Chapter 3: The six stages of the debt advice process

• 1. Stage 1: find out the whole situation
• Explain the principles of debt advice
• Explain your remit
• Understand what has happened
• Reassure the client and start building rapport
• Understand that all information obtained from the client is vital
• Information and evidence gathering
• Information for the client
• Client consent, privacy statements and UK GDPR
• Data protection principles
• Lawful basis
• Consent mandate and privacy statements
• Explicit consent
• 2. Stage 2: deal with emergencies
• What is an emergency
• The general strategy
• Sheriff officers are threatening to visit the client’s home and/or remove goods
• The client is facing the imminent loss of essential goods – eg, if hire purchase goods are about to be repossessed
• The client is facing imminent disconnection of essential utilities
• The client is about to be evicted for rent arrears
• A warrant has been issued for the client’s arrest for an unpaid fine
• The client is due in court the next day
• The client has no money for food
• A deadline for a response to enforcement action is approaching
• The client attends with an expired charge for payment
• An overview of basic tactics to deal with emergency situations
• Signposting or referral
• 3. Stage 3: check liabilities
• Joint and several liability
• Checking liability
• Debts after death
• Debt lapsed because of time
• Faulty goods
• Minors
• Incapacity
• Undue influence/duress
• Fuel/beneficial user
• Could the debt be reduced?
• 4. Stage 4: listing creditors and priority and non-priority debts
• Identify and list all debts
• The creditors
• The debts
• Priority debts
• Types of debt
• Sanctions and client needs
• Dealing with priority debts
• Non-priority debts
• Types of non-priority debt
• Dealing with non-priority debt
• 5. Stage 5: create the initial Common Financial Statement
• What is a financial statement
• The Common Financial Statement
• How to access the Common Financial Statement
• How to complete the Common Financial Statement
• The trigger figures
• How creditors use the Common Financial Statement
• Issues with local and UK government creditors
• Common Financial Tool
• Who can access the Common Financial Tool
• 6. Stage 6: maximise income and reduce expenditure
• Overview of maximising income
• Benefit check
• Tax allowances, rebates and tax codes
• Tax allowances
• Tax rebate
• Tax code
• Child maintenance
• Charity payments
• Insurance payments
• Other sources of financial help
• Trade unions
• Civil compensation for damages
• Council tax discount or reduction
• Food banks
• Private and occupational pensions
• Reduce expenditure
• Utilities
• Satellite TV
• Telephone, mobile and internet
• Vehicles
• Meals at work
• Non-essential items
• Council tax
• Luxuries and non-dependants
• Challenging low spending
• Non-judgemental approach
• Do not blame the client

When clients are about to have their first interview with a debt adviser, they can feel embarrassed, ashamed, uncertain, judged and many other negative emotions. The stigma of debt can create barriers which may prevent a client from being open and honest about their situation. A debt adviser needs to reassure the client, build trust and ensure they feel safe about sharing their information.

This chapter looks at how to build that rapport with a client, to understand their whole situation and to work through the six stages of the debt advice process.

It is always possible that the stages may be in a different order than stated, or that you will deal with some of them together, but it is a useful tool to keep you on track.