ok...here goes....I'd would REALLY appreciate comments from all of you experts on this forum. If you feel that any of the details stated by CCCS in the following quoted extract from their response to my complaint, are incorrect or mis-guided, I plead with you to let me know...
QUOTE....
During your discussions with our Debt Counsellor, information about your income and expenditure was reviewed and details of your assets were supplied.
At this time, you told us that you had a jointly owned property valued at £190,000 which was mortgaged by you and your partner for £116,000. This meant there was joint equity of approximately £74,000.
Although you could not afford to pay your creditors in full, the budget you completed showed you could pay £420 per month toward your debts. Our Counsellor therefore explained how to make reduced repayment offers to your creditors and send monthly payments direct to them. Having considered this, you decided that you would prefer to take up a Debt Management Plan (DMP) through CCCS (**SEE NOTE 1 BELOW**). This involved us making repayment offers on your behalf and dividing your monthly deposit (consisting of your surplus income) among your creditors. The notes on your file show that you were made aware of the estimated duration of the repayment plan. (**SEE NOTE 2 BELOW**)
The duration of your DMP was based upon your total debt of £54,248, divided by your initial monthly deposit of £420. This indicated that it would take slightly over 10 years for you to repay your creditors. Your creditors' willingness to stop applying interest and/or charges also impacts upon the time it will take for you to repay the money you owe. Notes on your file indicate you told us that your circumstances were likely to improve so that a higher monthly repayment would become available in the future. This would mean your debts could be repaid over a shorter period of time. (**SEE NOTE 3 BELOW**)
Please note that our Debt Counsellors are trained to understand what options are available and would know whether an IVA or bankruptcy was a viable solution to your financial situation. Had these options been suitable, they would have been discussed. IVAs and bankruptcy are forms of insolvency and involve legally binding agreements.
(**SEE NOTE 4 BELOW**)
A basic calculation to see whether an IV A may be appropriate would be to see how much money an individual would be able to repay to their creditors over a five year period which is the usual duration of this type of agreement. In your case, you had surplus income of £420 per month. Over a period of 60 months, this would give a total of £25,200. In addition to monthly repayments, an individual's assests are also considered.
You had property equity of approximately £37,000 and this would be likely to have increased further over a five year period. (**SEE NOTE 5 BELOW**)
When combined, these sums exceed the amout of money you owed. As a result, this means an IVA would not have been a solution to your situation. Your creditors would not have accepted a proposed IVA, which would usually involve writing off a proportion of your debt, when you could afford to repay your debts in full.
For similar reasons, bankruptcy was also not considered to be an appropriate solution for your situation. In addition, your property would potentially have been at risk and as you were employed by a financial institution your job could also have been affected.
Having reviewed your file, I feel that our advice for you to repay the money you owe via a DMP was correct based upon the information supplied. (**SEE NOTE 6 BELOW**)
UNQUOTE
I have several comments on this....
NOTE (1) CCCS state '...you decided that you would prefer to take up a Debt Management Plan (DMP)'. The only other option that I was advised of was bankruptcy. I was not offered any other options but banruptcy or DMP so how could I choose any other option? Their letter re-affirms the fact that the CCCS NEVER mentioned the existence of the IVA facility let alone discussed it as a potential option
NOTE (2) CCCS state '...The notes on your file show that you were made aware of the estimated duration of the repayment plan. ..' Yes, the CCCS did make me aware of the estimated duration of the DMP, HOWEVER they did NOT Advise me that a creditor MAY record an 'Arrangement to Pay' on my credit file until the debt was cleared which could effectively be for the duraction of the DMP PLUS 6 years (equalling nearly 15 years of impact to my credit file...simple math shows this to be equivalent to 2 1/2 bankruptcies! I feel that it is totally unacceptable that the CCCS did not advise me of this possibility!!!)
NOTE (3) CCCS state '... Notes on your file indicate you told us that your circumstances were likely to improve so that a higher monthly repayment would become available in the future. This would mean your debts could be repaid over a shorter period of time.
Excuse me...but anyone with a basic level of intelligence would understand that a person's circumstances could potentially improve over a 10 year period? I was entering this DMP with a (in hindsight misguided) positive mindset!
NOTE (4) The CCCS state '...Please note that our Debt Counsellors are trained to understand what options are available and would know whether an IVA or bankruptcy was a viable solution to your financial situation. Had these options been suitable, they would have been discussed. IVAs and bankruptcy are forms of insolvency and involve legally binding agreements. ..'
I re-iterate that the CCCS NEVER mentioned the existence of the IVA facility let alone discussed it as a potential option
NOTE (5) The CCCS state '...You had property equity of approximately £37,000 and this would be likely to have increased further over a five year period.'
I feel that this stated assumption is outrageous. I have now spoken to quite a number of people on this forum and other financial forums who have gone through an IVA and all have had equity in the properties and in 4 of the cases, far greater equity than I had in my home
NOTE (6) ... The CCCS state '...Having reviewed your file, I feel that our advice for you to repay the money you owe via a DMP was correct based upon the information supplied.'.
The CCCS conveniently forget at this point that they never discussed the potential option of an IVA so I feel their statement above is totally without foundation and integrity
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I would really appreciate comments and feedback from any of you who visit these forums as do feel that I have been a receipient of wholly inappropriate financial advice from the CCCS that will impact me for a far greater period than it ever should have.
Many thanks
TG
