Rise in people facing Bankruptcy

The video discusses Sue's negative experience with a debt management company, where she ended up owing more due to added interest. An investigation reveals that many people using such companies face similar issues, with fees collected before creditors are paid. Citizens Advice calls for stricter regulations, highlighting unacceptable practices like cold calling and front-loading charges. The FCA is set to take over consumer credit regulation soon, but immediate changes are uncertain.

What was the outcome for Sue after using a debt management company?

• Her financial situation improved.

• Her creditors were fully paid.

• She ended up owing more money.

• She became debt-free.

What percentage of people using debt management companies end up seeking bankruptcy advice?

• Over 10%

• Over 25%

• Over 50%

• Over 75%

What is a common issue faced by users of debt management companies according to the investigation?

• Hidden fees and charges

• Guaranteed financial improvement

• Increased creditor harassment

• Immediate debt relief

Which of the following practices is NOT considered acceptable by Citizens Advice?

• Providing upfront fee information

• Offering debt consolidation services

• Cold calling potential clients

• Charging fees before paying creditors

What is the role of the FCA in the context of debt management?

• To provide loans to debtors

• To offer free financial advice

• To collect debts on behalf of creditors

• To regulate consumer credit practices