BW Legal has delivered training to Simon on the Street’s outreach team to give them a better understanding of Debt Rehabilitation.
Since the start of 2019, we have been raising money and awareness for the Leeds-based homeless charity. While fundraising plays an invaluable role, we provided Simon on the Streets outreach workers with information on what help is available to individuals struggling with debt.
Our Learning and Development Trainer, Rhodri Cook and Supervising Solicitor Zarvin Vandrewala delivered the training. They discussed how we engage with our customers to understand their circumstances and help them on the road to financial recovery.
Zarvin Vandrewala, who is also the Corporate Charity Ambassador for BW Legal, said: “We recently delivered a training session to the outreach workers at Simon on the Streets. These individuals are tasked with visiting individuals who are homeless and their job is never an easy one.”
“A lot of the time they are asked questions relating to debt and so this training session revolved around rehabilitation and what positive steps could be taken.”
Problems with Debt
Debt continues to be a major problem, with people in the UK owing a total of £1.576 trillion at the end of January 2018. According to Step Change, the top three causes of debt are reduced income, unemployment or redundancy, and illness or injury.
In 2018, 657,930 new clients contacted Step Change for help with problem debt; equal to one new client every 48 seconds.
These figures show that while it is not unusual to be in debt, dealing with problem debt continues to be a serious concern for those affected by it and can quickly feel beyond your control.
However, that is often not the case and there are steps that can be taken to help you on the road to financial recovery.
What is Debt Rehabilitation?
Debt rehabilitation is a process that helps you pay off, reduce or eliminate your debt. This is done by employing a number of solutions to assist those struggling with debt. While there is no instant remedy, there are ways to make debt more manageable.
“In essence Debt Rehabilitation is about helping a customer sort through their financial affairs and getting them back on track,” explains Zarvin.
“Here that usually involves discussing circumstances and a customer’s financial position with the hope that a pragmatic conclusion can be reached i.e. – an affordable repayment plan.”
“The main point discussed throughout the session was the need to ensure contact is always made. A lot of tips, ideas and topics were things which the outreach team were either struggling with from a knowledge point or factors that they had not previously considered.”
What Help is Available?
One of the first steps toward debt management is getting a full and realistic picture of your financial position, including any income and expenditure.
This enables us to put in place an arrangement that is affordable and sustainable. It will also ensure that all priority bills are paid, such as mortgage and rent arrears, and utilities.
“During the session we discussed what options were available for an individual who is struggling with debt or any other type of financial pressure,” said Rhodri, who spent five years working in Collections helping customers manage their debt by working with them to set up sustainable payment plans.
“Whilst discussing debt rehabilitation, we looked at the best available options for customers. Simon on the Streets were interested in gaining more information regarding Debt Relief Orders.”
A Debt Relief Order (DRO) is a way to deal with your debts if you have a low level of debt and don’t have many assets. A DRO will freeze your debts for up to 12 months and after that they could be written off.
Universal Credit is also available to those on a low income and replaces six other benefits with one monthly payment.
“A Debt Relief Order is a type of insolvency which can be available for individuals who are struggling financially and is commonly used due to potentially allowing you the opportunity to have your debt written off after 12 months as long as your circumstances have not changed during this period,” explained Rhodri.
“However, there are certain criteria you must meet prior to being eligible for a Debt Relief Order, for example, there is a fee of £90 (some charities may help towards the cost), your debts are not worth more than £20,000 and you do not have any assets (including a car) totalling more than £1,000.”
However, Rhodri warned that there are some drawbacks to a DRO and customers should focus on long-term debt management rather than a quick-fix.
“Many individuals see the end goal as a benefit, however, the future impact on an individual can be large. Once you have been in a Debt Relief Order or any other type of insolvency, it can become difficult for you to gain credit in the future, this may also include mortgages or rent.”
“Insolvency can sometimes be seen as a quick fix for individuals, however, the best route for debt rehabilitation is to manage your debt with the first step being to contact the creditor for whom the debt is outstanding to.”
“This will enable you to discuss your circumstances and agree a suitable and maintainable repayment arrangement or gain the relevant advice you may need.”
If you are struggling with your finances or concerned about debt issues, then don’t hesitate to reach out for help. For independent debt advice, contact any of the following:
Step Change on 0800 138 1111
Money Advice Service 0800 138 7777
Payplan 0800 280 2816
National Debt Line 0808 808 4000
The Insolvency Service 0300 678 0015
Mind 020 8522 1725
Advice Now 0345 345 4 345
Gingerbread Charity 0808 802 0925