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Debt management companies should be avoided

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I do not know if any of you reading this have found themselves in an unfortunate situation with debt and have approached (or even considering to) a debt management company.

I am remaining anonymous for this gripe as I found myself in this very distressing, delicate situation myself only last year.  I was enjoying annual leave for a few weeks then I had a telephone call, completely out of the blue, from an organisation - I will not mention their name; there was a very friendly advisor on the line who asked me to discuss ALL my financial details, income, outgoings, you name it!

I was on the phone for nearly 2 hours, heavily embroiled in all matters financial, and after offering such intensive, personal information, he had written everything down and spoke very frankly with me and informed me, in no uncertain terms, that I was in debt of over £3,500!

I was very shocked to say the least - it was then he explained that they will help by negotiating with my various creditors, and pay a monthly manageable sum.  I would then pay them a (what I consider very exorbitant) monthly fee of £290.  I signed up, with the assurance that, as soon as my plan was up and running, that I would have no hassle from creditors anymore, be it, telephone, email and more worryingly, being visited at home!!

The first monthly payment became due a month later, which I was more than happy to pay, with the peace of mind that I would have.  It all seemed fairly stress-free initially, but I then became aware of telephone calls, on my mobile, land line and rather threatening letters about possible court action or bailiffs.  This started happening regularly and this was affecting my performance at work as these "missed calls" were constantly showing up on my phone.  This caused me such stress, that I had to take days off work and it has affected me physically and I now have ongoing problems.  They do say that stress affects people in different ways.

Debt management - cutting up credit cards a few pounds went to creditors whilst the rest was retained for "admin processing fees"

To cut a long story short, I was approached by another debt management company (I will stick with the one I'm referring to; I'll be as brief as possible with this "new" one).  The very helpful advisor I spoke to told me, in so many words, that the company I was registered with was NOT listed on the Reputable Traders website, and that out of the £290 monthly fee that I was paying, only a few pounds went to creditors whilst the rest was retained for "admin processing fees" etc.

I was absolutely livid!!  And as for this "personal adviser" I was registered with - he would ask me to forward on any further communications and pass on the details of any phone calls that I would receive - I did all this, BUT, more often than not, I could never get through to my adviser, so I'd be permanently moved "from pillar to post" and having to explain EVERYTHING over and over EACH TIME!

To anyone considering paying an exorbitant fee for a debt management company - DON'T!

I have since come away from these organisations and am paying my debts off, satisfactorily, happily and independently - it's saved me a great deal of stress (and probably money too)!!

To anyone considering paying an exorbitant fee for a debt management company - DON'T!  They lead you into a false sense of security.  I feel that all they wanted was my money with little self-assurance.  Apologies for the tone of this gripe but I feel very let down with it all!


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LisaMJ

LisaMJ

Don't use debt management companies as they charge you a fee for their services, I was using one and payment them £110 pm, £30 of that was for their service, they also don't and cannot help you with all your debts. If you are in debt and need help, use StepChange or the CAB. Both are free and neither charge you for a service.
LisaMJ
12th Apr 17 08:17

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Next

Next

Warning as household debts rise to top £1.5 trillion
BBC News - ‎22 hours ago‎
Household debts have risen to £1.5tn in the UK for the first time, new statistics show. After a period of flat growth, debt has begun to rise again in recent years.

Still, there are too many people around that cannot distinguish between the meaning of "want" and "need." The warnings of debt seem to fall on deaf ears when the big flash car, latest iphone, 55 inch super curved telly, expensive holidays abroad etc, etc, are easy to pile on a credit card. Just wait until the interest base rate stars to climb. This is why debt collection firms NEVER go bust.
Next
8th Nov 16 11:31

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ahforfoulkessake

ahforfoulkessake

I do not have a credit card and buy expensive things on it.
I fell behind on regular bills because of my work being up and down and hence my income also.
And advice to Jing Jong if you are for real,: man up and tell her straight to get a job and get off her lazy backside. Give her enough towards bills and don't show her payslip or bank statement so she won't know exactly what you've got coming in.
Occasionally when its a special thing like her birthday or Christmas or other special day treat her to something as a surprise that you know she would like.
ahforfoulkessake
29th Mar 14 16:07

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Jing-Jong

Jing-Jong

Hi lads I'm a hard working Chinese man. I work my butts off in the kitchen of a Chinese restaurant and yet still, payday isn't a happy day for me because I must hand over the entire amount of my salary to my wife immediately. Each week she gives me only enough pocket money to buy a pack of cigarettes. "Men will become bad if they have too much money", she always says. Now you'll understand why most Chinese men look worried/unhappy.
Jing-Jong
3rd Dec 13 15:52

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Dave

Dave

Cheap credit = luring people into an unsustainable lifestyle
Dave
3rd Dec 13 15:38

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Thomas

Thomas

Same as me anon, I enjoy the new year and watching the morons in my area that are stressed to breaking point trying to pay the nevernever card bills. They might have all the latest toys but the novelty soon wears off, and then the headaches/stress/money rows/sleepless nights staring at the ceilings start...... Oh you stupid people.
Thomas
3rd Dec 13 14:42

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Nick

Nick

Yeah but you still pay them annual fee don't you although I suppose the cashback you earn is enough to cover that.
Nick
3rd Dec 13 14:25

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Friday Lunchtime

Friday Lunchtime

The best debt management is to not use your credit card for more than you have in your current account to settle it in full at the end of the billing period. That way you never need to pay any interest and you don't get into a spiralling cycle of debt.
I get 1% cashback on most of my credit cards and never pay any interest - they pay me.
Friday Lunchtime
3rd Dec 13 14:03

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Nick

Nick

Mr Wonga come and rescue us pleeeeeeease
with your wonderful 5853% APR
Mr Wonga lend me some dough
Mr Wonga you're number one!
Nick
3rd Dec 13 13:59

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Nick

Nick

Now we have a new generation of young people with an "I don't care! I want it!" attitude. Britain's financial future is doomed.
Nick
3rd Dec 13 13:52

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anon

anon

Reports today from British financial watchdogs state that, in the run up to Xmas, record numbers of people are raiding what little savings they have left, in an effort to maintain their credit acquired lifestyle. British people still cannot bear the thought of cutting back with their "want it" attitude, while knowing their incomes are not sufficient. I'm really looking forward to the period after Xmas when credit card bills start to fall on peoples door mats and the great wailing begins. Happens every year, I would have thought people would have learn't the painful lesson by now, but there's now accounting for stupidity.
anon
3rd Dec 13 11:12

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Nick

Nick

The best debt management is to drop your credit card into a jar of water and then stick the jar in the freezer so that every time you want to spend again on some new clothes or a new phone, you'd have to wait for the ice to melt, during which time you would have already changed your mind about your purchase.
Nick
2nd Dec 13 14:25

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ahforfoulkessake

ahforfoulkessake

I may have been a little hasty in saying how good the company were that are dealing with my case.
They are taking roughly half of the money every month as their fee despite telling me that they were only taking two £90 payments for first two months as their profit margin before the £60 a month that will go to the three creditors.
They sent me a statement for the recent £60 payment which shows that they are taking half of it leaving only £10 per month to each of the three companies I owe money to.
My current payment is due out today as its 1st of the month. I have left them with no money to take from my bank account and I will simply inform them when they ring me that I no longer require their services and will talk direct to the companies themselves.
They can be reasonable and not charge interest as long as you make some kind of offer and stick to paying when you agree to.
I'm not staying in debt more than twice as long just to make some debt management company rich, they can stop leeching off the poor and desperate.
ahforfoulkessake
1st Dec 13 11:54

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Money Grabbers

Money Grabbers

There are only real two ways out of debt:

Money, Cash, Spondulicks in hand

or

Exile, Escape, Moonlight-flit.

Wonga agents will come and find you wherever you are.
Money Grabbers
4th Aug 13 16:34

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ahforfoulkessake

ahforfoulkessake

I am trying to get a loan now of between £500-1000 so I can do training courses for work and earn better money from the jobs they will open up to me and then I can repay loan faster than I could at the moment.
This is a better way to do it rather than debt consolidation.
I am on a monthly plan where I only pay £90 for first two months, just paid 1st payment the other day then £60 every month after the first two until my debts are paid.
I will be out of debt in less than two years as I only have small debts in the first place to overdraft at the bank, money shop and thames water of maybe 1000 in total.
The company Im with make their money by charging the extra 30 for first 2 months then they take about 17.5% off every monthly repayment until its all cleared off.
They freeze interest so the debts you start with don't go up further.
I think Ive been lucky to find them and not get into more debt elsewhere trying to repay old debts.
ahforfoulkessake
4th Aug 13 12:46

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