Debt Advice – £12,000 loan

I’ve got a £12,000 loan with HSBC which I’ve been paying for the past 24 months. Following being made redundant in September last year, I was unable to keep up with the re-payments.

After 6 months of unsuccessful negotiations with HSBC via the Citizens Advice Bureau, HSBC have now referred this case to their ‘in house’ debt collection agency (Metropolitan) I believe they are called. This took place yesterday!

My question is…what to the best of your knowledge are the EXACT steps the debt collection agency will take to recover the money and what are their powers to get the money back (repossesions, coming into my house, court) etc.

Thanks for your time and ill add extra info as requested.


No matter what you do do not refuse to pay your debt. Let them know you can pay only a specific amount, debt collection agencies will take on the debt which means you will owe it to them rather than HSBC. Wait until they make contact with you and explain the specific situation to them.

Bailiffs can not come into your property and take things without a court order, which courts do not hand out like confetti. If the loan is a secured loan on your home then they could repossess but this is not automatically done

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Debt advice – settlement offers?

A few years ago I applied for 2 credit cards and a loan, I was given more than I could pay back, and I was too busy enjoying myself to realise…bad bad idea.

Anyway, for the last 3 years I have made small payments to the 3 companies, and this isn’t likely to change as I don’t earn much. For example, I pay £10 a month on a £3000 debt. The interest has been frozen on these debts.

My parents have offered to give me £4000 to try and settle the debts. Each company will be offered 50% of the amount I owe as full and final settlement. The total I owe is £8000.

Has anyone got any experience with making these offers? Am I deluding myself thinking that there may be a chance they will accept these offers? I would be grateful of any advice.


If you’ve been in arrears and also under control with the debt recovery departments, there’s every possibility they’ll accept your offer of 50% total and final settlement. Especially if the lenders have now referred your accounts to a different firm for collection.

Be sure you put your offer in writing, explain that your parents definitely will bail you out with half the money, obtain acceptance in writing, and more importantly ensure you get a letter confirming the account is closed and that the credit reference agencies have been notified. You should follow this up in a few months to check your files have been amended correctly – they won’t be wiped but should show as “satisfied”.

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Coping With Your Debt – Solve the problem

Are you in the position where there is a chance of losing your home or your car? Perhaps you’re falling behind with settling your bills, debt collectors are knocking on your door and creditors are harassing you for payment…

Take heart. You are not the first (nor the only) person facing such a financial crisis. Regardless of whether your current situation was caused by job loss, sickness or overspending- being in this position can seem to be a long, dark road with no end or solution in sight. The reality is that this state of affairs can be overcome and that your situation does not have to deteriorate any further.
One of the first things you can do to bring matters under control is to take a hard-nosed look at your cash flow- how much money do you bring in and how much money is flowing out? Write down your total income from all sources combined, and then make a list of all your fixed expenditure (Expenses that do not vary from month-to-month such as repayments on your vehicle, insurance premiums, mortgage payments etc.) Next item would be variable expenditure and here you’d include all expenses that are not fixed (like dining out, entertainment, clothing, etc.)

Do not neglect any item of expenditure, even if it’s a small amount. Be as precise as you can. This will give you an immediate and exact overview of where your money is going to every month. Obviously, there are the indispensible expenses and those are priority number 1. Assign priority scores to the rest of the items. The object of the exercise here is to be sure that all of the basic necessities like food, your house, health, children’s education, insurances, etc. are covered.

You will find a wealth of information on budgeting and managing your money in libraries and bookstores as well as on the internet. There are also plenty of computer programs available that relate to money management. Most have ready-made features to set up and maintain a budget, keep track of your check book, bank account’s and credit cards.

Many people are reluctant to do the following, for very obvious and understandable reasons: If you find yourself in a financial tight spot and unable to make all payments contact your creditors immediately and inform them that you are having difficulty meeting your scheduled payments and inform them of your reasons for having this problem. Most will be happy to co-operate with you and to revise your repayment commitment to a level that is achievable. Do not wait until your account is seriously in arrears and you face having to now deal with a debt collector. If that point has been reached, it means that the creditor has abandoned hope of finding a settlement with you and has resorted to handing over your account to a debt collector.

A good credit counsellor will be able to assist you with quality advice on money management and coping with debt, as well as guide you through setting up a budget and most often offer educational materials and workshops. Trained and certified debt counsellors are knowledgeable on subjects like credit, debt and money management. A good counsellor will sit down with you and do a detailed analysis of your financial situation, with a view to developing a personalised program to solve your financial difficulties. You can expect the initial consultation to last for about an hour. Follow-up sessions may also be suggested.

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Beware of Bad Debt Advice

Due to the current financial climate, the United Kingdom has become overrun with debt management companies and as a means to draw in customers they often promise un-deliverable results. Like many industries you have the honest experts and the fraudsters, it is up to you to seek out those who will really help you and those who will only claim to.

Of course, it is possible to rid yourself of massive debts and a poor credit rating through a professional repayment plan, however it can also desperately worsen your situation. It is important to thoroughly research any debt management company you are considering using before committing to any payment plan.

Many untrustworthy companies use talented sales people to seduce potential customers into signing on the dotted line. Keep an eye out for companies who advertise via television and newspaper adverts, it is more sensible to employ a small firm who will value your business relationship. These smaller companies do not need sleek sales tactics to convince you they are genuine, their customer testimonials and past records will do this for them.

Advice from the Voluntary Sector

Voluntary sector debt advice establishments work very closely with non-profit advice services within the community. Although they are very much involved with these organisations, they play a more backstage role, without direct interaction with the public.

When seeking debt management advice be sure you know who you are getting it from. There is an obvious difference between socially motivated voluntary sector centres and fee-charging advice centres. Several of the fee-charging centres have names which do not determine whether they are voluntary or not, often misleading individuals who use them. The ambiguity of their company names implies that their advice is also not trustworthy.

It is vital with any financial problem that people in all situations are able to access sound free and impartial advice, and although there is a market for fee-charging companies they must not be the only solution.

Therefore, it is important to fully research any company you are trusting to help you with debt problems.

Advice from imposter debt advisors

Over the past few years, as the need for financial advisors has increased, reports of ‘cowboy’ debt management companies have sky rocketed. This is the main reason why you must fully investigate any company you are thinking of using to help you with your debt management.

These imposter companies take huge amounts of money from clients, both individual people and businesses, without offering any kind of relief from their struggling situation. This is done as they need to recuperate all the money they spend on advertising.

So, ensure that you seek independent professional advice before being caught up with the flashy lights and promises of a large company.

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debt advice
Debt Management Tips

debt adviceEach of us knows the feeling: it’s month end, we have a handful of bills to pay, have to go to several different banks and post offices to pay them, and all the time we are worried that we’ll pay the wrong amount to the wrong creditor.  If only we could arrange our debt management a little better, our lives would be just so much easier.  But, the fact is that your debt management need not be overly complex; provided that you arrange the management of your debt in a sensible way.  The following are some useful tips on how best to control your debt management:

1. Debt Management – The Standing Order

Nearly all creditors will allow you to make a monthly standing order payment to repay their debt.  Although paying your debt by means of a standing order doesn’t mean that you reduce the number of creditors you have, it does make the day-to-day running of your debt management so much easier.

2. Debt Management – The Direct Debit

Like the standing order, the direct debit is a monthly payment that you agree to make to your creditor.  However, unlike the standing order, a direct debit is not for a fixed amount each month; but, rather, is for all outstanding debt you have as of the day the direct debit is due.  As such, direct debit debt management is not particularly popular, it’s seen as messy – and if the creditor takes more than you accounted for, it becomes very difficult for you to survive the remainder of the month on the money you have left.

3. Debt Management – Online Banking

A very popular method of debt management these days is to open an account with a bank that lets you do all your banking and debt management via the internet.  This way you can arrange to pay all your bills on time, without having to leave the comfort of your home or office, whilst still having control over the debt management process.

4. Debt Management – Reduce The Number Of Creditors

If part of your debt management problem is the sheer number of creditors you have, why not think about reducing this number of creditors by means of consolidating your debt.  For example, if your have 3 credit cards, why not just make this one credit card debt by paying off the other 2 credit cards using the balance on your third card?  Alternatively, depending on the level of savings you may obtain, why not consider paying off your credit cards altogether by asking your bank to provide you with a personal loan.  Then all you need to do is to arrange to pay off your bank.

As you can see then, debt management strategies do not need to be too difficult, you just need to give some thought as to how best to arrange your debt management.  In this regard, it is probably best that you do not arrange your debt management program where you are walking around the high street at the end of the month with an envelop full of money trying to find the easiest way to pay back each of your creditors!

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Serious debt advice needed?

I need some much needed advice, I had a fashion catalogue which I always paid but since losing my job its been hard to make the payments and they have threatened me with visits from bailliffs can anyone advise me if the are allowed to do this as I was told that they cant for this kind of debt. any help will be very appreciated.


In theory no they can’t, they have to take you to court and be awarded the right to bring in bailiffs.

A court will generally not allow this to happen if you’ve made an attempt to pay them even if its £1 a week. Write them a letter (make 2 copies and send one to them recorded) stating that you are currently experiencing financial difficulties and can’t afford to pay the repayments but will offer £x a month to clear the debt as soon as possible. State that you would appreciate it if they froze any further charges to the account.

Legally they can not decline your attempt to repay if its reasonable. so long as you make an attempt even if they say no a court won’t order in bailiffs.

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What is an IVA?

IVA stands for an Individual Voluntary Arrangement and enables a person with financial difficulties to put into place a legally binding payment plan in order to pay off outstanding debts. An IVA is settled between the individual in question and the people they owe money to, their creditors.

As an IVA is legally binding it can only be set up by a licensed professional known as an Insolvency Practitioner.

Applying for an IVA

Upon an Insolvency Practitioner agreeing that an Individual Voluntary Arrangement is suitable for you and your circumstances, you shall settle on an achievable monthly repayment amount. You will need to provide information concerning your current financial situation in order for this to be an appropriate amount that you shall be able to pay every month.  Once this information has been agreed you shall be required to sign an official proposal.

An Interim Order shall then be applied for through the court by your Insolvency Practitioner. No creditors shall be able to take legal action against you once this order is in place, however you may be asked to attend a meeting with your creditors. However, this is very rare and you are usually only required to be contactable via telephone on that specific day.

At the creditors meeting, your individual creditors will be asked to vote for or against the IVA.  It only takes one of your creditors to vote ‘for’ the IVA in order for it to be accepted. On the other hand, if only one creditor votes ‘against’ the IVA, and they represent 25% or more than your total debt combined then the meeting shall be classed as pending, and the creditors that did not vote shall be called to do so.

However, if the creditor that voted ‘against’ the IVA still stands for more than 25% of the total debt, despite the other creditors voting ‘for’ the IVA, then the IVA will be rejected. This is due to the fact that an IVA will only be granted if 75% of the monetary value of the debt is voted for. But, if the IVA is granted it binds all creditors, even those who did not vote.

Advantages of an IVA

Once your IVA is in place your debt charges and interest fees are frozen. This means that your creditors are no longer able to demand payments from you or continue to add interest and tax onto your debts.

Rather than struggling to pay monthly instalments to several creditors, an IVA enables you to pay one reduced amount a month. This amount gradually pays off any debt and typically lasts for five years.

The monthly instalments are calculated from the individual’s monthly income minus their expenses. Because an IVA is legally binding, unlike Debt Management Plans, if the monthly instalments are paid regularly for the duration of the agreed period, once this period comes to an end you shall be free from the debts, regardless of how much has been paid off.

Your financial position is reviewed regularly throughout the period of your IVA to determine whether or not your situation has changed. This is done in order to ensure that you are financially able to stay committed to the IVA.

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Can anyone give me some advice on debt?

My son has recently started getting letters demanding payment for a debt that is approximately 11-12 years old. So he has been told….
He has no idea what this is for and the previous debt collection office couldn’t tell him so he asked them in a telephone call to provide this information.
They have not responded and he has now received the same demand from another debt collection agency.

Can someone still try and collect on this after so long without giving any information as to what it is?


In England the Limitations act means debts expire after 6 years (Scotland is 5 years)

The exception is secured debt (12 years) and county court judgments which can be pursued at any time – along with crown debts.

The debts can still be chased and it isn’t illegal to do, the debt collector would have bought it very cheaply.

Do not admit the debt.

Ask the debt collector for proof of the debt and if it is indeed 11-12 years old write back a “without prejudice” letter pointing out it is statute barred.

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How can I solve my debt problems and get a mortgage?

I currently live in council accomodation with my husband and 3 children. We both work but cannot get a mortgage as we both have debt problems. I desperately want to change our situation and get on the housing ladder but I need to solve my debt problems.

Any tips would be great.

I currently have a repayment plan but it is going so slowly at this rate I'll be paying it off in 15 years time!


Here are the steps you need to take:

1) Start keeping track of where your money goes. Yes, this means starting a budget.

2) When you realize where your money is going, find ways to shave costs. Look for way sof consolidating costs if you can, like instead of having insurance on each individual debt, have one individual term policy. Or instead of dealing with seperate people for cable, internet and phone, see if you can switch somewhere and get some bundle discounts. Also, assess your spending into things that are manditory and things that are not manditory. Manditory things are the basics for living. Power, water, shelter, food (not steak and lobster every night either), clothing (within moderation). Stuff like entertainment, cable TV, internet are all things that are not manditory. All non manditory things get split into 2 catagories “life enhancing” and ” non-life enhancing” Life enhancing things would be things like internet…makes things more convenient. Life enhancing things might be going out for A beer and wings with your buddies once a month. Non-life enhancing things would be things like Cable TV with 600 channels…even anything more than basic cable isn’t nessasary, there are better uses of your time. The goal is to eliminate ALL non-life enhancing expenses.

3) once you’ve freed up some cashflow we get cracking on the debts. Let’s say you were able to get rid of £200 of expenses that you didn’t need. Take that £200 and apply it to the payment amount for your smallest debt amount (these are ussually the credit cards or things with the highest interest rate as well). for example, if your smallest debt was a £2000 credit card with monthly payments of £50. Now you will be paying £250 a month to pay it off.

Once that first debt is paid off, take the entire amount you were paying (in the example, the £250) and apply it to the paymnets you are currently making on the next smallest debt. Let’s say that’s a loan for £5000 and the payments are £300/month. Now you are paying £550/month on that one. As you can guess by making almost double the payments, you will get this paid off far sooner.

When that one is paid off, take the entire amount and apply it to the nest debt. Let’s say it’s another loan for £8000 with payments of £400. Now your payments will be £950 (the previous £550, plus the £400), so this will get cleared up in less than a year, rather than the 5 or 6.

Continue doing this until you’ve cleared up ALL your debts. When they are all cleared up, you will be used to making those regular payments so you might as well put the money into a savings account, or put it towards a mortgage payment.

This snowball repayment plan will rapidly increase the amount of time it takes to pay down your debts and it will also give you a sense of accomplishment becuase you are picking off debts along the way, rather than scattering payments and not seeing debts going away. This strategy is promoted my most financial professsionals like Richard Kiyosaki (author of Rich Dad, Poor Dad series), Dave Ramsey (don’t waste you money on the book, you just got the jist of it), and credit consultation companies all over the world.

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What happens to a debt incurred overseas?

I am based in the uk and am a uk citizen. I incurred a debt in usa through a timeshare purchase – will the debt collection agency take me to court here? Will they send bailiffs? Will a uk court order me to pay? I have explained to the timeshare company my financial situation; I have never used the timeshare and hoped they might just sell it on – no such luck!

If they do business in UK chances are they have a local UK office or at least local rep. … so they MIGHT pass it on to a UK Debt Recovery Agency ..

Check the details of your contract very carefully … it is possible it may not be enforceable in UK …

But you should NOT ignore it .. I suggest your write disputing the contract eg. by claiming that the sales rep lied to you .. look through any adverts / paperwork you got before you signed up – quite often they will say something like ‘its easy to sell unused weeks so you never make a loss’ or some other blatant lies that convinced you to buy.

NB. Usually the Timeshare owner (i.e. YOU) has to be the one to take action to ‘sell it on’ (again, often the Rep will say something like ‘if you don’t like it we will buy it back / sell it on for you so you can’t make a loss’ etc. .. )

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