English case studies
English DMP
Katie is 38 years old and lives in a mortgaged property. When Katie’s marriage split up, the marital home was sold and Katie had to downsize to a small flat. Katie used her credit cards to furnish her accommodation, and took out a loan to help pay her bills while she got over the break up of her marriage.
After a year, Katie realised that she could not afford the minimum repayments to her creditors and in total owed around £14,000 to 4 different companies. Katie spoke to a mortgage advisor in the hope that she could remortgage her property, however he advised her that she had very little equity in her property. As an alternative, Katie was advised to speak to Newtomorrow Broker Services. The financial advisor arranged for Katie to receive a telephone call from an experienced debt advisor. After a telephone consultation, we advised Katie that the best option for her would be to enter into a Debt Management Plan.
Newtomorrow Broker Services were able to organise a Debt Management Plan whereby Katie makes a monthly payment of £350, which is then distributed among her creditors.
All interest on her debts was frozen and Katie now has a realistic chance of being debt free within 4 years. The mortgage advisor that recommended Newtomorrow Broker Services to Katie received a fee for supplying the contact details and fact find pack.
IVA
Brian is an IT consultant aged 39. Six years ago his marriage broke down and he divorced. Brian left the marital home for a rented flat. His wife and three young children remained in the home. Brian remarried and has a young child with his new wife, Andrea, but still lives in rented accommodation. When his first marriage broke down he had several personal loans in his name totaling £20,000 but his finances were under control as both he and his wife had worked.
When Brian left the marital home he had to find new accommodation and provide financial support for his children. This, together with unforeseen circumstances reducing Brian’s income, meant he struggled with his debts which quickly reached £40,000. When he remarried and his wife gave birth to their new child the situation had become unmanageable. Brian did not want to walk away from his debts but realised he was unable to pay them in full. He contacted his financial advisor who recommended speaking to Newtomorrow Broker Services.
Once Newtomorrow Broker Services spoke to Brian we set up an Individual Voluntary Arrangement which was accepted by his creditors. Under the arrangement Brian makes a regular monthly payment of £280 over a five year period. Although he will only repay around 40% of his debts he will be debt-free when the IVA is complete.
Full and Final Settlement
Charlie is 49 years old and lives in a mortgaged property with his wife Sharon. Charlie and Sharon lived extravagantly, and took advantage of credit card and loan offers. They both had large cars, and went on three holidays a year.
Charlie realised they were in trouble when he had to take out a loan just to cover the monthly repayments to his creditors. At this point, Charlie and Sharon realized that they owed £38,000 to several creditors, and decided to contact their financial advisor, Mark. He reviewed the couple’s situation and realised that Charlie and Sharon could not remortgage and pay their debts in full, so decided to call Newtomorrow Broker Services.
After a telephone interview, we advised Charlie and Sharon to offer a full and final settlement to their creditors, using the £27,000 of joint equity in their house to clear. Once the creditors accepted the proposal, Mark arranged a remortgage and Charlie and Sharon released the equity in their property and arranged to make a one off payment to their creditors. Charlie and Sharon have now repaid 71% of the debt and the creditors have agreed that they will not have to repay the outstanding sum of money.
Mark received a referral fee for supplying a fact find pack with Charlie and Sharon’s details. He also received a fee from the lender when he provided the remortgage.
Scottish case studies
Scottish DMP
Thomas is a 50 year old married engineer from Ayrshire who owns a house jointly with his wife. Thomas and his wife Jenny ran into financial difficulty when Thomas lost his job and was out of work for a year. During this time, Thomas paid for the majority of the families living costs through using credit cards. When Thomas got back into work his debts totalled £9,000.
Thomas felt that his debt was unmanageable and called his financial advisor, Gregg. A remortgage looked to be the most appropriate solution, however Gregg had already refinanced Thomas earlier in the year. The home had a negative equity of £8,000 so another option had to be explored. Gregg had heard that Newtomorrow Broker Services offered free debt advice and decided to find out more information. Later that day Gregg sent the fact find pack to Newtomorrow Broker Services and we called Thomas to discuss his debt problem.
Newtomorrow Broker Services spoke to Thomas to confirm the details and recommended that a debt management plan would be the best course of action to help pay off his debts.
Thomas pays an agreed sum every month to a Debt Management Plan, which distributes the money on his behalf. Thomas has now removed all pressure from his creditors and will be debt free within 3 years. Gregg received a fee for passing Thomas onto Newtomorrow Broker Services.
Trust Deed
Mary is 59 years old and is employed earning £11,000 per year in receipt of a pension. She lives in rented accommodation.
Unfortunately, Mary’s partner died just two months before they were due to be married. Her partner, Darren, earned substantially more than Mary so the joint debts they had were manageable, until he passed away.
Darren also failed to write a new Will which left Mary with debts of £59,000. Mary spoke to a local financial advisor who was recommended to her by a friend. Paul, the financial advisor was unable to offer a refinancing solution as Mary did not own her house, so he decided to call Newtomorrow Broker Services.
Paul sent us all of Mary’s financial details so that we could call her to discuss her debts. An experienced advisor assessed her situation and recommended a Trust Deed. Mary had a disposable income of £600 per month which she paid every month for 36 months. At the end of this period she was completely debt-free and almost 65% of her debt was cleared.
Paul received a fee for supplying Newtomorrow Broker Services with Mary’s fact find pack.
Mary told us “I wish to take this opportunity of thanking you for all your help in reaching a satisfactory Protected Trust Deed. I am so grateful and wish to say thank you so much to your company.”
Trust Deed
Steven was 29 years old and married. He lived in a house he owned jointly with his wife. He took advantage of a number of credit cards and loans. He lived significantly beyond his means for a number of years. Steven had two holidays a year and had two cars - one for himself and one for his wife, Jane.
He realised he was in trouble when he had to take out a loan just to meet the minimum repayments on all his credit cards. At this point he had debts totalling £30,000 and an income of £980 per month. He had joint equity in his home of £10,500. Despite being in a considerable amount of debt, Steven ignored the letters and telephone calls from creditors requesting payment. His wife stayed at home to look after their two small children.
As he approached his 30th birthday he realised he had no possibility of repaying his debts.
Steven’s financial advisor suggested speaking to Newtomorrow Broker Services, so he sent us Steven’s details. After speaking to Steven we recommended a Trust Deed and the proposal was accepted by his creditors. Steven paid an affordable amount of £230 per month for 36 months, as well as releasing his share of the equity in his home (£5,250) after a period of 24 months. After 36 months Steven was completely free of the debts incurred and this allowed him to look forward to his future without the worry of debt.
If you had referred Steven to Newtomorrow Broker Services, you would have received a referral fee once the Trust Deed was protected. Also, when Steven was releasing the equity within his property, this would have been referred back to you with the opportunity to earn a re-mortgage fee.