Over the last few months I have been deluged with calls from companies wanting to talk to me about their debt management capabilities. Quite clearly they can see an opportunity that those companies managing mortgage books may have borrowers that need debt management advice. There has been a stark difference in the quality of these companies ranging from established players to those who quite frankly are opportunists. My fear is that some of these companies and individuals are clearly not qualified and are chasing a quick buck or are trying to escape the clutches of regulation.
The way I approach all of these meetings is one of scepticism, what I see in this market is massive reputational risk and significant regulatory risk. In a year or two this will be the next hotbed of bad practice and customer detriment. As I said earlier there has been what appear to be some very well run businesses out there and they no doubt will welcome regulatory reform.
However, I fear for those people who have or will be hood-winked into taking an IVA unnecessarily or entering bankruptcy when there were other options available. Borrowers getting poor advice now on debt management will pay the price for many years to come as their credit status will be destroyed for years to come. Clearly there are issues in the not for profit sector of long waiting times and a general lack of resource. My advice to brokers is to be very careful if you are moving into this sector or are referring borrowers to debt management companies.
