anything like that. It simply is not what we are there to do.

 

Reading this makes me glad I've fought quite hard at times to maintain total independence from external influences.

[Wintry]

I'm clearly far too simplistic being a very small, oversubscribed charity. I set the charity up for a clear reason, to help people with their problems and find a good solution for them. We're not plagued by funding issues, being dictated to from outside influences (or very minimally) etc.... The true independence really gives us quite an edge in a way I'd not fully appreciated until this discussion.

 

I have no time at all for agendas, pushing a particular product, maximising profit or anything like that. It simply is not what we are there to do.

 

Reading this makes me glad I've fought quite hard at times to maintain total independence from external influences.

 

Hi

 

I think you have more or less summed things up well here.

 

Not sure what too say after reading this.

 

Think I will now sleep on it all

 

Catch you later all being well