Should it matter that your Debtors may have health issues?

With an estimated 50% of those in debt also suffering health issues, is it time to rethink the advice given? 

Citizens Advice have stated that 3 out of 4 people they spoke to confirmed that their debt worries impacted upon their mental health. In addition, over half said that these worries also affected their physical health. This creates a downward spiral for those who cannot work due to health issues. No work = no money = more debt worries = increased health issues = no work. 

If you are trying to recover a debt from an individual, does it matter to you that your debtor may have health issues as a result of their debts? It should do as this dramatically reduces their ability to pay and your prospects of recovering the money owed. 

Whilst Citizens Advice centres have been around for several decades, a pilot scheme is taking place in Merseyside so that a Citizens Advice adviser will be located in GPs’ surgeries. The idea is to make it easier for those with both debt and health issues to seek advice. 

Giving patients access and information about debt is nothing new. On a recent visit to my local Derbyshire GP, I noticed a number of Citizens Advice posters giving information on how to seek advice for debt issues. However, the same cannot be said for all GPs surgeries. 

From a Debt Recovery point of view, ensuring that debtors have access to debt advice is crucial. If a debtor has significant debt issues, the prospects of successfully enforcing any Judgment are reduced. If a debtor seeks advice at the start i.e. before proceedings are issued, most creditors will accept payment plans. Whilst this means that the debt is paid over a longer period of time, the cost to recover that money is minimal, and the likelihood of successfully recovering some, if not all, of the debt dramatically increases. Also, if seeking advice reduces a debtor’s money worries, it will improve their health and speed their recovery and return to work. Once a debtor returns to work their money increases along with their payments to creditors. 

Hopefully Merseyside’s creditors will see an increase in recovery of debts during the pilot scheme and it will be rolled out to the rest of the country. 

For more information on Debt Recovery, visit our website www.smithpartnership.co.uk/debt-recovery or contact Joanne Green for details of our fixed fee Debt Recovery services on 01332 225232 or joanne.green@smithpartnership.co.uk.