In today’s competitive world living a normal life is practically impossible. Expectations from the family members force an individual to borrow money from various lenders. If a loan is not possible then a credit card comes handy. But at the time of repayment this poses a serious problem as one may discover that his expenses have outrun his income and he is under a huge pile of debts. Easy debt settlement not only helps to clear multiple debts of a borrower but can also revive his credit rating. It also saves a borrower from embarrassing situations like CCJ, defaults, IVA and arrears.
Debt consolidation is considered as the best option of all the options of debt management available in the market. This option helps to clear all the debts by taking another loan of the total amount of all the loans from a lender at a low interest rate and a repayment term which suits the borrower. Debt consolidation Loan is of two types — secured and unsecured. Secured debt consolidation is for those borrowers who can pledge collateral against the loan amount. Hence the interest rates are low. Secured loan amount starts from $25,000 to $75,000. The repayment tenure is 10 - 25 years. An unsecured debt consolidation is available without collateral which makes the interest rates higher in comparison to the secured one. An unsecured loan offers $25,000 and the tenure is maximum 10 years.
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Thursday, October 15, 2009
Monday, September 28, 2009
Banks' exploitation of obscure law could see rise in IVA needs
The revelation this week that banks have been taking money from customers' savings and current accounts without their knowledge, could lead to a rise in the number of individual voluntary agreements (IVA).
Under an obscure law, banks have been able to take money owed to them by customers from alternate accounts held by that customer, according to the Guardian.
Known as "setting off", this secretive practice by the banks could see people's savings plummet and result in them facing potentially serious financial difficulties.
According to the Guardian, the Financial Ombudsman Service (FOS) has huge increase in the quantity of referred cases linked to setting off.
In April 2008, the FOS received 50 cases; in April this year, that figure stood at 578.
This figure rose even further in June, with a spokesperson from the FOS claiming that over 1,100 cases had been received that month alone.
With the number of hardship cases linked to setting off increasing so severely, the effect of the banks' surge in action is clearly quite pronounced.
Depending on the significance of the debt problems people face, they should consider various forms of debt management advice or perhaps an IVA.
Under an obscure law, banks have been able to take money owed to them by customers from alternate accounts held by that customer, according to the Guardian.
Known as "setting off", this secretive practice by the banks could see people's savings plummet and result in them facing potentially serious financial difficulties.
According to the Guardian, the Financial Ombudsman Service (FOS) has huge increase in the quantity of referred cases linked to setting off.
In April 2008, the FOS received 50 cases; in April this year, that figure stood at 578.
This figure rose even further in June, with a spokesperson from the FOS claiming that over 1,100 cases had been received that month alone.
With the number of hardship cases linked to setting off increasing so severely, the effect of the banks' surge in action is clearly quite pronounced.
Depending on the significance of the debt problems people face, they should consider various forms of debt management advice or perhaps an IVA.
Tuesday, September 15, 2009
IVAs: Help Avoiding Repossession
Released on May 15th, the CML's figures show that 12,800 repossessions were carried out by first-charge mortgage lenders in the first quarter of 2009. "Compared with many predictions, these figures are relatively low," said a spokesperson for Gregory Pennington. "Indeed, the CML itself has used the word 'pessimistic' in reference to its own estimate of 75,000 repossessions throughout 2009, and has recently revised this figure downwards to 65,000.
"It's good to see lenders and borrowers working together to keep the figure as low as possible, but it's important not to become complacent. There were still around 23% more repossessions in Q1 2009 than in the previous quarter - and 50% more than we saw in Q1 last year.
"Looking ahead, the repossession figures for the rest of 2009 are by no means set in stone. They depend not just on the state of the economy and the forbearance shown by secured lenders, but on the attitude of borrowers and unsecured lenders alike.
"In this recession, many people are suffering multiple 'shocks' at the same time. With 2.2 million unemployed and many others dealing with reduced wages, homeowners are also facing the issue of falling equity. While there's no direct link between low (or negative) equity and repossession, this is limiting many homeowners' ability to access ways of dealing with their debt - from debt consolidation loans and remortgaging to downsizing to a smaller property.
"It all underlines the importance of finding a solution that addresses a borrower's priority and non-priority commitments at the same time. A founder member of DEMSA (the Debt Managers Standards Association), Gregory Pennington has 15 years' experience of dealing with lenders of all kinds.
"Secured and unsecured lenders alike clearly have a thorough understanding of the problems consumers face today. They understand the link between secured and unsecured debt problems.
"Secured lenders know that many of today's borrowers are facing complex financial problems, trying to deal with unsecured debts as well as secured.
"Unsecured lenders, in general, appreciate that a homeowner's secured debts must take priority - and that repossession is unlikely to improve the borrower's chances of repaying their unsecured debt.
"This is one reason unsecured lenders will often agree to the terms of an IVA (Individual Voluntary Arrangement)."
A solution that's designed to address the concerns of everyone involved, an IVA can help unsecured lenders recover as much of their money as realistically possible, and can help borrowers avoid the need to focus on their mortgage / rent at the expense of their unsecured debts. Insolvency Practitioners (IPs) achieve this by calculating how much the individual can realistically afford to repay per month after they've taken their mortgage / rent payments and other essential expenses into account.
"Even so, we always emphasise that entering an IVA is a serious step, and is by no means suitable for everyone facing debt problems. Depending on their situation, different homeowners may be better advised to consider alternative solutions to their debt problems."
Source
"It's good to see lenders and borrowers working together to keep the figure as low as possible, but it's important not to become complacent. There were still around 23% more repossessions in Q1 2009 than in the previous quarter - and 50% more than we saw in Q1 last year.
"Looking ahead, the repossession figures for the rest of 2009 are by no means set in stone. They depend not just on the state of the economy and the forbearance shown by secured lenders, but on the attitude of borrowers and unsecured lenders alike.
"In this recession, many people are suffering multiple 'shocks' at the same time. With 2.2 million unemployed and many others dealing with reduced wages, homeowners are also facing the issue of falling equity. While there's no direct link between low (or negative) equity and repossession, this is limiting many homeowners' ability to access ways of dealing with their debt - from debt consolidation loans and remortgaging to downsizing to a smaller property.
"It all underlines the importance of finding a solution that addresses a borrower's priority and non-priority commitments at the same time. A founder member of DEMSA (the Debt Managers Standards Association), Gregory Pennington has 15 years' experience of dealing with lenders of all kinds.
"Secured and unsecured lenders alike clearly have a thorough understanding of the problems consumers face today. They understand the link between secured and unsecured debt problems.
"Secured lenders know that many of today's borrowers are facing complex financial problems, trying to deal with unsecured debts as well as secured.
"Unsecured lenders, in general, appreciate that a homeowner's secured debts must take priority - and that repossession is unlikely to improve the borrower's chances of repaying their unsecured debt.
"This is one reason unsecured lenders will often agree to the terms of an IVA (Individual Voluntary Arrangement)."
A solution that's designed to address the concerns of everyone involved, an IVA can help unsecured lenders recover as much of their money as realistically possible, and can help borrowers avoid the need to focus on their mortgage / rent at the expense of their unsecured debts. Insolvency Practitioners (IPs) achieve this by calculating how much the individual can realistically afford to repay per month after they've taken their mortgage / rent payments and other essential expenses into account.
"Even so, we always emphasise that entering an IVA is a serious step, and is by no means suitable for everyone facing debt problems. Depending on their situation, different homeowners may be better advised to consider alternative solutions to their debt problems."
Source
Friday, August 28, 2009
TrigoldCrystal adds debt management module to sourcing system
TrigoldCrystal is releasing a new debt management module to their Prospector AAA mortgage sourcing system.
The new module will provide brokers with the opportunity to help clients who may be struggling to meet their financial commitments.
With the new Debt Management module on TrigoldCrystal brokers can demonstrate that they have explored the immediate options available to their clients and where these options are either unavailable or inappropriate they will be able to refer the client to a specialist debt manager.
The system will offer a panel of firms who specialise in this area with leading debt solution provider EuroDebt already live on the system.
Accessing debt management is quick and simple from either the ‘edit client’ screen or following a debt consolidation review.
David Aylmer, marketing director at TrigoldCrystal believes that the audit trail provided by the system is crucial. “Usually the use of a debt management solution comes at the end of the process when more traditional vehicles such as a remortgaging are not available. It is therefore crucial that brokers confirm that this type of referral is the correct option for their client.” He said.
“With this is mind we have built a series of questions into the programme to help brokers and their clients determine whether referral to a debt management company is the right option. The answers to the questions are recorded and automatically saved into a ‘Debt Management Suitability’ document. This ensures that there is a permanent record for the protection of the broker and the client. We’re delighted to announce the launch this new facility and look forward to announcing new partnerships with debt management firms over the coming weeks and months.”
Kevin Still, director at EuroDebt, added: “EuroDebt is delighted to be the first debt solution provider in the Debt Management and IVA facilities of Prospector. We have been working with the broker community for 9 years and have a sizeable number of partners and introducers that are Trigold users. The simplicity of the data transfer mechanism from a mortgage or debt consolidation loan application to the referral facility is a great help and productivity tool. We are working with Trigold on a joint communication plan to their user base and the wider intermediary community.”
Source
The new module will provide brokers with the opportunity to help clients who may be struggling to meet their financial commitments.
With the new Debt Management module on TrigoldCrystal brokers can demonstrate that they have explored the immediate options available to their clients and where these options are either unavailable or inappropriate they will be able to refer the client to a specialist debt manager.
The system will offer a panel of firms who specialise in this area with leading debt solution provider EuroDebt already live on the system.
Accessing debt management is quick and simple from either the ‘edit client’ screen or following a debt consolidation review.
David Aylmer, marketing director at TrigoldCrystal believes that the audit trail provided by the system is crucial. “Usually the use of a debt management solution comes at the end of the process when more traditional vehicles such as a remortgaging are not available. It is therefore crucial that brokers confirm that this type of referral is the correct option for their client.” He said.
“With this is mind we have built a series of questions into the programme to help brokers and their clients determine whether referral to a debt management company is the right option. The answers to the questions are recorded and automatically saved into a ‘Debt Management Suitability’ document. This ensures that there is a permanent record for the protection of the broker and the client. We’re delighted to announce the launch this new facility and look forward to announcing new partnerships with debt management firms over the coming weeks and months.”
Kevin Still, director at EuroDebt, added: “EuroDebt is delighted to be the first debt solution provider in the Debt Management and IVA facilities of Prospector. We have been working with the broker community for 9 years and have a sizeable number of partners and introducers that are Trigold users. The simplicity of the data transfer mechanism from a mortgage or debt consolidation loan application to the referral facility is a great help and productivity tool. We are working with Trigold on a joint communication plan to their user base and the wider intermediary community.”
Source
Monday, August 3, 2009
More borrowing 'could boost need for IVAs'
People may be increasingly in need of a debt management solution - such as an individual voluntary arrangement (IVA) as new figures indicate a trend toward borrowing, rather than paying down debts.
Unbiased.co.uk chief executive David Elms stated that while many consumers shifted away from saving to pay off outstanding debts last year, 2009 has seen a return to more borrowing.
He explained that although the markets appear to be making a slow recovery from the economic turmoil, it is" vital for consumers to continue nurturing their financial position".
Mr Elms added that people who are concerned about their personal finances should seek independent, professional advice before deciding which debt management plan is right for them.
Earlier this week, the Times suggested that new initiatives by credit card firms which will see reduced minimum payments could keep people "stuck" in debt for longer.
Those who can no longer keep up with their payments may wish to consider an IVA as an alternative to bankruptcy - with regular monthly payments, consumers could emerge debt-free from such an arrangement within five years
Source
Unbiased.co.uk chief executive David Elms stated that while many consumers shifted away from saving to pay off outstanding debts last year, 2009 has seen a return to more borrowing.
He explained that although the markets appear to be making a slow recovery from the economic turmoil, it is" vital for consumers to continue nurturing their financial position".
Mr Elms added that people who are concerned about their personal finances should seek independent, professional advice before deciding which debt management plan is right for them.
Earlier this week, the Times suggested that new initiatives by credit card firms which will see reduced minimum payments could keep people "stuck" in debt for longer.
Those who can no longer keep up with their payments may wish to consider an IVA as an alternative to bankruptcy - with regular monthly payments, consumers could emerge debt-free from such an arrangement within five years
Source
Monday, July 20, 2009
Credit card minimums 'could increase need for IVAs'
Reduced minimum payments on credit cards could increase the need for people to seek a debt management solution, such as an individual voluntary arrangement (IVA).
The Times reported this week that some £3.5 billion is currently "stuck" on credit cards bearing interest, as consumers are not able to switch to additional zero per cent deals when their current plan expires.
Further compounding the problem, providers such as Barclaycard have reduced their minimum repayment from 2.25 per cent to 1.5 per cent for some consumers - leaving them in a state of "perpetual debt" as it will take them longer to pay back what they owe.
As the recession continues to negatively impact household finance, those who are already struggling with credit card debt could find their troubles increase in the long-term if they only make minimum payments, it claimed.
People who are experiencing debt troubles may wish to examine an IVA as an alternative to bankruptcy.
Guardian Money blogger Ivy A wrote this week that when faced with the choice, her family opted to take on an IVA because the arrangement allowed them to remain in their home.
Source
The Times reported this week that some £3.5 billion is currently "stuck" on credit cards bearing interest, as consumers are not able to switch to additional zero per cent deals when their current plan expires.
Further compounding the problem, providers such as Barclaycard have reduced their minimum repayment from 2.25 per cent to 1.5 per cent for some consumers - leaving them in a state of "perpetual debt" as it will take them longer to pay back what they owe.
As the recession continues to negatively impact household finance, those who are already struggling with credit card debt could find their troubles increase in the long-term if they only make minimum payments, it claimed.
People who are experiencing debt troubles may wish to examine an IVA as an alternative to bankruptcy.
Guardian Money blogger Ivy A wrote this week that when faced with the choice, her family opted to take on an IVA because the arrangement allowed them to remain in their home.
Source
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