EuroDebt's Service Fees
We offer all-round debt advice and a full range of Debt Solutions, including Debt Management Plans (DMPs), Individual Voluntary Arrangements (IVAs), Protected Trust Deeds (PTDs), Bankruptcy Assistance and Debt Relief Orders (DROs). Unique to the commercial debt advice sector, all our prospective clients have a face-to-face financial review, typically in your own home, before any debt solutions are recommended. There is no charge for the financial review and debt advice provided with regard to the debt solutions that may be in your best interests. Each of the service pages for the respective debt solutions explains how each solution works, for example, how an IVA works and the role of the Insolvency Practitioner.
Our service is very personalised and offers access to a local licensed debt advisor and a personal case manager or supervisor for managed debt solutions like a DMP or an IVA. Nearly 30% of our clients are facing legal action when they come to us and approximately 15% of our clients have arrears with priority creditors (e.g. Mortgage, rent, council tax, utilities). These are a priority to us and helping you deal with urgent action items is part of the fee we charge, which are set out below.
Where applicable you may be referred to an alternative service provider, for example, a local competent authority if a Debt Relief Order (DRO) is regarded as the best solution for your circumstances. Extreme hardship cases may be referred to their local Citizens Advice Bureau (CAB) as part of our Client Charter in dealing with vulnerable and severe hardship cases.
All fees that are associated with any debt solution that EuroDebt offers are totally transparent and disclosed prior to any contractual agreement being made with you. Your preferences are critical to the debt solution selected and affordability is a key criteria.
Debt Management Plans (DMPs)
The fees that are applicable to a EuroDebt Debt Management Plan are detailed in the table below and the Terms of Business that are associated with our Debt Management Agreement are available by clicking on the leaflet to the right (pdf). All DMP fees are exempt of VAT
| Fee | Description | Amount |
|---|---|---|
| Instruction Fee | The initial fee for EuroDebt to notify your creditors of our appointment, to commence negotiations to freeze interest & charges and stop debt recovery activity. Once accurate balances have been received from your creditors to set-up your Debt Management Plan and finalise your payment arrangement with your creditors using the Common Financial Statement (CFS) | Based upon a fee matrix calculated on the number of creditors we are acting on
and the total debt balance Average Fee £779.98 (March 2011) |
| Monthly Management Fee | Once your Debt Management Plan has been set-up we will deduct a monthly management fee from the disposable income that you pay to us as part of your Single Payment Plan (SPP). The monthly management fee is charged for a maximum of 96 monthly payments after which all of your disposable income is disbursed to your creditors. | Based upon the fee matrix stated above Average Fee: £34.00 Max fee: £90.00 Min fee: £27.50 |
Our average debt level for a client on a DMP is just over £22,231 with 7 creditors.
Clients that would prefer to receive debt advice over the telephone may be referred to our sister company Atlantic Financial Management which specialises in delivering debt advice and Debt Management Services over the telephone. Clients typically using this service have debt levels of just under £15,000 with 5 creditors.
Vulnerable Clients
EuroDebt operates a vulnerable client policy and the local debt advisor has the discretion to waive or reduce the Instruction Fee and/or reduce the Monthly Management Fee to the minimum based upon personal or household circumstances. We waive the Instruction Fee in approximately 10% of all cases where a Debt Management Plan is determined to be the right debt solution.
DMP Switching Policy
Any client of a Debt Management Company that has closed for whatever reason can enter into a Debt Management Programme with EuroDebt free of any Instruction fee.
Individual Voluntary Arrangements (IVA)
For clients in England & Wales or Northern Ireland, where an IVA is agreed to be the best debt solution for you then we will refer you directly to our chosen licensed Insolvency Practitioner, as we do not have an in-house Insolvency Practitioner. We operate a panel of Insolvency Practitioners covering all legal jurisdictions and they are all companies independent of EuroDebt.
Once the Insolvency Practitioner has confirmed that an IVA is in your best interests then we charge an Administration Fee for preparing and collating the information required for your IVA proposal. This is likely to involve another face-to-face meeting and time is normally of the essence. The fee for this service is equivalent to twice your monthly disposable income (plus VAT) and will be invoiced to you. The refund policy is based upon the level of work we have done and is detailed in the IVA Support Agreement you sign at the meeting with the debt advisor.
The Insolvency Practitioner will also charge fees once you approve your IVA proposal and this will consist of a nominee fee and a supervisory fee in their role of Nominee and Supervisor, respectively. For more information on IVAs then click here to access the R3 booklet that should be read by a prospective client before incurring any fees.
Nominee Fee
The nominee fee is a fixed fee and covers the Insolvency Practitioner's work in setting up your IVA proposal to your creditors.
The nominee fee charged by our Insolvency Practitioner is likely to be in the range of £1,000 to £3,000, with an average of £1,700 (plus VAT).
The Insolvency Practitioner will be paid the nominee fee out of the payments you make into the IVA and these will not be paid to your creditors, so that your credit agreements that are part of the IVA will go into further arrears. The creditors are bound by the IVA proposal once approved provided that you maintain agreed payments to the Insolvency Practitioner.
It takes around 6 - 8 weeks to set up an IVA and during this period you will commence your monthly contributions into your IVA. It is likely that by the time the IVA is approved, you will have made one to two contributions which will be used as part payment of the nominee fee.
Supervisor's Fee
The supervisor's fee covers the on-going administration of the IVA, disbursement of contributions to your creditors and any reviews that are required, including an annual review. The supervisor has reasonable discretion where your circumstances change without going back to your creditors and this may affect the contributions and fees.
The calculation of the supervisor’s costs and fees will depend on the proposal and is therefore subject to your individual circumstances. Wherever possible our Insolvency Practitioner's follows the IVA Protocol, an agreed approach with the major lenders, where the supervisor’s fee will usually be 15% of your monthly or quarterly payment.
For employed or retired people it will be normal for contributions to be made monthly. For the self-employed there may be flexibility in payments to allow for invoice payments by their customers. Your creditors will agree these supervisory fees with the Insolvency Practitioner and they will be deducted from the money you pay the Insolvency Practitioner for distribution to your creditors.
Where you are a homeowner, there may be a requirement to make contributions for a sixth year rather than release equity from your property. A supervisor fee will be applicable on any contributions in the extended term of the IVA.
If your IVA fails
If your IVA fails, meaning your Insolvency Practitioner formally defaults the IVA, then you will remain liable for the balance of your debt and any Insolvency Practitioner fees and costs already incurred.
Protected Trust Deeds (PTD)
For clients in Scotland, where a Protected Trust Deed (PTD) is agreed to be the best debt solution for you then we will refer you directly to our chosen licensed Insolvency Practitioner, who will act as Trustee, as we do not have an in-house Insolvency Practitioner covering Scotland. We operate a panel of Insolvency Practitioners in this legal jurisdiction and they are all companies independent of EuroDebt and are all members of the Insolvency Practitioners Association.
EuroDebt charge no fees for the initial regional advisor meeting and our licensed advisor then acts as an agent to the nominated Insolvency Practitioner, in their capacity as Trustee. Any Fees that we are paid as the agent of the Trustee will be disclosed in the Protected Trust Deed proposal and will be collected from contributions to your Protected Trust Deed. Any work we undertake is auditable by the Insolvency Practitioner and the Scottish Account in Bankruptcy.
The fee the Trustee will charge will depend on your individual circumstances, but the average charge is between £2,500 and £5,000 plus VAT. Your Trustee will be paid before any money is made available to repay your creditors, though your creditors are bound by the Trust Deed once it becomes 'Protected'.
Click for more information on Protected Trust Deeds.
If your PTD fails
If your PTD fails then you will remain liable for the balance of your debt and any Insolvency Practitioner fees and costs already incurred.
Bankruptcy Assistance
For clients in England & Wales, where Bankruptcy is agreed to be the best debt solution for you then we will refer you directly to our chosen licensed Insolvency Practitioner, as we do not have an in-house Insolvency Practitioner. We operate a panel of Insolvency Practitioners covering all legal jurisdictions and they are all companies independent of EuroDebt.
We can offer expert advice on:
- The Bankruptcy Process
- Period of Bankruptcy
- The effects of Bankruptcy
- Bankruptcy Restriction Orders 'BRO', where applicable
We charge a fee of £250 plus VAT for this service, which includes the time of the Insolvency Practitioner and our personnel in preparing the debtors petition paperwork and arranging the court date, including use of the Court Desk if applicable. This fee excludes prevailing court fees and deposits. These are currently:
- The Court Fee of £175
- The Official Receiver's Deposit of £525
You will normally be discharged within 12 months of bankruptcy proceedings being concluded. Click for more information on Bankruptcy.
Debt Relief Orders (DROs)
Where a DRO is agreed to be the best debt solution for you then we will refer you to Competent Authority, usually your local CAB. All Competent Authorities are entirely independent of EuroDebt Finance (UK) Limited. The Competent Authority will explain the fee associated with setting up a DRO, which is currently £90.
As stated above, we charge no fees for our initial debt advice and we do not charge any fees in respect of the DROs. Click for more information about Debt Relief Orders.
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