Debt Advice Please!!!

AGibson · 21 January 2009 at 10:42AM

Hello

I am hoping you can give me some advice, I currently have over £18k worth of unsecured Credit card and a bank over draft debt with me, recently last year I lost my job and cannot afford to pay the minimum payments to the creditors, I have been covering at least the minimum payments up to November 2008, and now I do not have the funds to do this as I am only receiving benefits (job seekers), I’m also in the mean time looking for another job and have been to a fair few interviews.

I spoke to payplan in November who sent me a useful help pack and in turn worked out my expenditures and what I can afford to pay my creditors. As it stands I can only afford to pay the creditors £25 per month till I get a job. I spoke to all the creditors beginning of December explaining my problem and that I cannot afford to pay them the minimum payments and will be offering token payments.

At the end of December I sent them all the proposal letters with my expenditures etc... (Recorded delivery) explaining the problem also asking them to freeze interest and charges - using the payplan templates.

I have been making payments each month (Dec / Jan) (the reduced amount I can afford), I’ve spoke to them numerous times but they say different departments are looking into it etc... And I will be called / written to but so far with no luck and it’s around a month now since sending them my proposal.

I’ve received default notice from 3 of the creditors, DEFAULT NOTICE SERVED UNDER SECTION 87(1) OF THE CONSUMER CREDIT ACT 1974, saying I have breached the terms of payment clause of the agreement.

Payplan have advised to ignore the letters and keep making the payments in the proposal, I’m just wondering is this the best advice?

They said they probably will not reply to the payment proposals, and their aim is to make you worried and not pay them anything at all so they can use this against me.

The also said they cannot legally get a debt collector to come around, all they will probably do is enforce a CCJ.

I’m just wondering how I should proceed from here?

One of the creditors sent me the default notice says I need to remedy this default by paying £250+ before the end of Jan or further action may be taken. Which is impossible as I do not even get that much per month

any advice would be appreciated please

thanks in advance

MessyMum · 21 January 2009 at 10:49AM

Hi there,

We have been making token payments since Dec 08, also sent the letters recorded etc. Our creditors basically ignored what we said, HSBC sent a letter saying they wont accept £1.75 per month but would accept £20 (if they looked at the income & Expend sheet they would see we so don't have that ammount).

I would say just keep paying the token payments and contact them again when your circumstances change.
From what I have been told the worst that is likely to happen at the mo is a CCJ which would probably mean you will only pay what you are now as that is what you can afford.

Someone more experianced will be along soon.

MM x
p.s sorry for the waffleing

denise123 · 21 January 2009 at 11:08AM

have no advice for you, but just wanted to say good luck.

I had this problem years ago before i went bankrupt, token payments of £1 sent recorded etc, i&e sent phone calls on and on it went

was told then, at that time, that CC companies are so bogged down with thousands of people all doing the same as you are doing, that the paperwork can take months to sort out their end, so dont worry, or try not to, you are doing the right thing, carry on paying a quid a month, carry on with them about freezing the interest, you are doing it all as you should be doing.

and if they take you to court? well, any judge will see by your paperwork that you have been trying, and i dont think the CC company will look that good to him/her, and you will maybe be asked to carry on paying the quid a month without interest being added until your in a better postion

i hope you are keeping copies of everything that you have sent them and keeping the information that they have sent you, and that notes of phone calls made to and from etc are all being written down by you, [when they phoned, or you phoned them, the names of who you spoke to, and notes of what was said etc, it all helps in some way]

anyway good luck, you are not the only one, and try not to worry to much ok

they cant afford to loose your custom in this climate, and you are trying to keep them happy, no judge will look on you as bad,[if it gets to that stage, which i dont think it will] rather as a good person trying to do their best.

and anyway as was said before, a ccj will only be something more offical that allows you to pay what you are paying now.

and remember when you are talking to the cc compaines, if you can only afford to offer them £25 a month, start on ten pounds a month, as they will try to badger you into paying a higher amount, again i can only go by what happened to me, i did as you did, i worked out i could afford £50 a month if they helped me by freezing the interest, so i said straight away £50 a month, they knocked me up to £60 a month i think it was.

so start at a tenner a month, let them think they are doing the job they should be doing, and knock you up to £25 a month.
hope someone comes along with better knowledge than i have, it may all be different now, i dont know.

take care ok

Lucascain_2 · 21 January 2009 at 11:10AM

AGibson wrote: »

Hello

I’ve received default notice from 3 of the creditors, DEFAULT NOTICE SERVED UNDER SECTION 87(1) OF THE CONSUMER CREDIT ACT 1974, saying I have breached the terms of payment clause of the agreement.

Payplan have advised to ignore the letters and keep making the payments in the proposal, I’m just wondering is this the best advice?

I've been on a payment plan with Capital One for over a year now, paying them £70 per month.

Two weeks ago I received a default notice, which, being as I have a standing order set up to pay this amount every month, really confused me. I made a phone call to Capital One, who told me that it's a new government legislation for anybody who arranges a payment plan, they must serve them with a default notice, regardless of how long I'd been on the payment plan.

Hope that made sense.

needaspirin · 21 January 2009 at 11:12AM

AGibson wrote: »

I’ve received default notice from 3 of the creditors, DEFAULT NOTICE SERVED UNDER SECTION 87(1) OF THE CONSUMER CREDIT ACT 1974, saying I have breached the terms of payment clause of the agreement.

A default notice is a form which must be issued by a creditor for all debts regulated by the Consumer Credit Act 1974 before court action can start. The default notice must contain the following details:-

* the type of agreement
* what terms of the agreement have been broken
* what action is necessary by the client, for example, to pay the arrears by a certain date
* the action the creditor intends to take if the client does not comply with the default notice.

Once a default notice has been issued, the creditor can:-

* terminate the agreement
* recover any goods or land which form part of the agreement
* demand early payment of money due under the agreement.

Even if a creditor has issued a default notice, s/he will not necessarily start court action and it is always worth trying to negotiate with the creditor even if the time limit has expired.

AGibson · 21 January 2009 at 11:43AM

Hello

Thank you for your replies, I’ve kept all correspondence from the creditors and all the letters sent to them, (I’ve sent them recorded delivery), I’ve kept some logs of the phone calls, my main concern is that they might send debt collectors around to try and take goods etc...) and also the fact that I’m living with my parents so I don’t think they will take it too kindly if someone comes knocking round trying to take their goods

, is it possible to threaten using debt collectors already? As one of the creditors did say the banks can do this back in November last year.

Roughly how long has it taken for a response from the creditors, from sending the proposals out? I would have thought a month is plenty of time.

The default notice from one of the creditors says that I have failed to pay the minimum required 2 months in a row and stated the amount I’ve paid each month.

Also payplan did say if your only getting benefits then all you need to pay them is £1 per month token payment (or as much as you can afford) until you get in a position to being able to pay them more. After looking at my expenditures I’ve set aside the £25 to pay them.

Another thing regards interest and charges; do they normally stop / freeze them? I asked them to in the letter to prevent me going further in debt.

Thanks again

TotallyBroke · 21 January 2009 at 11:50AM

post up a soa https://www.makesenseofcards.com/soacacl.html it will then show us how many creditors you have. The min payment of £1 is normally per debt. If you have set aside £25 is that for 25 different debt companies at £1 each or is that split between 2 companies.

Post up the soa and then we can see where money can be saved or advise on other things like the threat of the bailiffs etc.

Jesthar · 21 January 2009 at 11:53AM

Heya, welcome!

Can't answer the creditor response time queries, but regarding the removal of goods and/or doorstep collectors, don't worry! Baliffs (the ones which take goods) can't be used until a judge has ruled they can do this in court, and you are quite a way off that at the moment I should think. Baliffs would NOT be allowed to take any goods belonging to your parents, only good belonging to you.

There is a very small chance they might send a doorstep collector round to try and persuade you to part with some cash, but if you are one of the few unfortunate enough to have this done, then just remember the collector has exactlry the same legal rights to demand money or goods than the postman does (i.e. none whatsoever!), so don't open the door to them or let them in, and if they fail to leave the doorstep when told to you can call the Police on them!

~Jes

lxpeanut · 21 January 2009 at 12:34PM

[quote=AGibson;17909261]

Another thing regards interest and charges; do they normally stop / freeze them? I asked them to in the letter to prevent me going further in debt.
[/quote]

Unfortunately they don't have to do this. You story is normal I'll go through what happened to me with my credit card it might reassure you a bit:

Late 2006 I contact all my creditors with financial statements ect and made them offers of payment. The completly ignored me and didn't even acknowledge letter.

January 2007 contacted CCCS they contacted creditors. My credit card company did not get in touch. I started making the reduced payments anyway and once the account was in arrears they contacted me. They then accepted the payment offer and froze interest and charges.

Mid 2008 started adding interest/charges again. After a few phonecalls to them they stopped putting charges on and reduced the inerest.

Sometime in the last three months (sorry this bit is a bit hazy) they sold the debt to a debt collection agency.

So unfortunatly we all incure some interest/charges and increase the debt a bit. I'm planning on complaining about how they handle debt. I don't expect I will get anything back but if people start complaining we might start to see their policies changing.

I've had default notices on all my debts and all have said if you don't pay your arrears further action will be taken including court action. The further action is usually sending the debt to their debt collection department or an outside agency. None have yet actualy taken me to court. Even when you go to court you can make an offer as to what you can pay and the court will accept it. Its only if you refuse to pay anything they start sending in Ballifs.

AGibson · 17 February 2009 at 5:12PM

Hello there, sorry ive not had internet connection for the last few weeks, i will post up the expenditure details shortly tonight if its any help.

I think so far one of the creditors has accepted my payment proposal for at least 12 months, the rest have either for a short term or are not interested

I think so far all of them have sent inormation about a default notice may be applied to me, all have atleast stopped interest.

thanks for all your help

AGibson · 18 February 2009 at 8:10PM

here are my expenditures:

per month

payments in = £240

payments out = £215

internet (broadband) £18
telephone line rental (Bt line) £10.33
Insurance £50
Road Tax £13.67
Mobile £10
Fuel £40
Food £20
Toiletries £10
Haircut £10
Clothes = £25
Vechicle repairs / parts = £8

total avaliable to creditors = £25

thanks

Debt Advice Please!!!

Comments

Confirm your email address to Create Threads and Reply

🚀 Getting Started

Categories

Is this how you want to be seen?

Get our FREE Weekly email full of deals & guides - and it’s spam-free