The CAB are funded from a number of sources, including central and local government, and their credibility is certainly not open to question as far as I am concerned. I also agree that they do a very valuable job.
The impression that I got from the creditor, though, was they that were mightily fed up of receiving letters from people with a postal order or cheque for a £1 enclosed.
If they received a proper financial statement, with proper authority then no problem. Anything else wasn't acceptable to them, so it seems to me that the opinion was that more and more people are just sending them a £1, regardless of whether that was reasonable, unfairly low or even too high as nothing at all could be afforded. A "one size fits all" approach if you like. Looking at it from that perspective then that stance makes more sense.
Whether you agree with their viewpoint or not, the fact remains that that is the way they view it.
Regards.
Cert DR
23+ years in debt advice
I do not post for anyone other than myself
Hi
I agree with Mike, it does seem a common line from some CABs for clients to be advised to pay just £1 per creditor. I am sure that creditors feel that the admin involved in processing such payments is counter productive. Infact I spoke to a client this week who was advised the above as an interim measure until they had received an appointment with a money advisor even though they had nearly 900 pounds disposable income.
Let's be clear CAB do a wonderful job, with a great passion [NEDCAB for one] but clearly can't always cope with the amount of enquiries that they receive.
Why not offer the client help from bona fida commercial companies ?
Regards
Is this true? Surely any debt management company has to provide information about their client's circumstances including the CAB. I am aware that there is a vast difference in the requirement to produce confirmation of verifying a client's circumstances under IVA proceedings, as opposed to general DMP work (this will hopefully change with regulation) but the very basic information should be presented.
I have a good friend who is a debt counsellor with the CAB who assures me that proper investigations are made before offers are made to creditors. And I think that the CAB do make direct referrals to insolvency practitioners - one of the larger providers seems to enjoy a very good referral relationship across the UK.
I can only assume that it is true, given this creditors stance on things. They were happy to accept any and all properly authorised 3rd party financial statements, and also very reasonable in their policy of freezing all penalty charges upon receipt of same, so you can only assume that financial statements are not being sent. Whether this is because the CAB do not have the resources and or time to do so for all their enquiries, or whether people are being advised to fill their own out with downloaded or sample template letters is something I can't answer I'm afraid.
Regards.
Cert DR
23+ years in debt advice
I do not post for anyone other than myself
There is no doubt that the CAB do an excellent job particularly with those clients who basically have nothing to offer. I know a number of people who work for the CAB and a lot of their clients have lost jobs, are disabled and in receipt of means tested state benefits. In these cases sending a £1 to creditors is one of the only options a debtor would have until their circumstances improve. I also know the CAB assist many clients in peitioning for bankruptcy but this is not always suitable particularly for those people with equity.
Commercial debt management companies have a minimum monthly payment that they will accept whereas the CAB do not. There may be an issue with proof and some clients send £1 to creditors without an income and expenditure or proof of their finances but this problem can be easily resolved.
The report highlighted is a long & interesting one with a lot to take in.
In light of some of the comments that have been made (which are fair) pages 32,33 & 34 of the report may be of particular interest to those who are following this thread.
Much is being made of the commercial advantages and disadvantages of the commercial/charity sectors, and also creditor attitude - but we must no lose sight of the fact that whilst we may feel that it is inappropriate for someone to be paying £1 per week potentially for the rest of their lives - they actually may be very comfortable with this arrangement in mind of the fact that their creditors are not chasing them and they feel in control of their debts.
I share some of the concerns about the commercial DMP sector, and also have concerns of my own with regard to ongoing practices within my own profession - and will definately welcome a more regulated approach as I have seen for real the impact that the IVA protocal has had on advice provided to the debtor and the monies which are now being returned to creditors - which is something that some of us have always strived to do in a balanced and fair manner.
Last edited by MelanieGiles on Wed Feb 03, 2010 9:46 pm, edited 1 time in total.
