Debt Management Case Studies
In what follows, you will see several examples of actual cases of ours, to give you an idea of the people we have helped and continue to help. All names have been changed.
Debt Management prefered to an IVA as income expected to rise.
| Debt: £28,000 | Was paying: £850/month |
| Now paying: £400/month | |
| Tim Brown has an income of £1480 per month, and was able to manage repayments on debts of £28,000 while living with his partner and child. The relationship broke down, and Tim was still able to afford repayments until CSA demanded over a 3rd of his income. Now unable to keep up with the repayments, debt management is his only option. An IVA is not possible as he has only 2 creditors. Tim is not a homeowner, so he is unable to get an unsecured consolidation loan for such a large amount. | |
Remortgage not an option for Pensioner with debt exceeding over £40K
| Debt: £42,000 | Was paying: £910/month |
| Now paying: £180/month | |
| James Johnson has debts of £42,000 with eight creditors. He is 66 years old, with £1,270 per month joint income from his and his wife's pension combined. He was paying £819 per month. He owns his home, without a mortgage; it is valued at over £400,000. Mr. Johnson was refused a secured loan due to insufficient disposable income. We have reduced his payment down to £420, with a view to getting a secured loan or downsizing his home in the future. | |
Debt management the only solution for unemployment period
| Debt: £12,950 | Was paying: £350/month |
| Now paying: £180/month | |
Deborah Dzurila had affordable credit repayments until her husband lost his job, which effectively halved the household income. Two months later, their savings was running low, so they decided to look for a consolidation loan to reduce monthly payments. They were refused for all the loans because their income was too low and they were not homeowners. They were about to start missing payments and needed a fast solution. Mrs. Dzurila was looking into IVAs, but her husband would be returning to work soon and an IVA would be too permanent, as their circumstances would be changing. Debt Management seemed to be the right solution for them because the payments were flexible and could be increased only when they were both working again. |
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IVA not an option due to unstable employment history
| Debt: £21,325 | Was paying: £450/month |
| Now paying: £300/month | |
| Randy Abrams lost his job and was out of work for several months. He began to live on credit and the balance grew to £21,325. Randy started a new job last month, but must serve a 3-month probation period. Randy has a value of debt that makes him eligible for an IVA. However, the fact that he has just started a new job and recently had a period without work means this option is not available to him. Creditors need to be confident that payments into the IVA will be made at the agreed rate each and every month for 5 years. A Debt Management program is a lot more flexible in this regard, and suits Randy’s current situation. |
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Debts of £83,000 but not able to write off any with an IVA
| Debt: £83,350 | Was paying: £2300/month |
| Now paying: £980/month | |
| Laura Wood takes home £3,750 a month and jointly owns a property with her husband. These factors have enabled her to build up £88,350 of unsecured debts. Due to the high debt, Mrs. Wood contacted Betterway about an IVA. Upon speaking to one of our advisors, she learned that working within the guidelines of an IVA would enable her to pay back the full amount to her creditors. (60months x disposable income + £20,000 remortgage = the original debt). Mrs. Wood was not aware of Debt Management, and upon finding out more, decided this was the best option for her circumstances. | |
Separation leaves client to repay debts by himself
| Debt: £14,293 | Was paying: £641/month |
| Now paying: £300/month | |
| Ryan Duke took credit while he was with his partner, and with the two wages combined, they were able to maintain their repayments. The couple has now separated, and because the debts were taken out in his name, Ryan has to make the repayments alone to twelve different creditors. Living alone, his living costs have also risen. To help make ends meet, Ryan started a second weekend job, but is still struggling to get by. Ryan wants to repay his debts, but as things are, he cannot see an end in sight. On Debt Management, his monthly payments are affordable, and his debts are reducing each month. | |
CCJ means a Debt Consolidation Loan is not possible
| Debt: £2,370 | Was paying: £445/month |
| Now paying: £158/month | |
| Linda Evans had a dispute with her mobile phone supplier about her bill. She refused to pay it, and was referred to a debt recovery agency. Linda still refused to pay it, and it escalated to a CCJ. She does not have a high level of debt, but due to the CCJ, she cannot consolidate her debts with a loan. Linda is currently 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 | |
| Bob Wallace’s difficulties began when he became ill. After three months, Mr. Wallace’s wages were reduced to statutory sick pay. The strain of illness and financial difficulty resulted in Mr. Wallace and his partner separating, thus increasing his living costs. Mr. Wallace continued to live on credit and fell further into debt. Now he has recovered from illness and is returning to work. Mr. Wallace’s lengthy absence from work means that an IVA is currently impossible. This is because creditors need to be confident that an IVA can be made every month for five years. Mr. Wallace is now to continue with his current repayments and will consider the possibility of an IVA in the next 6 to 12 months. |
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Self employed contractor gets nothing when owed £8,000
| Debt: £6,700 | Was paying: £458/month |
| Now paying: £200/month | |
| Roger Jeppesen is self-employed and contracts work from another business; this business, however, has just gone bust still owing him £8,000. The official receiver has advised Roger that he will not receive any money. This has caused him extreme financial difficulties. Nine months ago, Roger had no debts – now he's paying back two loans and making minimum payments on several cards. Debt Management has allowed him to start clearing this debt at an affordable rate without having to borrow again. | |
£58,000 of debt - but can't do an IVA
| Debt: £58,000 | Was paying: £1267/month |
| Now paying: £300/month | |
| Keith Rogers has £200,000 of equity in his home, but unsecured debts of £58,000. His assets are greater than his debts, therefore he is not technically insolvent, however he is unable to afford to pay his 11 unsecured creditors from his average monthly income of £1,060. An IVA is not possible, as Keith’s creditors would never agree to forgive any debt when he could repay them in full by selling his property and buying somewhere cheaper. Keith does not want to remortgage at this time, as has recently become self-employed and does not want to risk his home if that does not work out as he’s hoping. Debt management will never pay off this debt, but it gives Keith some respite from his creditors while he focuses on building his business without dealing with the fear of losing his property. | |
Increased mortgage payments make unsecured debts unaffordable
| Debt: £5,667 | Was paying: £225/month |
| Now paying: £140/month | |
| Mario Taylor 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 or take out a secured loan, for this would increase the risk of repossession in the event that Mario cannot maintain those payments. | |
Missed payments means debt keeps increasing
| Debt: £8,250 | Was paying: £275/month |
| Now paying: £120/month | |
| Bruce Davis’s debts were not that large, but frequently missed payments meant his debts were not getting any smaller. Debt Management allowed Mr. Davis to make the same reduced payments, but as we had agreed upon this in advance, he was not penalized for it. Mr. Davis can now see his debt reduce, month by month. | |
Debt Management preferred to an IVA as income expected to rise
| Debt: £27,650 | Was paying: £701/month |
| Now paying: £250/month | |
| Celeste Witherspoon recently returned to full-time education, where her personal debts rose to over £25,000. Now back in full-time work, Ms. Witherspoon is unable to find the £701 per month demanded by her creditors. We advised her to consider an IVA as well as debt management, because her circumstances made her a potential candidate. However, as Ms. Witherspoon expected her income to rise over the next 2 years, she opted for debt management, as its informal flexibility suited her short-term needs. | |
“Loans are subject to status and available to UK residents aged 18 and over”
“Think carefully before securing other debts against your home.
Your home may be repossessed if you do not keep up repayments on a mortgage or any other debt secured on it"
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