Before I rant, I'd just like to point out that I love statistics, especially those that can be used to help debt management clients, or to help our debt counsellors point their expertise in the right direction.  With this in mind, I find it hard to see the point of a recent debt management news story, carried by both The Times and The Telegraph. 

Both publications have released figures showing the numbers of personal insolvencies across the country.  Both papers have taken the line that seaside towns are more affected by the recession than inland towns, due to the higher numbers of Insolvencies per 10,000 population in the majority of seaside towns.

I don't disagree with the findings of the report or the manner in which the figures were collected, but on inspection of said statistics I was perplexed at how newsworthy the figures were!

The highest number of personal insolvencies per 10,000 population could be found in Hull, at 26.6.  This was slightly higher than the national average (15.7).  If these debt management figures were percentages then there would be a considerable difference, but they're not.  This is per 10,000 population i.e. 0.262% and 0.157% respectively. 

If the worst town in the country has an insolvency rate of 0.105 percentage points higher than the national average, then there is surely very little difference nationally.  If either paper had run stories explaining that insolvency rates are extremely simlar across the country then I would be more inclined to agree!

An Administration Order is a county court order: Are you stuck up with multiple credit debts and cannot manage your finances? You can surely resort to an Administration Order in UK. An Administration Order is a court order that allows you to make one single payment every month in order to pay off your arrears. An Administration Order includes credit debts and certain other debts. Since this a county court order, the court will get in touch with your creditors on your behalf and divide the money amongst them on a pro-rata basis. You will have to pay 10% of your payment as a handling fee to the court. This is deducted directly from the payments you make. Once an administration order is executed, your creditors cannot take any legal action against you. With an administration order, all the interest charges that were being added to your debts will be frozen.

Application for an Administration Order: For applying for an Administration Order in UK, you need to have debt amount less than £5000 and at least one High Court or county court judgment against you. At first you need to apply for an Administration Order. For this you will have to fill up a N92 form. You will get this form at any nearby local county court office. This form comes along with a number of tips that will help you to fill up this form. This form will contain detailed information about your debts and remember that the debt amount should not exceed £5,000. An administration order is approved by the court only to individuals. If you share your finances with someone, in that case you will have to apply for the order separately. For employed individuals, an Attachment of Earnings Order will be made. While you start filling up this form, at first you need to put the name of your local county court on the form. The N92 form is divided into four parts: Part A, B, C and D. In Part A, you will have to fill up details such as your family history, employment and financial status. This part is more like your personal budget sheet and you can refer to ‘statement of means’ for filling up this space. Here you will need to give information about your weekly or monthly outgoings as well. After this comes Part B of the form. Here you need to list all your debts such as priority debts, total credit debts and others. It is essential to mention the account number and the creditors address. This will help the court to reach out to your creditors easily in order to make your repayments. After this in Part C you will have to mention how much you can pay off every month to pay off your arrears. Often debtors are confused regarding the amount to be paid off each month. In that case you can always ask for the assistance of the court staff. At last when it is time for you to fill up Part D, make sure that you sign this in the presence of a court officer to prove that the information in the form is true to your knowledge. Part D is the declaration stage. As a tip, remember to keep a copy of the form.

What to do after applying for an Administration Order? Once you have finished filling up this form, you need to submit it for approval by the court. If it is accepted by the court, they will be informing your creditors regarding your administration order. Creditors will be given a time period of 16 days to respond negatively or positively. In case no objections are raised by the creditors, the court grants the order and accepts your offer of payments. After the order is granted, you will be free from creditor attacks. But it can be that your creditors raise an objection to the Administration Order. Then the court will arrange for a hearing and the district judge takes the final decision. Both you and your creditors will have to attend the hearing. At times creditors sent their representatives for attending the hearing. Both the parties get a chance to explain their case, and once the problems are then resolved, the district judge will make the order. Once the judgment goes in your favor, you will start making payments to clear all your debts. An Administration Order means no more creditor calls or letters and no more payments on multiple debts. Now you can surely live a debt free and happy life.

At MRA Debt Help we are constantly receiving queries about peoples credit reports.  It seems that the system is a complete mystery to most people, including debt management clients!

The Times has this week produced a succinct 'top 10' list of some great pointers for people worried about their credit rating, and/or suffering wih debt problems. If you want to view your 'credit rating' then you can contact experian, call credit or equifax who are the top 3 credit reference agencies.  They do  make a small charge to see the report (usually about £3),m but its well worth it to find out what information lenders and banks can find about you. 

The top 10 list from the times -

1. People who have lived in your home before you do not affect your credit rating. The only people that affect your rating are those you have a financial connection with – for example, a joint account or joint mortgage.

2. Registering to vote will improve your credit rating.

3. Checking your credit report will not harm your rating.

4. There is no “credit blacklist”. Many consumers mistakenly believe that lenders hold a database of blacklisted people that will never again be given credit. This is untrue.

5. Paying a mobile phone bill late will damage your credit rating. Always pay all bills on time to keep your record squeaky clean.

6. All applications for credit made in the last 12 months appear on your report – although the report does not detail whether or not the applications were successful. If you have made numerous applications recently, this will damage your record.

7. The size of your credit limit affects your rating. If you have large amounts of credit already available, such as an overdraft and credit cards, you are less likely to be given new credit.

8. Getting married or divorced does not affect your credit record. The record only notes financial connections – so if you are divorced but still have a joint account, your credit rating will still be linked to your ex-partner’s.

9. If a credit account is in default, this will stay on your credit record for six years.

10. If you do remove your name from a joint account, you should still tell a credit reference agency you want to "disassociate" yourself from that person.