Debt Solver Review
If you are looking for financial advice and support in the UK, you have literally hundreds of companies or organizations to choose from. You may want to consider Manchester-based Debt Solver as a possible solution for your needs or problems.
Debt Solver is a part of Accuma, one of the 2 largest debt advice companies in the UK. Accuma is a publicly traded company listed with the Alternative Investments Market on the London Stock Exchange. Accuma is expanding rapidly, due to their recent acquisitions of the firms Wilson Phillips, a personal insolvency firm, Loan Line, a debt consolidation company and Byrom Heeley, a debt advisor firm. With their rapid growth and expanding services, Accuma may see profits of ₤2.1 million this year. (www.growthcompany.co.uk)
What does Debt Solver do?
They basically provide debt advice to consumers regarding financial difficulties . They will analyze your situation and advise you on possible solutions, such as:
- Debt consolidation
- Debt management
- Remortgages
- County Court Administrative orders
- Bankruptcy
- IVAs (Individual Voluntary Agreements) (www.debtsolver.co.uk)
The company offers a free and confidential consultation to determine your best method for getting out of debt. Although they have traditionally specialized in IVAs, other options are available.
Why are IVAs so popular lately?
As the rate of UK personal debt continues to rise to record levels, currently ₤1.5 trillion,(www.mortgageintroducer.com) more and more people are becoming insolvent. The IVA is becoming the method of choice in these situations. Insolvency rates hit a new high for the 2nd quarter of 2006, with 26,021 cases, an increase of 66% from 2005. Of these insolvencies, 11,105 were IVAs, a 153% increase from 2005. (www.uk.biz.yahoo.com)
IVAs were originally legislated by the Insolvency Act of 1986 as a method for sole traders to avoid bankruptcy and remain in business.(www.bankruptcy.uk.net) However, in recent years, they have become much more common in individual cases. Some authorities believe this rise is at least partially influenced by the proliferation of debt management and IVA companies.
Cliff D’arcy in a Motley Fool article writes, “Personally, I believe that the astounding rise in the number of IVAs is due to one factor: the sheer number of newspaper and television advertisements from debt management companies promoting IVAs as an easy way to dump debts.” (www.uk.biz.yahoo.com)
Many consumers prefer IVAs over bankruptcy, as IVAs allow individuals to keep their homes and are not publicly advertised. Creditors often prefer IVAs because they generally receive a higher percentage of repayment as compared to bankruptcies. (www.ivas.co.uk)
How do IVAs work?
An IVA is a legally binding agreement between you and your creditors, administered and managed by a supervisor. This supervisor can be a company such as Debt Solver, or an individual attorney. After a review of your finances, an IVA may be recommended to you. A proposal is written up by an insolvency practitioner, detailing your debts and what you can afford to pay. This proposal is sent to the court, and an interim order is issued, which stops any creditor‘s legal actions against you. A meeting is set up with your creditors, and the creditors vote on whether to accept the proposal.
75% of your creditors (by value) must agree to accept the proposal. Then the proposal is signed and administered by the company or practitioner. You will make 1 payment per month to a supervisor and they will distribute payments to your creditors. IVAs usually last for 5 years and at the end of this period, if you have made payments as scheduled, the balance of debts will be discharged or written off.
How much does an IVA cost?
Debt Solver advertises IVAs with no upfront fee. They say “Debt solver does not charge you a fee at all. IVAs are funded by creditors.” However, they also note that “Proposal, implementation and management of an IVA is a time-consuming and expensive process and these costs reduce the amount that is finally repaid to your creditors.” (www.debtsolver.co.uk)
According to Myvesta, a non profit financial advice organization, large debt management companies expect to earn an average of ₤7,000 per IVA client. ₤1,000 to ₤2500 of this is for a nominee fee at the beginning of the process and this fee comes out of the debtor’s payments. An additional ₤500-900 supervisory or management fees are charged per year and these fees are paid by the creditors. (www.myvesta.org.uk)
Customer comments regarding Debt Solver
If you are considering Debt Solver as a possible answer to your problems, you may be interested in what previous customers have to say about them.
Debt Solver provides several case studies on their website showing how they have resolved problems and reduced payments for clients. Some examples include:
- Julie---total unsecured debt of ₤43,000. Payments reduced from ₤615 to₤345 and wrote off debts of ₤23,000
- John---total unsecured debt of ₤73,000. Payments reduced from ₤1700 to ₤622. and wrote off debts of ₤32,000.
- Louise—total unsecured debt of ₤33,000. Payments reduced from ₤900 to ₤281 and wrote off debts of ₤16,000.
Testimonials included:
“Your help made a difficult situation easier to deal with and I felt confident that you were giving me good advice.”---Miss B.
“A huge thank you to your superb team who have helped my family and I through our financial nightmare.---Mr H. |
