Debt Solutions

Where your debt levels become overwhelming and you can no longer make payments, you are of no further use to the lender. This is when they usually sell on your debt to debt collectors who unlawfully use threats of legal action to force you to repay. Click below to see if you qualify to have your debts legally written off. Do You Qualify? Secure, Discrete & Confidential. 100% Free Advice. No Obligation

Many people start looking at traditional options for dealing with debt listed below. A whole industry of debt solution firms and advisors has developed over recent years to assist individuals who find themselves burdened with unmanageable debt – in exchange for a fee naturally!:

Individual Voluntary Arrangement (IVA);
Debt Consolidation;
Debt Management Plan (DMP);
Debt Relief Order;
Bankruptcy.

Whilst these options can assist in managing the debt or reducing the monthly payments, none of the options result in the debt being totally cancelled or written off without implications. Of greatest concern is that several of these options can seriously impair your credit rating for a number of years – making it very difficult to obtain credit in future. However, there is a little known sixth option - namely:

Debt Cancellation

As the name suggests, by exploiting certain defects in the original credit agreement, it is possible to have the debt completely cancelled without affecting your credit rating at all! In effect, the debt is written off on one or more legal technicalities. Not only this, since the agreement is legally unenforceable, at the discretion of the judge, payments made to the lender can be reclaimed! It is similar to receiving a parking ticket cancelled when you’ve clearly double-parked but the ticket is unenforceable as the traffic warden wasn’t wearing his hat at the time of issue!

Our alternative Debt Cancellation approach to helping clients become debt free is a simple process that can potentially help remove debt quickly utilising our knowledge of the law. Click below to see if you qualify to have your debts legally written off. Do You Qualify? Secure, Discrete & Confidential. 100% Free Advice. No Obligation

What Types of Debt Can Be Written Off?

By challenging the legality and enforceability of credit agreements, we have successfully written off these debt types:

Credit Cards
Payday Loans
Personal Loans
Store Cards
Debt Collectors
Catalogues

What Are The Disadvantages of Traditional Debt Solutions?

The following sections take a brief look at the various disadvantages of the traditional debt solutions listed above. It will be clear at the end that the only viable option is ‘Debt Cancellation’ since there is no downside. Although it may all look too good to be true, it really is possible to cancel your debt legally without being penalised in any way!

1. Individual Voluntary Arrangement (IVA)

What is an IVA?

Where you have unsecured debts of at least £15,000, you are in regular employment and can afford a repayment of at least £250 to £300 per month, an Individual Voluntary Arrangement (IVA) offers a legally binding agreement between you at least three creditors where you commit to make monthly payments into your IVA for a period of at least five years. All monthly payments into the IVA are distributed to the creditors based upon the terms of the IVA.

Since all interest and charges are frozen as part of the IVA, this breaks the cycle of debt. The arrangement is set up through an Insolvency Practitioner and payments are based upon your income and expenditure. Providing the agreed repayments are met during the IVA, no bankruptcy or legal proceedings can be filed against the debtor.

What are the disadvantages of an IVA?

Only 40% of the debt might be written off. Although most debt solutions companies claim that more than 75% or more of the debt can be written off with an IVA, the reality is that in many cases this figure is likely to be much lower – around 40%.
Your credit rating will be adversely affected. The IVA will impair your credit rating and will remain on your credit file for 6 years. Even after the end of the arrangement, it will often still be difficult to obtain credit and it is likely that you will be charged premium interest rates for credit.
Limited living expenses permitted during the IVA. During the 5 year term of the IVA, you will only be permitted minimal living expenses. If you fail to keep up payments and the IVA fails, your situation will revert to your original situation regardless of the payments you have made into the IVA. In the worst case, it could result in bankruptcy proceedings.
You may be required to forfeit any equity from your property. If you own property that has increased in value during the term of the IVA, the creditors could insist that you remortgage the property and release equity in order to make further payments into the IVA thus increasing your total debt.

Our alternative Debt Cancellation approach to helping clients become debt free is a simple process that can potentially help remove debt quickly utilising our knowledge of the law. Click below to see if you qualify to have your debts legally written off. Do You Qualify? Secure, Discrete & Confidential. 100% Free Advice. No Obligation

2. Debt Consolidation

What is debt consolidation?

As the name suggests, debt consolidation involves taking one large loan with a lower interest rate in order repay many other loans. The lender may be willing to offer you a lower interest rate if you secure the loan against assets – typically your house. As a result, you will be making reduced monthly payments on a single manageable debt held with a single creditor.

What are the disadvantages of debt consolidation?

You could lose your home if you default. Where the lender requires security for the loan, you risk losing your home should you be unable to maintain repayments;
You will typically pay double the interest. Although your lender may lower your monthly payments, over the long term you will pay much more in interest. Since the term of these loans is typically 15 years or more, you could pay nearly twice as much in interest;
Your lender could sell on your loan to an unscrupulous third party. If your lender goes out of business or sells your loan to a third party, you could find yourself in legal and financial difficulty;
Early settlement charges and insurance will increase your total indebtedness. Your indebtedness will increase where your have to fund early settlement charges, or you are pressurised into taking out further borrowing for a payment protection insurance premium;
Some loans may also require a co-signer. Where a loan requires a co-signer, the risk to a co-signer is that if you default, they are liable.

3. Debt Management

What is debt management?

Where you do not have large enough debts to consider an IVA (typically less than £13,000), a Debt Management Plan (DMP) enables you to repay your debt in a way that is affordable by offering creditors a reduced monthly repayment which is manageable.

The process involves noting all your debts, assessing your income and budget and then renegotiating payment terms and interest with your creditors.

What are the disadvantages of debt management?

Negotiations with some creditors could be unsuccessful. Since the DMP is an informal agreement with your creditors, some of them may refuse to be part of any plan;
Your creditors could insist on immediate payment of the whole debt at any time. Since the DMP is an informal agreement with your creditors and not legally binding, they can still send correspondence to you and could choose to opt out of the DMP at any time - demanding immediate payment of the whole debt;
Repayment of the debt could take you many years. Since there is no defined term for the agreement and where your surplus income is low, you could making the repayments for many years;
Your credit file will be impaired. Since the arrangement will show on your credit file for 6 years, your credit file be impaired which will make it very difficult to obtain credit in future.

4. Debt Relief Order (DRO)

What is a Debt Relief Order?

Sometimes referred to as a mini bankruptcy because of the many similarities between the two, a Debt Relief Order (DRO) is a form of insolvency for people struggling with debt.

The process involves noting all your debts, assessing your income and budget and then renegotiating payment terms and interest with your creditors.

What are the disadvantages of Debt Relief Orders?

Homeowners are ineligible to apply. if you own your own home, you cannot apply for a DRO.;
DRO can only be granted if your total debt is less than £20,000. If you have debts of more than £20,000, you won't be able to apply for a DRO;
The DRO will appear on your credit file for six years. Whilst most DRO’s end after 1-year and allow you to then become debt free, your credit rating will be affected for a total of six-years. This means that during these six-years you will find it extremely difficult to get loans and other related financial products
You'll need permission from the court to set up a business. You can't promote, manage, or set up a limited company, without permission from court. Also, you can't act as a company director, without getting permission from court.

5. Bankruptcy

What is bankruptcy?

All bankruptcies start with a bankruptcy petition presented by a creditor or by the debtor themselves. It reflects the inability of an individual or organisation to pay their creditors – who may file the petition where at least £750 is owed (i.e. involuntary bankruptcy) in an effort to recoup a portion of the debt. In order to show that the debtor is not able to pay their debts, a creditor usually relies upon either the debtor's failure to comply with a statutory demand for payment, or upon their failure to honour a court order to pay a debt.

When the bankruptcy order is discharged, the bankruptcy comes to an end and the bankrupt is released from most of their previous debts, and freed from most of the disqualifications that affect a bankrupt.

What are the disadvantages of bankruptcy?

As an extreme method for dealing with unaffordable debt, there are many disadvantages and negative consequences compared with other debt solutions such as an IVA:

The social stigma of bankruptcy. This is exacerbated by the fact that all bankruptcies are advertised in the local press;
All valuable assets will need to be forfeited. You will be required to hand over any valuable asset such as your property to the trustee;
Any business you own will be closed. If you own a business, as a bankrupt it will be closed and your employees will be dismissed;
All your financial accounts will be closed. As a bankrupt, all your bank and building society accounts will be closed and you will forfeit all your credit cards;
Your employment prospects will be affected. As well as having difficulty securing employment in future, you will also lose your professional and business status;
Difficult and very limited access to credit. As a bankrupt, you will not be allowed to try and obtain credit for £500 or above without disclosing your bankruptcy history.

Our alternative Debt Cancellation approach to helping clients become debt free is a simple process that can potentially help remove debt quickly utilising our knowledge of the law.

Click below to see if you qualify to have your debts legally written off. Do You Qualify? Secure, Discrete & Confidential. 100% Free Advice. No Obligation

6. The Solution: Debt Cancellation

What is Debt Cancellation?

After describing other debt solutions in the previous sections, if we said we could write off 100% of your credit card debt and personal loans without any disadvantages, you would probably say that it was too good to be true. However, using our expert legal team, we can assist you in legally cancelling your debts with your creditors completely. More than that, we can potentially even claim back payments you’ve already made to those creditors and in most cases you can have your credit file cleared if you’ve fallen into arrears - since the related agreements will be unenforceable.

To reiterate, debt cancellation is nothing like other debt solutions that involve negotiation with creditors. Instead, by challenging the credit agreements on little known legal loopholes, it is possible for you to wipe out all of these debts without impairing your credit rating at all.

Some may question the morality of avoiding repayment of a debt by using legal technicalities. However, it is your legal right to challenge your credit agreements in accordance with the Consumer Credit Act. If the lender has been negligent in drawing up the agreement, they should suffer the consequences.

How to benefit from the Consumer Credit Act

The Consumer Credit Act 1974 legislates that credit agreements must meet certain criteria – known as ‘prescribed terms’. However, as unbelievable as it sounds, we have found the majority of these agreements don't i.e. the lenders have been negligent and failed to draw up a legally binding agreement. Furthermore, when the original lender sells the debt to a debt collector, the original documentation doesn't get passed across. This makes the agreements unenforceable i.e. the creditor cannot legally enforce you as the borrower to repay the debt – allowing our legal team on your behalf to have any outstanding debt written off.

For example, under the terms of the Act, within 12 working days (plus 2 days for post!) the credit company is obligated to provide a certified copy of the original credit agreement that you signed when you took out the card - for a statutory fee of £1. This is your legal right as a consumer. Believe it or not, in many cases the credit company loses these agreements or shreds them! If the lender has not sent the agreement by one calendar month after the 12 days is up, they commit a summary (criminal) offence rendering the agreement unenforceable.

There are a number of other areas where a credit agreement could be challenged. For this reason, a detailed legal check is made by our legal team – resulting in a maxi audit report. The list below contains some of the prescribed terms mentioned above that could render a credit agreement unenforceable:

the interest rate isn’t clearly stated and correctly calculated.
credit/store cards do not state the credit limit or level of monthly repayment.
the agreement does not state the amount of credit.
a consumer hire agreement does not contain information as to how a hirer is to discharge his/her obligations.
the agreement is not signed.

Our alternative Debt Cancellation approach to helping clients become debt free is a simple process that can potentially help remove debt quickly utilising our knowledge of the law.

Click below to see if you qualify to have your debts legally written off.

Do You Qualify? Secure, Discrete & Confidential. 100% Free Advice. No Obligation