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Below are some of the most Frequently Asked Questions we encounter. Click the link that’s most relevant to your needs.

  • How long does it take to set up?
    You decide the pace and timescale for getting the right solution in place. Instead of quickly jumping into a long-term commitment, we’d recommend you think about it and feel sure about the next step. Equally, if you want an immediate solution, we can move very quickly.
    Check out our debt solutions here.
  • What are the repayments?
    Each case is unique, so the answer to this one totally depends on your personal circumstances and what you can afford. Your circumstances and budget go into a set formula provided by the Government, called the Common Financial Statement. It calculates how much you should pay every month. This formula ensures that what you’re asked to pay is fair, and makes sure that your creditor will accept the proposal.
  • What if I am self employed?
    Don’t worry – you’re still eligible for a debt solution if you are self-employed. All the normal requirements still apply, you just need to be able to prove your income. All this takes is, usually, 6 months’ of your trading business accounts.
  • How long will it take for me to get free of debt?
    Don’t worry – you’re still eligible for a debt solution if you are self-employed. All the normal requirements still apply, you just need to be able to prove your income. All this takes is, usually, 6 months’ of your trading business accounts.
  • Are my house and my car safe or will I lose them?
    Most debt solutions will let you keep the things you own (your assets). Some options may require you to give up some or all of your assets, such as bankruptcy and sequestration. We’ll help you find the right way ahead and explain all of these areas.
  • Will my credit rating be affected?
    If you’re already struggling with your repayments, this will be showing up on your credit file and credit rating. A debt solution will also show on your credit file, but as soon as you’ve completed your plan you’ll be free to rebuild your credit rating. You can ask organisations like Equifax and Experian to see a copy of your file – you can do this online or give them a call.
  • What happens after I finish paying the debt?
    After the agreed period is over and you’ve made all your repayments, you will be legally debt free, helping you to restart your financial future. You will be formally discharged from your debts and you’ll get a certificate of completion to prove this.
  • What will I say to my creditors if they get in touch with me?
    After the agreed period is over and you’ve made all your repayments, you will be legally debt free, helping you to restart your financial future. You will be formally discharged from your debts and you’ll get a certificate of completion to prove this.
  • I’m a homeowner – can I still get a debt solution?
    Yes, whether you own your own home, rent a room or flat or live with your parents, or stay at a local authority property. We’ll help you protect your home – using one of our debt solutions is a safer way to get debt free.
  • Can you help with payday loans?
    Yes, payday loans can be accepted into our debt solutions. In fact, with their typically very high-interest rates, taking away payday loans is one of the biggest ways our debt solutions take the pressure off.
  • What is the difference between secured and unsecured debt?
    A secured debt is linked to one of the things you own (an asset) like your car or home, while unsecured debt isn’t.
  • Why would my lenders accept less than I owe them?
    With some debt solution, your creditors may agree to settle for less than you actually owe them. They do this because it’s better than nothing, which could happen if you were able to walk completely away via bankruptcy or sequestration (but don’t forget, these options could also mean you losing your home).
  • What if I’m already enrolled in a debt plan with another company?
    That’s fine. If you’re already signed up with another debt plan that isn’t working well for you, you’re free to switch to a new debt solution any time. But there may be some consequences, like interest being re-added, and exposing yourself to contact from creditors during the switching process.
  • Can I cancel my payments to my creditors?
    No, please continue paying even a minimal amount if you can afford to. Even paying £1 to each will help. That way, your creditors will put less pressure on you, as they can see you’re committed to starting a debt solution that will help sort things out.
  • Should I open a new bank account?
    It depends. If one of your debtors is your bank where your current account is, you’ll need to open a new bank account with a different bank. We can help. It also makes sense to have a fresh start with a new bank plus a watertight debt solution in place that will sort everything out.



We can help and advise with a wide range of debt related issues. Browse the section below and see how we can be of service.

Store Cards & Catalogue Debts


Gas, Electric & Water Debts


Rent Arrears (From A Previous Address)


Disconnected mobile phone bill


Some items bought on finance

Provided not secured or with Perfect Homes, Brighthouse or Crazy George

Car Finance

Only if you no longer have the car

Benefits and DWP overpayments


Loans with a Guarantor

Only when guarantor agrees to go on the plan.

Payday Loans


Mortgage or secured loan shortfalls

Only if the client no longer has any property.

Items Bought On Finance

If you fail to make hire purchase or secured loan payments, for example on a car, then the finance company are likely to repossess it. An allowance will, therefore, be made for these payments to be maintained in your IVA or Financial Management Plan. In some cases, it may be impractical to return items bought on credit.

Council Tax Arrears

The current year’s council tax liability is included in your income and expenditure statement as an essential outgoing, as are any catch-up payments for that year you have agreed with your local council. Arrears for a previous year can be included. The exception to this is when bailiffs have already gained access to your home.

Debts Subject To A CCJ

In the case of a financial management plan, after your ability to repay your unsecured debts has been determined, any debts already subject to a CCJ are paid in full as per the terms of the CCJ before payments to other creditors are considered. Debts subject to an IVA are never the less still unsecured and can still be included in an IVA.

Shortfalls On Repossessed Items

If your home or other assets have been repossessed and sold there may remain a shortfall for which you remain liable. Such debts are unsecured and can be included in an IVA or Management Plan.



The world of debt repayment can be a confusing place. Our handy A to Z guide below will give you clear and simple explanations of any legal terms you might come across.

Administration Order

An Administrative Order may apply if at least one County Court Judgement (CCJ) has been issued against you and your total debts do not amount to more than £5,000. An Administrative Order allows a County Court to administer the payments you make to your creditors. You make one payment to the court, and then the court distributed your payment among all your creditors based on how much you owe to each creditor. The good news is that while an Administration Order is in force, your creditors cannot hassle you or attempt to take any further action. On top of this, the interest on the amount you owe is stopped. This interest freeze means that the value of your debt will only decrease and cannot grow.


Arrears are to the debt that amasses when you miss bill payments. Arrears on your rent, mortgage, council tax or household bills have significant financial consequences and so must be settled at once. Your arrears will rise if you don’t keep on top of your payments on any unsecured debts and, with applied interest, will mount up the more instalments you miss. You will have to pay more than your regular monthly payments until you have cleared your debt and are back up to date.


Assets are items you own which have monetary value. These include the likes of property, vehicles, stocks, shares, antiques, savings etc.


Assignment means the sale or transfer of an agreement or contract from one company to another.

Assignment Notice

An Assignment Notice informs you when a debt is sold to another company. Under UK law the new company must provide you with an Assignment Notice, so you are aware of who you are now dealing with and how to get in contact with them.

Attachment of Earnings

An Attachment of Earnings is an order issued by a court stating that your debt repayments are to be taken directly from your wages before you receive them. This can occur if you don’t follow the repayment guidelines set out by a County Court Judgement as creditors can request that the court enforce your debt payments being deducted from your wages at source. The court decides what a reasonable monthly amount is. For debts relating to Council Tax debts, there is a similar process with the Magistrates’ Court.

Attachment of Benefits

Similar to an Attachment of Earnings, if you don’t make the repayments detailed by a County Court Judgement, then the council can reduce your benefit payments. The reduction is at a rate of 5% of the personal allowance for an individual claimant aged 25 or older. This benefit reduction continues until the debt paid in full.


Bailiffs are individuals hired, mostly by courts, to enter your home and remove things to be sold at auction to raise funds to put towards your debt. Bailiffs usually the last resort, applied when the terms of a CCJ have are not met.

Balloon Payment

A Balloon Payment is a lump sum, larger than the regular monthly payment, on a conditional sale or hire purchase agreement. This usually applies after you have made some smaller monthly payments.


Banks are institutions that lend money to people and businesses.


Bankruptcy is a legal process which, with a few possible exceptions, writes off all your debts. You, other your creditors, may request that a court declare you bankrupt. Debts are usually written off after two or three years, however, if there’s equity in your home or other assets, these will usually be sold to help pay off your debts. If you own your own home then being declared bankrupts could result in you being made homeless.

Bankruptcy Order

A Bankruptcy Order is the name of the court order that makes you bankrupt.

Bankruptcy Petition

A Bankruptcy Petition is the formal document provided by a creditor to a court to request (petition) for a Bankruptcy Order.

CCA 1974

CCA 1974 is short for the Consumer Credit Act 1974. It is the act of parliament that regulates credit in England and Wales. There are also several other regulations (mostly published in 1983) as well as the CCA 2006 which is also relevant.

CCA 2006

The Consumer Credit Act 2006. It has since been amended to the CCA 1974.

Charging Order

A Charging Order is when a court places an order on a property. This order dictates that when the property is sold, the initial part of the profit is used to pay off an existing debt. It’s essentially like converting an unsecured loan into a secured loan. When a Charging Order is issued, it is noted in the property deeds. Charging Orders are allowed under the Charging Orders Act 1979 when a creditor has a high court or county court judgement, but an individual has defaulted on the payments.

Charge for Payment

Served in Scotland, this document is issued when an individual has been ordered to settle an outstanding debt within a set timescale. It’s similar to a CCJ (County Court Judgement) in England or Wales.


Credit simply means the lending of money.

Credit Agreement

An agreement/contract between a creditor and debtor to lend money.

Credit Card

A card provided by a lender such as Visa or Mastercard which allows you to spend however you like, up to a preset credit limit and pay off in full at the end of the month or make monthly payments including interest until the debt is paid off.


A person or organisation (usually a bank or other financial institution) which lends money to an individual. If you fall behind with your payments for a service provided or product purchased then your creditor is the supplier of this product or service as they have effectively let you borrow money from them.


CRA is the acronym for the Credit Reference Agency. They are one of many companies who keep a historical record of payment made.

Credit Record

A Credit Record is the name for the information held about debtors by Credit Reference Agencies.

Credit File

A Credit File is a document detailing an individual’s financial history and which is held by authorised companies. This file contains information about when you have applied for credit and a record of any credit you have received in recent years.

County Court Judgement

A CCJ is a final judgement from a court about an individual making payments for a debt owed. CCJs are issued if you fail to keep to the original agreement with the lender and have not tried to agree on how to repay the debt. This is why making efforts to sort things out with your debtor first is vital.

Contractual Payments

Contractual Payments are the monthly payments agreed when you take out a credit agreement with an organisation. By failing to make your contractual payments, arrears can accumulate which can, in turn, affect your credit rating.

Company Voluntary Agreement

Similar to an Individual Voluntary Agreement (IVA) but for companies. A CVA gets your creditor’s agreement on the way to tackle the debt so that your business can carry on trading.

Certificate of Satisfaction

Essentially a receipt provided by a court proving that an individual has paid a CCJ or Attachment of Earnings. You will have to pay a £10 fee to receive one.

Data Controller

The individual nominated by a company to look after people’s personal data. In compliance with the Data Protection Act 1998, every firm must have a data controller.

Debit Card

A card provided by your bank or building society which allows you to withdraw money, direct from your account, from a cashpoint. As you draw only money you already have from your current account, you are not borrowing anything, and so debit cards are not regulated by the CCA 1974.


The name for any money you have borrowed.


DCA stands for Debt Collection Agency. The organisations collect defaulted debts. DCAs can either work for a creditor or have debts ‘assigned’ to them, making them the new creditor.


A Debtor is the name given to any person who owes money.


Default is used to signify debt which isn’t healthy due to repayments having being missed.

Default Notice

A legal process which must occur (according to s87 of the CCA1974) before a creditor can take certain actions to enforce a previously agreed credit agreement.


Standing for Debt Management Plan, a DMP is a plan agreed with creditors to pay off an outstanding debt by arranging more affordable instalments.

Earnings Arrestment

The Scottish alternative to an Attachment of Earnings Order. A court can take money direct from your wages to service a debt.


The difference between the value of your mortgage and that of your home’s value in the current housing market. Negative Equity can occur when the loans taken out on a property exceed the market value of a property.

Ex Parte

A term which describes the situation when one person instigates legal action without informing the other party.

Final Discharge

Once you have declared yourself bankrupt and are at the point where you are free from debt, this document is posted to prove the end of your bankruptcy has been reached and prove you are debt free.


Fraud is when an individual deliberately misleads another person or organisation with information they know not to be true. It is normally done to falsely gain financial advantage.


A Guarantor is a person willing to guarantee on your behalf that repayments of money borrowed will be repaid. If the person borrowing the money is not suitable for lending by themselves, a third party can offer to be Guarantor and are liable for the repayments should you be unable to make the repayments for any reason.


A Guarantee is an agreement made by one person to pay a creditor on behalf of another, should tey be unable to meet the required repayments.


The act of systematic and/or continued unwanted and annoying actions of one party or a group, including threats and demands. The Protection From Harassment Act 1997 dictates that causing distress by harassment is a criminal offe


An agreement formed between two parties (usually an individual and a company) where one party supplies or leases an item from the other and, at the end of the lease agreement, ownership of the item passes from the organisation to the individual.

Hire-Purchase Agreement

The name of the agreement required to undertake a hire purchase. It is regulated by the Consumer Credit Act 1974.

Income Payments Order

During the process of bankruptcy, if officials (usually the Official Receiver or Trustee) believe the debtor can afford to make regular payments towards the debt, they can apply for an Income Payments Order to recoup money which is then shared amongst the creditors.

Informal Arrangement

The arrangement of reduced payments to your creditors without enlisting the help of an official third party.


The situations that occur when an individual does not possess the funds to meet debt payments as and when they are due.

Insolvency Practitioner

An insolvency specialist recognised by the appropriate regulatory body. These individuals are qualified to deal with your insolvency and take steps on your behalf to sort out your debts.


Interest, in debt terms, is a percentage of the loan amount paid to a creditor as payment for the loan. These rates can vary wildly between different types of lenders. High interest rates can contribute to a repayment becoming unaffordable.

IVA (Individual Voluntary Arrangement)

An IVA is a formal arrangement reached with your creditors. An IVA normally lasts 5 years, during which time you make affordable monthly payments, and the remainder of the debt is written off. Providing you make all your payments. All interest and charges are stopped once the agreement ends. An IVA is a private and legally binding agreement for people with larger debts.

Joint and Several Liability

Joint and Several Liability is all about shared responsibility. If you and your partner take out a credit agreement (loan, overdraft etc.) with an organisation in the names of you and your partner, then you are both liable for the full value of the debt. If either person fails to repay the debt, a situation not uncommon following separation or divorce, the creditor will ask the other person for payment of the outstanding amount in full. Two aspects of this which are useful to remember are:

1) If this occurs the person not defaulting on the debt is still responsible for repaying the debt in full and not just ‘their half’.

2) Credit card debts are not included in this as, even when there are two cards, usually only one person is the account holder.


An individual or company who lends you money. Usually, a bank, building society or credit card company.


A term used when a bailiff receives payment from a debtor or takes goods to sell to raise money towards the cost of the warrant and other associated costs. The company sending the bailiff must inform you how much levy will be charged seven days before the bailiffs arrive at your property.

Liabilities Orders

If your council tax is not paid, you’ll receive a liability order 28 days after the payment was due. A liability order is issued to allow a council to collect arrears directly from your wages. This means your take-home pay will be reduced during this repayment period.


If a business entered administration, there is a winding up of affairs. All company assets (property, equipment etc.) are sold off to raise funds with which to pay the creditors. If money remains at the end of this process, it is shared among the shareholders.

Letter Before Action or Letter of Claim

To begin the process of litigation (in accordance with the Preaction Protocols Practice), you must be sent one of these letters. The letter explains the complaint against you and gives you 28 days to reply asking for further information or attempt to resolve the issue.

Notice of Assignment

A Notice of Assignment informs you when a debt is sold to another company. Under UK law the new company must provide you with an Assignment Notice, so you are aware of who you are now dealing with and how to get in contact with them.

Official Receiver

If you declare yourself bankrupt, the Official Receiver is the person who will handle the administration for you. They will interview you and decide whether any of your possessions (assets) should be sold to help resolve things with your creditors.


If you declare yourself bankrupt, the Official Receiver is the person who will handle the administration for you. They will interview you and decide whether any of your possessions (assets) should be sold to help resolve things with your creditors.

Property Restriction

A creditor, during an IVA (Individual Voluntary Arrangement), a restriction may be placed on your property. This will only be in place during the time of the arrangement and will not stop you selling your home, but it does mean you could lose equity if the value is greater than the value of your debt.

Proof of Debt Form

When you and your creditors reach an agreement using an IVA or Trust Deed, or if you go bankrupt, your creditor can utilise a Proof of Debt Form to illustrate the debt and stake their claim for money. See also Assignment Notice.


Doing something ‘by proxy’ means that you have somebody else do it on your behalf. In creditors’ meetings, it is normal for them to send a proxy to vote for them.

Right to Offset

If you have fallen behind on your payment for a loan or credit card but also hold a current account with the institution, they can opt to use the ‘Right to Offset’. This means that without asking your permission first, they can remove funds from your current account to bring your debt repayments up to date. The same situation applies with an overdraft and savings with the same provider.

TCC or Total Cost of Credit

When borrowing money, the TCC is the total sum of all the arrangement fees and interest added to your loan.

Time Orders

Time Orders are useful if you are trying to sort out your debts and your creditor refuses to freeze your interest costs or help you reduce your payments to a more manageable amount. Time Orders allow the court to alter tour credit agreement to help find a way forward suitable for both parties.

Token Payments

If you cannot afford to make your usual repayments, it helps if you can continue to make smaller ‘token’ payments each month. It could be as low an amount as £1, but it is far better to send this ‘token payment’ than nothing at all. Even a small payment helps shoe your commitment to sorting out the situation.

Transactions at an Undervalue

This refers to a complicated situation that can occur during bankruptcy. On some occasions, before going bankrupt, an individual attempts to do something they shouldn’t. This action usually takes the form of attempting to transfer a valuable asset (car, property etc.) into a friend or family member’s name. This is done in the hope that the asset will be viewed as separate from the estate being dealt with by the bankruptcy.

The Trustee or Official Receiver can scrutinise the finances of the debtor for up to 10 years before bankruptcy to assess whether this has occurred.

For example, an individual in debt may undersell their home to a friend for £1 and then follows this up by declaring bankruptcy a few years later, in the hope of regaining the property once the bankruptcy is discharged. In this set of circumstances, the Trustee or Official Receiver can apply to have the property in question sold and any profit used to go towards settling the debt.


During bankruptcy or while setting up an IVA, a Trustee can be either the Insolvency Practitioner or Official Receiver. A Trustee will control the assets involved.

Unsecured Loan / Debt

Any loan undertaken with no security. This means it is not connected to any of your assets, unlike a secured loan.

Variation Order

Variation Orders can be useful if a CCJ has been instigated but, due to changing circumstances, the debtor is unable to afford the payments. You may apply to alter the payments using an N245 form.

Warrant of Execution

If you have a CCJ against you but haven’t made payments and have not applied to adjust your payment amounts using a variation order, a warrant of execution may be issued. This means bailiffs can go to your property and remove goods to the value of the debt you owe.


These are any assets (money, property or items) that you receive during the time you have an IVA or are bankrupt. These assets will go towards repaying your debt and will result in you becoming debt free more quickly.



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Richmond Oaks Insolvency
Richmond Oaks Insolvency



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