Man Found Guilty of Fraud

A man was found guilty yesterday of fraud and theft after he stole from his landlord. Michael Wilds stole from Paul Hardiment by using his Barclays bank card and spending more than £10,000.

After an intense investigation it transpires Barclays bank had been sending Mr Hardiment's card to the property he let to Mr Wilds, who in turn committed serious fraud. Over £10,000 had been spend by Michael Wilds before Paul Hardiment became aware his tenant was stealing from him. Barclays sent their statement to Paul at which point he queried the balance.

Mr Wilds from York used the credit card to finance his expensive lifestyle and pay off gas debts. Michael Wilds solicitor, Nicholas Barker, said: “This did not fund any high living”, however, the prosecutor stressed he drove a jaguar and spent the money on new tyres for his girlfriends Audi TT.

Wild pleaded guilty to fraud and theft and received a sentence of up to four months imprisonment, suspended for two years, and ordered to carry out 150 hours unpaid work.

UK Personal Debt Solutions

The latest UK personal debt figures reveal that the average household debt is £55,803 - including mortgages. The results, compiled by Credit Action, show that total UK personal debt at the end of June 2011 came to £1,451 billion.

The monthly data reveals a significant amount of debt across the UK, with individuals currently owing almost the country’s entire output between Q2 2010 and Q1 2011.

Every day an average of 331 people are declared bankrupt or insolvent, according to the report. In addition, the Citizens Advice Bureau deals with 9,072 new problems daily, whilst every 4.36 minutes a new consumer is declared bankrupt or insolvent.

The insolvency solutions exclude informal debt solutions such as a debt management plan, so the debt situation is far worse than previously expected. Personal debt problems can range from general money advice through to Bankruptcy advice. 

The Office for Budget Responsibility (OBR) has predicted that household debt will reach £2,126 billion by the end of 2015, increasing the average debt per household to £81,769, Credit Action reveals.

Furthermore, the UK population is projected to grow by 1,205 people a day over the next decade which is likely to further impact the debt industry. Average consumer borrowing via overdrafts, credit cards, motor and retail finance deals and unsecured personal loans has increased to £4,268 per UK adult at the end of June 2011.

"Robbing Peter to Pay Paul"

There are millions of people across the UK who have debt, however that debt is manageable and whilst we might begrudge paying the interest each month we know it's possible to repay our debt eventually.

Some people become entrenched in debt, struggling to find the solutions to resolve long term financial problems, often resulting from another issues such as a marital breakdown or loss of job. When the difficult financial times come, it's easy to understand why people would want to resolve the problems themselves - using their own initiative to move credit card balances to get the best deal, avoid paying high interest and charges and ultimately pay off their debt.

The difficulty for many people arises when there is no longer any credit card available, no loan or further credit on offer. When financial times get tough, it's important to accept that in some instances qualified debt experts could be required - not another loan!

When debt problems are coming through the letter box or via the telephone;

- Face it head on
- Stop looking for a loan
- Ask for debt advice from a qualified debt advisor at a charity, such as Debt Support Trust or Citizens Advice Bureau

Introduction To Trust Deeds

A large number of people in Scotland are entering the Protected Trust Deed debt solution. This is known as the IVA in England, Wales and Northern Ireland. Last years almost 8,000 people entered a Protected Trust Deed to resolve their debt problems. In this article we'll explain who is suitable for a Trust Deed and who would not meet the criteria

What is the criteria?

You must;

- Be able to repay at least 10% of the money you borrowed over a 3 year period

- Owe at least £10,000 unsecured debt

- Be able to pay £150 towards your debt each month

An example of a Trust Deed

Steven from Glasgow is 30 and married to his wife Karen. Steven has 5 debts (2 credit cards, 2 store cards and an overdraft with his bank) which totals £30,000. Karen has an overdraft totalling £1,500. Steven and Karen has a mortgage which has £100,000 outstanding. The value of the house is roughly 100,000 - there is no equity in their house.

Steven works full time and earns £1,300 each month after tax. The monthly expenditure for Steven is £1,000. So, Steven has £300 disposable income available to pay his debts each month.

The problem is that Steven's monthly contributions to his debts are £800. As a result, Steven is having to borrow money from other credit cards to meet his money payments. A debt management plan is one solution for Steven. If he managed to freeze his interest and charges he could have his debt repaid in just over 8 years. There is also a solution called a debt arrangement scheme (Scotland only) where he could enter a legally binding debt management plan type solution.

Steven would also be applicable for a trust deed as well as sequestration. The Trust Deed would see Steven repay an estimated 30% of the debt he borrowed over a three year period. If he completed the solution he would see his interest and charges, along with the rest of the money he owed, being cleared. Sequestration would also be an option for Steven, with Steven being discharged after one year from the Sequestration. As Steven has available money he would be asked to make a contribution towards his debt for a total of three years.

All debt solutions will negatively effect Steven's credit rating.

When would the Trust Deed not be applicable

Steven would not be suitable for the Trust Deed or Sequestration if the equity in his house was more than his debt. Karen would be entitled to half of the equity in the house, however if Steven had £50,000 equity in his house, then he would be entitled to half of this (£25,000).

The £25,000 along with 36 monthly payments of £300 towards his debt would see Steven repay more money than the actual debt he had