herald

Sunday 23 September 2018

In times like these, there is no shame in seeking help

The story that FLAC -- the Free Legal Advice Centre -- has seen its calls from desperate people at their wits' end over personal debt rise by a whopping 400pc was touted as just more bad news on an already grim news day.

I think it's a wonderful thing. No -- not that so many people are in debt, of course. We already knew that. What's good is that, instead of sticking their heads in the sand, putting the unopened final demands in a drawer or burning their credit card statements, they are brave and conscientious enough to do something about their personal financial crisis.

It's more than the Government is doing.

The ill-advised mortgage moratorium instigated by the State has simply kicked the debt can down the road.

Yes, people get to stay in their highly mortgaged, in-arrears home for longer, but they do so while the loan simply gets bigger and bigger, leaving it even more unlikely to ever be paid.

The first step to solving any problem is to acknowledge it. The 787 people who had the guts to contact FLAC last year, or the thousands that are getting in touch with MABS for budgeting advice, are more forward-thinking than their political masters. Both are staffed by volunteers, making it even more shameful that the Government isn't doing more to help people in trouble.



Calls

These suffering, distressed families have seen a huge debt crisis looming; they owe money on credit cards, bank loans and mortgages and are swamped.

They are getting calls daily (or several times a day) from creditors looking for money they do not have. They are getting scary, legal letters from solicitors and debt collection agencies looking for money they do not have. Finding out their rights and getting some good sound advice is an excellent first step.

Noeline Blackwell, who runs FLAC, is a formidable woman. I would hate to come up against her ... if I were a bank.

Anytime I've met her, I've seen how much she really, really cares for the people that call her office.

Likewise, those getting in contact with MABS. It's about time we got rid of any lingering stigma attached to either of these two organisations.

I know people who would still prefer to go to an expensive, fee-charging debt management company rather than MABS because they think it's for "poor people".

I've seen others who will pay €50 an hour to a solicitor to write a letter telling their bank to back off rather than ask FLAC to do it for nothing. Why?

Isn't it about time we finally got over ourselves and realised that the worst thing you can do when you are in deep financial doo-doo is ignore the problem.

Banks never, ever go away. The bailout has ensured that they won't and can't afford to ignore your debt. They will hound you for it forever.

Come March year, the Government will have to have in place new legislation for personal indebtedness. This is not before time.

It will include, if the Law Reform Commission has its way, real problem-solving measures like a proper Debt Enforcement office to provide out of court arrangements between creditors and debtors. The last thing you need on top of a massive loan is a legal bill.

It will allow some debts to be written off, severely reduced or restructured with no lifelong stigma on the debtor. It will ban the utterly ridiculous practice of jailing people for debts.

Don't you see how silly it is for the very people who are in massive arrears with their own debts having to pay their taxes towards helping the banks out of theirs?

It's simply a vicious circle which we must put a stop to.

If that involves having some people who should never have been allowed a mortgage renting for the rest of their lives, so be it.



Double

If it means rapping banks on collective knuckles by getting them to write off debt -- ditto.

We need solutions, not more debt-laden problems.

FLAC and MABS provide them every single day.

Let's hope Noeline is reporting double the number of calls for this year.

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