Debt management – to pay or not to pay…
Of course this is not going to be about whether or not you should pay your debts...but should you pay for debt advice or support?
My advice to you is this - why pay for a service when you can get it free?
As an Income Officer at Spirita, I am responsible for managing rent accounts, and part of my role involves contacting residents who are in rent arrears. Lately I’ve come across more and more residents who are paying independent companies to manage their debts for them i.e. you, the resident, will set up a payment plan directly to the debt management company and they will pay your creditors.
What a lot of people don’t know, however, is that the debt management company will charge an ongoing administration fee for the service. For example, one resident pays around £208 a month. Of this amount, £31 goes to the debt management company in administration fees.
I decided to do an internet search and found that the majority of companies offering debt counselling did provide free advice, but this was for the initial consultation only – continuing services were charged for.
The good news is that FREE advice and help is available through a variety of organisations, including the Citizens’ Advice Bureaux and local advice agencies. The National Debtline and Consumer Credit Counselling Service websites are also very useful, as they offer free advice and guidance on how to approach creditors, along with pre-written letters that you can personalise with your own information.
If you would like more information or the details of local advice agencies in your area, then please contact us on 0115 988 7100 and ask for the Income Team.
Kerry Parsons, Income Officer