Lenders Vs IVA Companies

Filed Under  IVA News, UK Debt News  |  Leave a Comment

Lenders are warning IVA companies to take a 40% cut in their fees or face the probability of IVAs being rejected.

Currently IVA companies are free to charge whatever fees they see fit, however, this could no longer be the case.

The British Banking Association (BBA) are to meet the representatives of the debt management industry in London on Thursday 31st May. The meet is the result of rising anger over the costs of IVAs.

A spokesman for the BBA said:

We have held a series of working parties working on proposals for a code of conduct for IVA providers and we now want to pull this work together.

Currently fees by some IVA companies average around £7,500, and although the BBA cannot set a maximum price for IVA’s, they will be telling leading IVA providers that they will no longer pay more than £4,500 for each deal brokered.

Concern has kicked in regarding the summit and has hit IVA Company shares hard, with the value of 3 major IVA providers, Accuma, Debtmatters and Debt Free Direct all falling sharply over the last fortnight.

According to the Dept. of Trade and Industry, 44,000 borrowers entered into IVAs last year, a 450% increase since 2002 who saw 8,000 deals brokered.

The fees charged by leading IVA companies could be the result of lenders being stricter with accepting IVA proposals. A typical IVA borrower now has to repay between 40p and 45p of each £1 owed, this is up from 18p to 20p only 3 years before.

Click here for more information on Individual Voluntary Arrangements (IVAs)

Gas Customers in Credit

Filed Under  Personal Finance  |  Leave a Comment

Money Supermarket have announced that Gas customers are in credit by £490m!

During the winter months, gas companies have approx. £490m of unspent money, this means that on average, nearly 9 million people who pay by direct debt are likely to be in credit by £56 with their gas utility provider.

Chief Executive Duncan Sedgwick said:

For every person in credit there is at least one other person in debit to their energy supplier. This is because over the course of the year people use three times more gas during the winter than they do in the summer and paying by direct debit conveniently spreads the cost of the bill throughout the year.

He added

All the energy suppliers regularly review the amount of their customers’ direct debit payments and people can call their company at any time to discuss the amount they should be paying

Source: Credit Today