The past year has seen a marked rise in the number of banks 'setting off' debts against savings.  This is the practice where a banks will use a consumers savings to offset any missed payments on their debts.

In April 2008, the Financial Ombudsman Service saw 50 cases of hardship, that were linked to the setting off process.  In April 2009, that number had risen to 578.  They have already received 1100 for June this year. 

Some debt management customers have found that money has been taken from their accounts to civer missed payments, and has left some unable to pay their mortgage, bills, or even buy food.  The FOS said that it is often small amounts that are being taken, with banks even taking money from state benefits.

The CCCS have reported a 45% rise in the last year, but give a warning that their advisers would probably report the problem under the banner of debt repayment or similar, leading to an underestimate.

The Banking Code Standards Board is due to publish a report on the banks using this process wrongly by the end of the summer.

If you feel as if you have been wrongly affected by setting off, then call MRA Debt Help on 01424 777156 to speak to one of our debt counsellors.

Banks have been critisised this week for the extortionate interest rates charged for their unauthorised overdrafts.

In the last 12 months the Bank of England base rate has dropped from 4.5% to 0.5%, yet borrowing costs have remained high.  Many debt management clients come to us having used their overdrafts, and even exceeded them, and have found that this has cost them dearly. 

The average unauthorised overdraft rate has not dropped from its high of 13.5%.  At the same time, the interest rates offered by the same financial institutions on customers savings has plumeted from 3.24 to 0.6%.

Pierre Williams from moneyexpert.com said "It's galling for customers who've seen savings rates plummet over the last 12 months to realise that banks are refusing to budge for the rates that they charge on overdrafts."

If you are constantly in your overdraft, or have any querires about debt, call MRA Debt Help on 01424 777156

This week has brought some interesting news regarding mortgages.  Some good, and some bad, but all should hold some interest for our regular debt mangement blog readers.

Our first bit of news is that the FSA has referred 4 firms to its enforcement department for they way they handle their mortgage arrears.  This doesn't directly affect our debt management plans, due to the plans being based around unsecured lending as opposed to secured mortgage lending, but it could pave the way for regulation of the unsecured loan market. 

Also of interest is that some lenders have decided that to reduce the amount of debt on their books, theyll offer people reductions to move their mortgage!  Yes, you read right, lenders such as GMAC are offering customers up to £25000 off of their mortgage to move it elsewhere.  This is a drastic measure by the lenders, with Mortgage Express offering to waive redemption penalties to do the same.

If you are struggling with secured or unsecured debts, call MRA Debt Help on 01424 777156

The insolvency service has released figures to show that young women have overtaken young men in the numbers of people falling into bankruptcy.

Accountancy firm Wilkins Kennedy analysed the figures, and has reported that the numbers of young women entering itno forms of insolveny has risen to 1560.  The report, which states that the number of consumers from both sexes under the age of 24 that went bankrupt in the last 5 years rose by 10%.  Women made up 55% of all bankrupts under 24 last year.

Credit card debts and rising rent/mortgage payments are blamed for this increase.  Young women are becoming more and more likely to overspend, with rising peer pressure to live the life of celebrities such as 'Victoria Posh Spice Beckham' and 'Katie Jordan Price'.  The increased availability of credit over the last 5 years has contributed greatly, by offering people the ability to make lavish purchases on credit cards and loans.

If you are struggling to make payments on credit cards, loans or any other debts, call MRA Debt Help on 01424 777156 to speak to one of our debt counsellors

I have stumbled upon a blog by debt free helpline recently, and it is something that worries me somewhat.  At MRA Debt Help, we are very aware of making rash debt advice statements with out a suitable explanation.  Debt is a very emotive subject and making such statements can encourage people to rush into debt solutions without seeking proper debt advice.

Reading debt free helplines blog, you might think that bankruptcy should be avoided at all costs, and that an IVA will be a better solution for all consumers.  They make several incorrect statements, that coming from a supposed debt help organisation is quite worrying.

For some consumers, who are really struggling with debt, Bankruptcy may potentially be the only solution.  In such instances, where the consumer has no way of making the payments towards an IVA, accepting such an agreement can cost the consumer thousands.  If a consumer defaults on an IVA, they are still liable for the debts, will have paid the Insolvency Practitioners charges, and may still end up going bankrupt.

Debt free helpline also state that bankruptcy will 'taint your credit rating for life', and that an IVA 'keeps your reputation and credit rating intact'. 

As you can see with information from the Insolvency Service, a bankruptcy will usually last for one year.  At this point, providing you have complied with the requirements of your order, the bankruptcy may be discharged.  The bankruptcy order will normally stay on your credit file for 6 years from the date it started.  An IVA can last for around five to six years, depending on the agreement, and will stay on your credit file for 6 years. 

'Debt free helpline' writing such nonsense makes a mockery of the debt advice industry and is something that at MRA Debt Help we feel very strongly about.  With a strong background in financial services, we are used to providing regulated advice, and would strongly advocate the regulating of the industry to rid it of misleading information like this.  

MRA Debt Help beleive that every client is different, and will offer you advice based on your individual situation.  To speak to one of our debt counsellors, call 01424 777156

Figures released by the Bank of England this week will be of no surprise to homeowners across the UK.  The worryingly vague figures show that 'somewhere between 7 and 11%' of hoemowners owe more on their mortgage than the value of their home.

Debt management clients will take no comfort from the figures, which paint yet another gloomy picture on the prospect of the UK making a swift recoverey from the current recession.

The Bank stated that 700,000 to 1.1 million homeowners were in negative equity, with around 200,000 buy to let investors facing the same predicament.  It seems that the sharpest house price fall on record has had an unprecedented affect on homeowners. 

One glimmer of hope is that 75% of all mortgaged households owed less than 75% of their homes value.

For advice on all debt matters, call MRA Debt Help on 01424 777156 to speak to one of our debt counsellors.

The Ministry of Justice has released a further warning to debt ridden consumers against phoney debt management companies.  The companies in question claim to be able to wipe clean all of your current credit card debts, based on a loophole in the Consumer Credit Act 1974.

What the companies fail to tell you, is that the loophole was closed by an ammendment to the consumer credit act in 2006.  The few cases that may have been taken out before this loophole was closed may still not be entitled to any money back whatsoever.

Some of these unscrupolous debt management companies are hoodwinking their debt management clients into believing that they could write off their entire debt, when in actual fact this is highly unlikely.  In doing so they are charging extortionate up front fees, placing the clients in even more debt.  Some fees are in excess of £1000.

With some firms claiming between 80-99% success rate, some things are too good to be true, and debt management clients should be wary of such claims.

ID fraud is becoming a more and more prevalent cause of some consumers debt problems.  A new study by home insurers LV= has reavealed figures that are quite worrying!

Up to half a million consumers have been blacklisted as a result of identity theft, and that figure could double by 2014.  With an average fee of £2100 legal fees to clear their name, it seems difficult for consumers not to fall into debt management problems.

John O'Roarke said the last ten years have seen "a massive increase in the number of people targeted by fraudsters".  He added "(this illustrates) the importance of vigilance in protecting personal information and monitoring for any problems that might prove to be a symptom of identity theft".

6000 people took part in the study, of which 27% said they had failed to secure credit due to mistaken identity.  This is bad news for consumers already suffering with debt problems, and could lead to more and more peole seeking the help of debt management companies such as MRA Debt Help.

You may have noticed a lack of this months creditaction statistics.  Well it seems that the latest updates, including Aprils figures, dont appear to have changed that much, leaving me with little to tell you about!

Creditaction do seem to have been busy though, with the release of their latest debt management tool, the 'spendometer'.  Budgeting, as described in many of our debt mangement blogs, is crucial to keeping your head above water when in financial difficulties.

Budgeting can be laborious, and often items get overlooked when you got back home to tot up your days spending.  With the 'spendometer' though, you can simply update your budget on your mobile phone, as and when you spend.  Its available for all WAP enabled phones, so you dont need a flash smartphone to be able to use it (although the new google phone looks like it could be amazing!). 

If you need any debt help, or advice on your budgeting, call MRA Debt Help on 01424 777156 to speak to one of our debt counsellors.