Struggling with debt? Ask a debt advisor a question

Former_StepChange_Laura · 18 November 2014 at 1:10PM

sunshineyday6 wrote: »

Heloo-I have received a default notice from creation even though they didn't return a correct cca and the ombudsman is dealing with my case-I am so confused,I stopped paying after not receiving the CCA and had so many calls which have now stopped thank goodness, is this correect whilst it is with the ombudsman ??

Hi there sunshineyday6,

Thanks for your message. It’s likely the default notice was sent to you automatically when you stopped making the payments, so the creditor is just following their normal process. If the Financial Ombudsman decides that you don’t owe the debt, the debt collector should remove the record from your credit file.

However if they decide you do owe the debt, you should be aware that cancelling payments to your creditors could mean they add fees and charges in line with your original agreement with them. If you’re concerned about this, it’s something I’d suggest you speak to the Ombudsman about as they will be able to advise you more specifically on your personal circumstances.

It’s good news that the phone calls have stopped – many debt collectors will back off while they’re waiting for the Ombudsman to make a decision, although they don’t have to do this.

I hope this helps.

Kind regards,
Laura

[Deleted User] · 18 November 2014 at 2:33PM

I would really welcome some advice please - I feel at a complete loss as to what to do.

I have 3 credit cards with a total balance of £7387 costing approx. £255 p/m in (just above minimum) payments. I also have an arranged £2000 overdraft - of which I'm using 95% (costing £15 p/m)

I have been in full time employment for 7 months (Salary £32k), prior to that I was registered self-employed for approx. 2 years.

My accountant has advised me my taxes due for next year (for 2013-14) will be approximately £3800.

Through a variety of factors which I don't wish to go into, I simply won't have that money (or half of it) in January.

Last night I applied for a Natwest loan, with a view to pay off all 3 Credit Cards and have enough for the tax. I was told that subject to paperwork this was agreed. A huge weight off my mind.

I received an email from Natwest earlier to query my monthly rental amount - the amount specified didn't match the amount on record. I had made the mistake of only declaring my 50% contribution to the rent, not the full amount. Easily rectified with a phone call - however, during the 30min phone call I was advised that Natwest could not normally provide this loan since it was (partially) to repay tax.

I am aware that negotiating a repayment plan with HMRC is a possibility, however 3800 / 12 months (max) is simply outside any feasibility for repayments taking into account the existing £255 p/m on credit cards. Additionally, I simply cannot leave it up to HMRC to 'take what they need' from my salary.

Natwest advised that they do offer a tax-repayment loan, strictly over 12 months. But with payments of £321 per month - this too just isn't feasible (I would not have enough money to live on).

They also advised that even though its a shared tenancy, when the monthly rental amount was changed to the full 100% - it would impact my chance on getting the loan.

Finally - whilst on the call, the Natwest advisor did suggest that because I had already been accepted, the paperwork is on its way to me - and without explicitly saying so - it was up to me whether I declared what the money was for (and that the underwriters would make a decision)... This does not sit comfortably with me at all though.

I am not home owner (private tenant, single and have no dependants). The only other existing finance is for my car. My credit history is good in terms of repayments.

Any advice would be greatly appreciated. Last night I felt a huge weight had lifted - only to have it come crashing back down on me today.

Former_StepChange_Laura · 18 November 2014 at 5:24PM

Deleted_User wrote: »

I would really welcome some advice please - I feel at a complete loss as to what to do.

I have 3 credit cards with a total balance of £7387 costing approx. £255 p/m in (just above minimum) payments. I also have an arranged £2000 overdraft - of which I'm using 95% (costing £15 p/m)

I have been in full time employment for 7 months (Salary £32k), prior to that I was registered self-employed for approx. 2 years.

My accountant has advised me my taxes due for next year (for 2013-14) will be approximately £3800.

Through a variety of factors which I don't wish to go into, I simply won't have that money (or half of it) in January.

Last night I applied for a Natwest loan, with a view to pay off all 3 Credit Cards and have enough for the tax. I was told that subject to paperwork this was agreed. A huge weight off my mind.

I received an email from Natwest earlier to query my monthly rental amount - the amount specified didn't match the amount on record. I had made the mistake of only declaring my 50% contribution to the rent, not the full amount. Easily rectified with a phone call - however, during the 30min phone call I was advised that Natwest could not normally provide this loan since it was (partially) to repay tax.

I am aware that negotiating a repayment plan with HMRC is a possibility, however 3800 / 12 months (max) is simply outside any feasibility for repayments taking into account the existing £255 p/m on credit cards. Additionally, I simply cannot leave it up to HMRC to 'take what they need' from my salary.

Natwest advised that they do offer a tax-repayment loan, strictly over 12 months. But with payments of £321 per month - this too just isn't feasible (I would not have enough money to live on).

They also advised that even though its a shared tenancy, when the monthly rental amount was changed to the full 100% - it would impact my chance on getting the loan.

Finally - whilst on the call, the Natwest advisor did suggest that because I had already been accepted, the paperwork is on its way to me - and without explicitly saying so - it was up to me whether I declared what the money was for (and that the underwriters would make a decision)... This does not sit comfortably with me at all though.

I am not home owner (private tenant, single and have no dependants). The only other existing finance is for my car. My credit history is good in terms of repayments.

Any advice would be greatly appreciated. Last night I felt a huge weight had lifted - only to have it come crashing back down on me today.

Hi Deleted_User,

Thanks for your message and welcome to the forum. First of all, you’ve come to the right place to ask for advice. At StepChange Debt Charity we offer free and impartial debt advice to people in similar situations every day, so this is something we can help you with.

I’m sorry to hear that it’s added to your stress at the moment, but the fact that Natwest isn’t able to provide the loan you originally requested might not be such a bad thing in the long term. Taking out more credit to pay off existing debts isn’t something we would often advise. You can read a bit more about why consolidation loans like these aren’t usually a good idea in this blogpost: http://moneyaware.co.uk/2013/01/to-debt-consolidate-or-not-to-debt-consolidate/

From what you’ve said, I’d suggest you get in touch with us. Our debt advice is free, and we offer a range of debt solutions which you can read about here: http://www.stepchange.org/Debtinformationandadvice/Debtsolutions.aspx We’ll be able talk to you in more depth about your financial circumstances, put together a budget, and discuss with you what will be your best options for dealing with your debts. It’s good that you have an idea of how much you’ll owe HMRC for the 2013-14 tax period, as this is something we can take into account when advising you.

You can give one of our advisors a call on 0800 138 1111. Our helpline is free to call from landlines and most mobiles, and is open from Monday to Friday from 8am until 8pm and Saturdays from 8am until 4pm.

We look forward to hearing from you soon.

Kind regards,
Laura

iza.idea · 21 November 2014 at 9:30PM

Hi I was wondering if. Someone could help me please I've had DMP with Stepchange for the last 13 months paying around £240 a month recently I've done review online and increased the amount to £270.I made a payment on 1st of November but only for £268 because I thought that was the right amount,I got an e-mail today from Stepchange saying they had to cancel my DMP because I didn't respond to their calls about missing payments?I don't know what to do now I've been through hell recently but at least stepchange helped with with my debts :/I was really happy on DMP with stepchange and now I'm back to a square one :/I didn't miss this months payment it was only £2.00 less,does anyone know if there is any chance they can reinstate it?Its Friday evening and they're not opened till Monday Thanks

rsinnes4390 · 21 November 2014 at 9:46PM

Hi, Im new here, need some advice if thats ok...

I am 24, student with long term health problems, i have about £5000 worth of debt and i cant clear it. i have been in touch with step change, and they have a debt management plan for me, but they are asking me to pay £70 a month and im struggling with money as it is without paying that yet.
my health is very bad but i have had to apply for a job as i dont know how i can afford to clear these debts.
someone mentioned getting a credit card, paying all the debts off that, then pay the credit card, as its easier just having one thing to pay.....
or go bankrupt.... i dont know what to do....

oh and just received a letter from HMRC saying that myself and my ex partner got overpaid £400 working tax credits.... we never have ever received working tax credits before he left....

many thanks.

bellola · 23 November 2014 at 3:18PM

Hi,

Just after some advice please. Both myself and my husband have accumulated debt over the last few years which totals around £25k. Made up of 3 loans & 2 credit cards. For the last year we have not gone further into debt and have just been paying it off. Our monthly payments to clear the debt total up to around £700 which whilst we can afford to pay it, it seems like such a high amount. We now have 2 children and the 4 of us are very cramped living in our 2 bed house which is mortgaged. We are desperate to move but due to the debt we are unable to get a mortgage big enough to get us a bigger house. We therefore need to concentrate on clearing this debt. Are we best to see if we can consolidate? Or clear one at a time? I'm not really sure where to begin! Thanks.

Former_StepChange_Rachel · 24 November 2014 at 10:08AM

iza.idea wrote: »

Hi I was wondering if. Someone could help me please I've had DMP with Stepchange for the last 13 months paying around £240 a month recently I've done review online and increased the amount to £270.I made a payment on 1st of November but only for £268 because I thought that was the right amount,I got an e-mail today from Stepchange saying they had to cancel my DMP because I didn't respond to their calls about missing payments?I don't know what to do now I've been through hell recently but at least stepchange helped with with my debts :/I was really happy on DMP with stepchange and now I'm back to a square one :/I didn't miss this months payment it was only £2.00 less,does anyone know if there is any chance they can reinstate it?Its Friday evening and they're not opened till Monday Thanks

Hi there, thank you for posting.

I’m very sorry this has happened and can imagine it’s been quite distressing for you. Could you please give us a call and we’ll look into it?

Best regards

Rachel

Former_StepChange_Rachel · 24 November 2014 at 10:10AM

rsinnes4390 wrote: »

Hi, Im new here, need some advice if thats ok...

I am 24, student with long term health problems, i have about £5000 worth of debt and i cant clear it. i have been in touch with step change, and they have a debt management plan for me, but they are asking me to pay £70 a month and im struggling with money as it is without paying that yet.
my health is very bad but i have had to apply for a job as i dont know how i can afford to clear these debts.
someone mentioned getting a credit card, paying all the debts off that, then pay the credit card, as its easier just having one thing to pay.....
or go bankrupt.... i dont know what to do....

oh and just received a letter from HMRC saying that myself and my ex partner got overpaid £400 working tax credits.... we never have ever received working tax credits before he left....

many thanks.

Hi there, thank you for posting.

Your DMP payment has been calculated based on what’s left over after you’ve paid all living expenses. If you’re finding the monthly amount a bit of a struggle, it might mean that we need to take a review of your budget and make sure it fully covers everything you need. Could you please get in touch and we’ll look into it for you?

It would also be a good idea to give the Department of Work and Pensions a call regarding the £400 tax credit overpayment they say you owe them, and tell them that you believe this to be an error.

Best regards

Rachel

Former_StepChange_Rachel · 24 November 2014 at 10:13AM

bellola wrote: »

Hi,

Just after some advice please. Both myself and my husband have accumulated debt over the last few years which totals around £25k. Made up of 3 loans & 2 credit cards. For the last year we have not gone further into debt and have just been paying it off. Our monthly payments to clear the debt total up to around £700 which whilst we can afford to pay it, it seems like such a high amount. We now have 2 children and the 4 of us are very cramped living in our 2 bed house which is mortgaged. We are desperate to move but due to the debt we are unable to get a mortgage big enough to get us a bigger house. We therefore need to concentrate on clearing this debt. Are we best to see if we can consolidate? Or clear one at a time? I'm not really sure where to begin! Thanks.

Hi there, thank you for posting.

From everything you’ve told us, it certainly sounds like you would benefit from some free debt and budgeting advice. We wouldn’t usually recommend debt consolidation, as it can often mean a higher interest rate which can be even more difficult to manage. Please read our blogpost for more information on consolidation loans and what they can involve.

If you would like us to take a look at your situation and give you some guidance moving forward, we will need to take a look at your budget and living expenses. There’s two ways we can do this:

You can use our anonymous online advice tool Debt Remedy that can help you put together a personal action plan in approximately 20 minutes, or you can talk to one of our friendly advisors via our contact us page.

Hope this helps

Best regards

Rachel

boredsailor · 24 November 2014 at 11:38PM

I am after some advice with regards to my debt.

In short, due to a combination of poor choices and bury my head in the sand attitude, my debt has spiraled to almost unmanageable proportions.

I currently have combined unsecured debt of approximately £30k (£30,105 to be exact).

This is split between 4 credit cards and an overdraft, details below:

Lloyds CC - £11,461 with a min payment of £300 pcm
Barclaycard CC - £1,421 with a min payment of £35 pcm
Natwest CC - £5,299 with a minimum payment of £100 pcm
Virgin CC - £10,522 with a minimum payment of £300 pcm
Lloyds O/D - £2,700 which never clears

My wife and I own a mortgaged property of approximately £175,000 which has an outstanding mortgage of £118,000. I have made subtle enquiries about remortgaging but the mortgage provider are unwilling to lend probably due to the amount of my unsecured debt. There is also a second charge on the property which was a 5 year £15,000 interest free loan with the 5 year period up for renewal in December. This is further compounding the issue as we are also keen to clear this before the interest starts totting up.

My take home wage is approximately £2,700 pcm. From the figures above you'll see that my debt servicing is taking up £735 of this. This leaves £1965. £1620 of this goes to my wife for housekeeping and covers all the outgoings (food shopping, bills, mortgage etc) and we are up to date on all financial commitments. We have rationalized where we can and don't believe there are many more savings to make. From the little that is left (£345) my monthly fuel allowance is approximately £280 due to me working 180 miles away from home Mon - Fri and only returning home on the weekend. This leaves £65 for the remainder of the months living costs and has recently resulted in me utilizing credit just to feed myself whilst at work, sometimes even missing meals. My wife also works but her wage only equates to approximately £175 pcm and she also gets the Child Benefit for our two children paid to her.

I was contemplating a consolidation loan but having read your pages, am reluctant to borrow more, despite the appeal of paying out less per month.

What are my options? Is there any truth in the myth that a proportion of debt can be written off? There is obviously some £55k equity in the house (£40k if you take away the second charge) but how do I release this without selling up? Are there any mortgages out there which would allow me to clear the debt and secure it against the house? I'm not keen on the IVA route or anything which will affect my credit rating in the future if I can avoid it. I just want an end to the never ending cycle as at the minute, each month seems to bring more and more desperation and stress and I don't see an end to the cycle!
Many thanks in advance.

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