Struggling with debt? Ask a debt advisor a question

Riverview8 wrote: »

Hello, I have been in discussions with SC re starting a DMP. Currently in the process of setting up new account & transferring salary to it. This is taking a while as employer US based & has to go through US HR.
In the meantime I have been contacting creditors as per advice. However one of my biggest loans is with Smile, whom I also bank & have my overdraft with. Salary will be going into it for at least one more payday. The advice from SC was not to inform them of DMP yet. I am due to make a payment to them on the 19th but will not have funds to make full payment due to a domestic issue. The STO goes on the 19th, I get paid on 28th(will be 26th this month due to 28th being weekend) I have asked to move STO to 28th in the past but should I just amend the STO in this instance to 26th & explain that I need to change the payment date? I can call them or send a secure message. I want to be able to pay this time & as your SC colleague said don't tell them re DMP until new acct has salary going in.
Any advice much appreciated. Thanks a lot.

Hi riverview,

Great news on setting up your DMP with us.

I’d recommend giving us a quick call to talk to us about your situation, we’ll be more than happy to help and we want to make sure you can get everything set up without any difficulties.

We also want to make sure that you’re not leaving yourself in a tricky situation with your bank or having to make major changes to payments and our advisors will be able to discuss this with you.

Details of how to get in touch with us are available on the StepChange website.

We look forward to talking to you soon.

Rory

jusjul wrote: »

Hi im up to my neck in payday loans and debts. Im on a debt management plan, have been for 8 years, ive now also got 4 payday loans, ive just been paid and at midnight last night every single penny has gone, I cant sleep, I need to pay my rent in 2 weeks and my other household bills, im at my wits end, my only way out is if I ended it all. Ive been trying to get a loan of £4,000 over 3 years to pay it all off, I haven't got a guarantor, if I could get loan I wouldn't have any problem paying it back as all my debts would be paid off with the loan money. Im losing the will to live now, I just wish someone would give me a chance.

Hi jusjul,

I’m sorry to hear that things have become so difficult for you and I can’t begin to imagine how you must be feeling at the moment. There is help available, even if you feel like there’s no way out and we’ll be happy to help you.

It’s important that your household bills and living costs are your first priority before you make any payments to your payday loans.

I’m not sure if the loans were taken out before or after your debt management plan (DMP) but I think it would be a good idea for you to speak to whoever is managing it and make them aware of your difficulties.

To make sure the DMP is suitable for you, it should be realistic and affordable and you shouldn't need to take out any further credit, so have a chat about that too.

If you simply can’t afford to make the payments then you should cancel the payments. Payday loans are usually taken from your card using something called a ‘continuous payment authority’ or CPA. You can read a blogpost we wrote on cancelling CPA here.

Once you’ve cancelled the payments you should be more in control of the situation and you can then look at your options moving forward, either with the company dealing with your DMP or with us if you’d like us to help.

As a charity we offer free, impartial and confidential debt advice and solutions to anyone struggling with problem debts. We offer tailored advice and there’s two ways you can get help from us.

You can use our free, anonymous online Debt Remedy tool to create a budget that we’ll use to offer practical advice and solutions to deal with all of your debts including your mortgage and utility arrears. It usually takes about 20 minutes to complete and if you get stuck you can talk to us at any time.

Alternatively you can talk to us over the phone by visiting the StepChange website for more information.

You'll get lots of support in the MSE threads and you're definitely not alone dealing with your debts. If it's starting to affect your health then I'd suggest speaking to your GP for more help.

I hope this helps, we look forward to talking to you soon.

Rory

jusjul wrote: »

Hi Rory many thanks for reply. each month I pay off the payday loans in full, then I have to take them out again so I can pay my rent and other bills, I feel its a no win situation ive got myself into

Hi jusjul,

This is often the case with payday loans and having to borrow more each month can cause further problems.

Without knowing the full extent of the situation it would be difficult to tell you whether these new debts can be added to your existing DMP as in some cases you'll have agreed not to take out any further debts.

If you want to talk to us about this further you can email us at moneyaware@stepchange.org and we'll hopefully be able to point you in the right direction.

Rory

strawberryblonde wrote: »

Hi Rory.
Thanks for your reply. I was told little while ago by my DMP company Payplan not to pay irregular one off payments to my creditors as they could start to demand more money regularly. Is this not correct?
My husband and I are worried about the detriment effects of bankruptcy on our jobs and have heard negative stories of IVAs so feel if we can get the money together that a !!!!!! would be our solution.

Hi Strawberryblonde,

Generally speaking I think creditors are quite pleased to be sent extra money. If payments were up and down all the time then I suppose it could make creditors feel that something strange was going on and prompt them to ask for more.

Having an income that goes up and down can make it tricky to plan a budget. It's hard to get the right balance of having enough money for yourself and paying your creditors as much as possible.

!!!!!! (full and final settlments) can be a good option for some people but I'd not be able to say if it would be right for your situation without knowing more about your finances.

You mention IVA, DMP, full and final settlements and bankruptcy in your message so it sounds like you're well versed in the various ways to approach debts. All of these options can work out well - it might be worth getting in touch with Payplan and getting their opinion.

I've heard some negative stories about IVAs too but usually when they were recommended inappropriately, so I'd suggest keeping an open mind, getting some advice about all the available options and weighing up which is right for you. Payplan will be able to give you this advice. If you'd like a more in depth second opinion then our contact details are in my signature below.

Cheers

James