Fees and Key information
What are the fees for your solutions?
If you enter into a debt solution there may be fees involved. See below for the level of fees associated to each debt solution.
Will my credit score be affected?
Any debt solution that involves paying less than originally agreed will have an impact on your credit rating in the medium to long term.
What if I change my mind?
If you choose to enter a solution with our chosen FCA regulated debt partner, you have the right to cancel the agreement at any point within the first 14 days. If you do, you will receive a refund of any fees you may already have paid during that time.
Debt Management Plan fees
A management fee will be charged of 18.5% of your regular payment to the Debt Management Plan (DMP) (this could be every four weeks or monthly depending what suits you best and when you receive your regular income), and is subject to a minimum of £38.50 and a maximum of £90. This fee covers the month-to-month running of your DMP, including negotiating with your lenders, distributing payments and taking care of correspondence between you and your lenders.
This fee also covers regular reviews of your circumstances - normally once every 12 months (or any other time your circumstances change). If your situation has changed and your ability to keep up with your debt management plan is affected, your lender will be contacted about changing your payments accordingly.
|For example if you owe £13,742 to your unsecured lenders and can afford regular monthly payments of £237 to the DMP, here's what you can expect to pay.|
Minimum estimated repayment term
This assumes that regular payments are maintained without default, and that the lenders agree to freeze interest and charges. This is not guaranteed and, if they don't, it will take longer to clear the balance in full.
|Total fees payable over the full term of the DMP||£3,157.20|
|Total amount to be repaid including the original debts||£16,899.20|
Individual Voluntary Arrangement fees
You will only be charge a fee if your Individual Voluntary Arrangement (IVA) is proposed and accepted by your lenders. All fees are paid out of – not in addition to - your regular affordable monthly payments.
Once your IVA has been accepted, the fees you pay will be:
- A nominee's fee
- Supervisor's fees
This fee covers the debt solution providers professional costs and charges for arranging your IVA including:
- Preparing your IVA proposal - which sets out the proposed terms of your IVA and provides your lenders with a detailed snapshot of your finances
- Organising the creditors' meeting, in which lenders can request changes to the terms of your IVA
It will typically be between £1000 and £3000 and is often capped to an amount equal to your first 4-6 months' IVA payments.
The Nominee's fee will be paid first before any payments are made to your lenders.
The Supervisor's fees cover the ongoing work involved in running your IVA and is calculated as a percentage of “realisations”: typically it is charged at 15–18% of any money received by the Supervisor and distributed to your lenders, such as your monthly contributions, any assets (e.g. the equity in your property, successful PPI mis-selling claims) and windfalls (e.g. an inheritance) that you receive during the term of your IVA.
The debt solution provider are also entitled to claim back the cost of certain expenses (such as postage, insurance, etc) incurred directly in connection with the running of your IVA.
The amount of the fees will be clearly set out your IVA Proposal. They must be approved, and may be changed before it is accepted, by your lenders.
|These are the average fees currently paid by our clients.|
Trust Deed fees
You will only be charged a fee if your Trust Deed becomes “protected”, i.e. it is accepted by your lenders. All fees are paid out of – not in addition to - your regular affordable monthly payments.
Once your Trust Deed becomes protected, the fees you will pay are:
- A fixed fee
- A percentage of realisations
This fee covers the Trustee's professional charges for arranging your Trust Deed including preparing your Trust Deed and presenting it to your lenders for protection.
The fixed fee will not normally exceed £2, 500 and will always be the first cost that is paid out your regular contributions, and before any payments are made to your lenders.
The Realisation Fees cover the ongoing work involved in running your Trust Deed and is calculated as a percentage of “realisations”: typically 15-20% of any monies received by the Trustee and distributed to your lenders such as your regular payments, any assets (e.g. the equity in your property, successful PPI mis-selling claims) and windfalls (e.g. an inheritance) that you receive during the term of your IVA.
The Trustee is also entitled to claim back the cost of certain expenses (such as postage, insurance, etc) incurred in connection with the running of your Trust Deed.
Exactly how much you will be charged will be included within the terms of the Trust Deed you sign before your lenders approval is sought.
|Here's a breakdown of the fees for a typical client who owes £25,363.59 to unsecured lenders and can afford regular monthly payments of £149.19 into a Trust Deed lasting four years.|
|Percentage of realisations||£1,464|
|Trustee costs and disbursements||£830|
|Typical monthly repayments (x48 months)||£149|
Total to be paid (including fees mentioned above)
This example assumes that there is no equity in any property owned by our client, that they do not receive any regular overtime or bonus payments.
|Unsecured debt written off on completion||£21,024 (83%)|
Debt Arrangement Scheme fees
If you enter into a Debt Arrangement Scheme (DAS) Debt Payment Programme through our chosen debt provider, you will pay an Initial fee (equal to your agreed regular payment (up to a maximum of £475) and an ongoing management fee calculated at 15% of each of your regular payments, subject to a minimum of £32.50 and a maximum of £85. Your regular payment can be paid weekly, fortnightly or every four weeks or monthly depending on what suits you best and when you receive your regular income.
The initial fee will be used to cover the work that's involved in setting up your Debt Payment Programme (DPP), including preparing your application and presenting your DPP for the approval of your lenders.
None of the first payment you make will go towards your debts, and this means you will go further into arrears. But don't worry – as long as your DPP is accepted, you'll be reducing your balance again as soon as you have made this initial payment.
Your monthly fees pay for the work that's involved in the day to day running of your DAS DPP, including dealing with any issues or problems that may arise.
You'll have regular reviews of your circumstances at least every 12 months, sooner if you get in contact about a change of circumstances, to help ensure your DPP is on track and remains the best solution for repaying your debts. If at any point your circumstances change significantly, you should contact your debt solution provider as they can help by asking your lenders to agree to vary your monthly payment accordingly or, if necessary, help you to find a more appropriate debt solution for your needs.
|Here's what a typical DAS client who owes £11,858.99 to their unsecured lenders and can afford regular monthly payments of £237.44 to the DPP can expect to pay.|
|Initial fee (Initial monthly payment)||£237.44|
Estimated repayment term, including the initial payment
This assumes that regular payments are maintained without default, interest and charges will be frozen if the DPP is accepted
|Total fees payable over the full term of DPP||£2,339.02|
|Total amount to be paid including the original debts||£14,198.01|
Bankruptcy / Sequestration fees
England and Wales
The administration fee to apply for Bankruptcy in England and Wales is £680, which is payable to the Insolvency Service via gov.uk. To apply for bankruptcy you will need to complete an online application and submit this to the Insolvency Service where an adjudicator will then consider your application.
You will need to apply to the High Court for your Bankruptcy and your local Citizens Advice Bureau can assist you with this process.
There are three fees that you will need to pay when you take your petition to the Court:
- A fee of £525 towards the costs of administering your bankruptcy
- The Court fee of £115 (this fee may be waived in some circumstances, the court staff will be able to advise you)
- A fee payable to a solicitor relating to the Statement of Affairs which costs approximately £7.
Application fee for Sequestration
The application fee for Sequestration in Scotland is £200 or £90 for MAP and there are no waivers or exemptions to this fee. During your Sequestration the Trustee will charge fees for their professional costs, (usually on an hourly/time and costs basis). These fees will be taken from any contributions, after which, the remaining sum (if any) will be distributed to your lenders.
The Accountant in Bankruptcy determine the level of fee's that can be charged, based on the time spent working on the case. For example the average fees taken by our chosen debt solution provider based on sequestration cases that were completed in 2014 was £5175. Please note this was also based on a term of 3 years. This will increase to four years from April 1st 2015. A fee is only payable when you have been assessed as being able to make a regular contribution towards your sequestration.
Debt Relief Order fees
You can only apply for a Debt Relief Order (DRO) through an approved intermediary. Our chosen debt partners are an approved intermediary and they do not charge for these services.
If you decide to apply for a DRO, you will need to pay a fee an administration fee of £90 to the Insolvency Service when you submit your application.