FAQs
What happens if my Repayment Proposal is rejected?
If your lender rejects your repayment proposal, you should initially contact them to ask them why your offer is unacceptable, as they have an obligation to consider any reasonable offer. You should also review your Budget Plan to see whether all of your expenditure allowances are reasonable or whether any items could be reduced to enable you to increase your Repayment Proposal. You can use the letter template provided on this website. It's important that your Repayment Proposals are sustainable, but you will also be expected to cut back on non-essential spending.
Even if your repayment proposal has been rejected, still make the payment as this will show that you are committed to repaying your debts. This will help your case should one of your lenders take you to court.
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The interest and/or charges exceed my monthly payment. What should I do?
If interest or charges are bigger than your monthly repayment, you need to speak to your lender and ask them to consider reducing or freezing their charges, as continuing with these could prevent you from repaying your debt. Try using the letter template provided here.
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If I decide to get professional help, how can I be sure I'm dealing with a reputable company?
There are many debt solutions companies offering different services, so it's important that you understand the service each provide and what the cost will be. You can check on their literature or website to see if they belong to any trade associations, such as DEMSA (The Debt Managers Standards Association). DEMSA are the first trade body within the finance industry to successfully secure approval for its code of practice under the Office of Fair Trading's Consumer Codes Approval Scheme (CCAS).
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Why would a debt collection agency become involved?
If you have consistently missed payments or ignored any lender communications, your debt may be passed on to an external agency. Even if you have written to your lenders, enclosing your Budget Plan and commenced the reduced payments, your lenders may still pass your account on. If this is the case, it is important that you supply the debt collection agency with a copy of your Budget Plan, Repayment Proposal and start making repayments to them.
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How do I deal with bailiffs?
It is vital to treat any communications from a bailiff as you would a priority debt and respond immediately as they have extensive powers of enforcement. You may be able to reach an agreement with them direct, through the court or via your lender/utility provider. You should also consider taking immediate independent advice, particularly if you are unable to come to an affordable repayment arrangement.
Bailiffs are not normally allowed to use force to gain entry to your home, but it is perfectly legal for them to enter through an open window or unlocked door. Once you have allowed the bailiff in or they've used peaceful means to enter your home and levied your possessions, they are entitled to return and use force, if necessary, to seize these possessions. The exception to this is when the debt is owed to HMRC or from an unpaid magistrates' court fine: in this case it is legal for a bailiff to use force to break into your home, providing they have a magistrates court warrant.
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I've been sent details of a County Court Hearing. Do I have to attend?
It's always advisable to attend the hearing as it gives you an opportunity to represent yourself. If you don't attend, a decision will be made in your absence that may not be right for you. Make sure you have completed all the forms required and you have an accurate account of your income, expenditure, unsecured debts and repayment proposals.
Don't panic; your hearing will not be in front of a jury. The County Court process is designed to reach an agreement between you and your lenders and can actually help your situation by bringing about a conclusion.
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I can't get a bank account. What can I do?
You may have been turned down because you're applying for accounts that offer credit facilities (such as overdrafts). You should be able to get a basic bank account that provides all the essential facilities. For details of the basic bank accounts available and the services you can expect to receive visit www.moneymadeclear.fsa.gov.uk
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I have fallen behind on payments to a County Court Judgment (CCJ) - what can I do?
First contact your lender or the appointed debt collection agency directly to see if they will be flexible with your repayments, or if they will agree to a payment towards the arrears. If your lender doesn't agree or you have received documents from the court, you should contact the court or an independent adviser immediately for help.
Once in arrears, a CCJ can be enforced in a number of ways: through a Warrant of Execution (sending a court bailiff), an Attachment of Earnings (deduction from your wage), a Third Party Debt Order (freezing money held in a bank account) or through a Charging Order (secured against an asset, typically your home).
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