Do the right thing, Adviser's and creditors experience of best practice ...

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Step 3Responses to offers of repayment shouldbe clear and encouragingIf a person’s expenditure falls within, or justifiablyexceeds, objectively established guidelines – suchas the common financial statement trigger figuresmentioned earlier – creditors should accept theiroffer of repayment. To ensure that the person’sdebt actually reduces, charges and interest shouldbe frozen, and creditors should not insist that theperson takes out a consolidation loan. Acceptanceletters should tell the customer how much theyneed to pay, when they need to pay it and howthose payments can be made, such as Capital One’sletters mentioned earlier.Phrases like: ‘your offer is unacceptable to us…but we will accept your payments’ or ‘your offeris declined at this stage’ should be avoided.They are confusing and can lead people to thinkthat their offer has been rejected or that they willreceive preferential treatment if they pay morethan they can afford. Administering repaymentsIdeally, once an offer is accepted, the accountshould be administered by a department that is setup to deal with long term repayment arrangements– such as the Financial Solutions Unit at SantanderCards UK that administers repayments untilaccounts are repaid in full. If external agencies are used, informationshould be passed onSome creditors pass or sell on debts withoutincluding full details of the account or informingthe person in debt or their adviser. When thishappens, the person receives calls and lettersdemanding payment from a new organisation.This can be distressing for the person in debtand is time-consuming for advisers, who haveto reiterate their client’s offer.If external agencies are used to administerrepayment arrangements, or debts are sold,creditors should pass on full details of the client’saccount, any repayment arrangements in place,any advice agencies that are helping the personand any other information that the originalcreditor holds about the person. Any adviceagencies involved should be informed of thenew organisation’s involvement. 14
ReviewsIt is only reasonable that a person in debt shouldbe willing to review their offer. However, askingpeople in debt to review their offer every one,two or three months wastes advisers’ and creditors’time. It is unlikely that the person’s situation willhave improved in such a short time period; andcarrying out a review could involve the adviserre-interviewing the person and sending evenmore letters to their creditors – all of which costsmoney and takes time. Instead creditors shouldonly expect reviews to be carried out annually, orwhen a person’s situation changes for better orworse, as M&S Money does.Creditors should not insist that an advice agencycarries out the review. If a person has maintainedpayments and is willing and able to engage withtheir creditors, they should be allowed to submittheir own revised offer.Furthermore, creditors should not expect theperson’s offer to increase just because time haspassed. Or that they can press for higher paymentsif the person is no longer represented by an adviceagency. Instead creditors should approach reviewsin a pragmatic way: if the person needs extra help,they should be given time to seek it; if the personis able to submit their own offer, they should beallowed to do so. No matter who submits therevised offer, creditors should still use an objectiveway of assessing how much the person can pay –like the CFS. Library photos posed by models: John Birdsall/Press Association15
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Page 7 and 8: The right organisational culturethi
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Page 11 and 12: Targets and incentives areimportant
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Page 19 and 20: Once an arrangement hasbeen set up,
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Page 27 and 28: Do you want to be partof the conver

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