|    FM Home   |    FM News   |    FM Forum   |    FM Blog   |    23rd of February 2018
|   Banking  |   Insurance  |   Property  |   Mortgages  |   Economy  |   Investments  |   Credit Cards  |   Debt  |   Loans  |   Pensions  |   Companies  |  

All Financial News feed All Financial News

Debt management firms play on money fears

Bookmark and Share

by David Masters
Debt management firms play on money fears

Consumers struggling to manage their debts risk falling prey to expensive debt management companies, moneysupermarket.com warned this week.

Research by the price comparison site found that 20,000 people are signing up to debt management plans every week in an effort to get their finances under control.

Many are using free services such as the Citizen’s Advice Bureau and the Consumer Credit Counselling Service (CCCS), although long waiting times with these services mean a small number are turning to paid-for help.

“Being in debt and watching red letters fall through your letter box can be an extremely stressful experience, and many people find that hiring a debt management company to negotiate with their creditors for them can bring a real sense of relief,” said Tim Moss, head of loans and debt at moneysupermarket.com.

Moss added: “It can be extremely hard to differentiate between debt management companies as they are not compelled to publish their fee structures or standard practices.

“We have heard of horrific cases where consumers have paid lots of money to the debt manager before they have cleared a single penny of debt.”

CCCS echoed moneysupermarket.com’s warning.

“It is a myth that fee charging debt management companies provide a faster service than the free debt counselling and support that debt charities such as the CCCS provide,” said Delroy Corinaldi, CCCS director of external affairs.

“We have seen a rise in demand for our services over the past few years and have deliberately increased our capacity to meet this demand.

“Ultimately it comes down to the question – why pay for something that you can get for free?”

Discuss this in the Finance Markets forums

Story link: Debt management firms play on money fears

News posted: February 5, 2010

Financial Services:

Related financial stories to: Debt management firms play on money fears:
Previous: «
Next: »

Visited 2599 times, 1 so far today

No Comments

No comments yet.

RSS feed for comments on this post.

Sorry, the comment form is closed at this time.

Tags: , , ,