Are you feeling the pinch during the credit crunch? Help may be at hand in the form of a new finance claim. This new and fast growing financial claims allows customers to audit any finance agreement taken out since April 2007 to assess whether it has issues which could make it unenforceable. All agreement must follow the rules laid down in the 1974 Consumer Credit Act. Many agreements fail to do this. This means you may be able to wipe out your credit card and loan balances. It doesn't matter if you are in arrears or following a debt management plan or IVA. You can still claim.



The types of agreements which are potentially unenforceable are;-

* credit card agreements

* store card agreements

* car finance agreements

* hire purchase agreements

* unsecured loans

* consolidation loans

You need to find a reputable financial claims management company to act on your behalf. How do you find one from the ever increasing number? And what do you look for?

Up front fees

This is a sore point for some people who wonder why ?upfront fees? are charged at all. The vast majority of financial claims managers charge fees in order to carry out a full and detailed audit. These range from around ?195 to ?495. Basically this is to look at your agreement in detail and assess it for breaches. There is a great deal of work involved. The process takes up to a year at the moment. The rational behind this is that the companies need some form of liquidity as every business does. The fees are refunded if your agreement is found not to be unenforceable. Some companies take a small administration fee.

Auditing ? Don't be mislead

Your agreement must be obtained from your lender before you have a definitive answer as to whether you have an unenforceable contract or not and this will cost you ?10 usually. Some companies offer this free and some request ?1.00 which is the minimum fee stipulated under the data protection act. It is only after a full audit that you will know if you have a claim or not. Some companies mislead clients by saying they offer a free audit when in reality they ask the same preliminary telephone questions that all companies ask to establish if it is worth considering a full audit or not. For example was the agreement taken out prior to April 2007? What is the balance? Different companies claim for different balance amounts. Who is the lender? Some have more of a reputation for writing unenforceable agreements than others. This is not a full audit. As far as I know there is no company out there yet which offers a solicitors audit ? free.

Successful Claims

The majority of companies have been in business for over a year now. Some will be ?introducers? for other main companies. They should be able to tell you how many successful claims they have achieved and the length of time it took to achieve the results.

Back end fees

Some companies charge fees at the completion stage of your claim. Be sure to ask if this is the case for you. Some charge 30% while some charge a fix amount of ?1000. Most companies don't charge any fees.

Other fee structures

I have come across some peculiar fee structure whereby some companies offer to handle your claim for you paying them six months credit card repayments. Others offer to take over your debt for you and leave you debt free in six weeks. I would not take these seriously. There are plenty of straightforward ways to clear your cards for a reasonable fee, no misleading promises of a free audit and certainly no back end fees.

Time scales

The process is a long one relying on the co-operation of your lender which of course is not likely to be forthcoming. The legal to and fro-ing will take up to a year. There is no way to avoid this so claims of speedy conclusions, at the moment, are false. The lenders use all sorts of tactics to delay matter for example refusing to send the copy of the agreement to your claims manager but only dealing with you and completely ignoring the requests made by your solicitor.

Be patient, persist and it will pay off in the end.