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Hey Everyone :)

First post here, so appologies if this is in the wrong place, but i do want to be Debt Free!

I have had credit cards now since i was 18, im now 21 (so not too bad). But i can see the downward spiral of debt starting and i want to hit this before it becomes too much for me to handle.

Here is what i currently have in outstanding loans/credit Cards/HPI`s:

Loan: £2,000
Credit Card £3,000
Over Draft: £1,000
HPI £6,000

Total = £12,000

So i guess the question is, what am i doing about all this? Well, first of all i am loosing my car, with the current Tax and Petrol rises i could easily live without one, it spends 3 out of 4 weeks sat on my drive. So i will be returning it to the HPI company and dropping it. Everything else though, i am kind of stuck with. The only problem i face is today, its the worst i have ever seen my account with the over draft, usualy i am always in credit. 2 weeks ago my profile on the Credit Score card was rated as "Good" its now set to "Room for improvement".

With my job i incurr allot of expenses, so this is why i am stuck in an over draft and until i get repaid i am kind of stuck with it. However that doesnt bother me, what does bother me is my bank account charging me £25/day for being in an over draft and NOT allowing me to secure an agreed over draft so i can loose the fee. Ontop of that 2 of my direct debits got returned this month. I have already phoned to explain why and the companies are fine with this. What bothers me though, is that if it wasnt for these charges i would of been back in the clear next month once i got paid (As my expenses come through) but with the bank sucking off nearly £250 in fees and Returned Direct debit fees also hitting another £100 i fear that im going to be stuck in another over-draft next month again.

I have considered possibly getting a loan to consolidate all this debt (whats outstanding, minus the car). S othat its a little more manageable, but with companies charging me upto 45% APR, its just silly!

However, what i would like to know is what advise do you all have? Am i too late? Am i doing the right thing? Or am i just getting paranoid? :(

Many Thanks in advanced for any help you can offer.

Regards,

Rolo
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Comments

  • In_Search_Of_Me
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    Well done for posting and for tackling it before it gets out of hand. It would be worth posting your soa so that we an see if and where you can cut down...What is your credit score like? It may be worth looking at getting a 0% card but without knowing the ins and outs its hard to say as what you can pay depends on disposable income IYKWIM! A good thing is to start a spending diary to see where money goes - it often fritters and that can be a real eye opener. Also joining the old style boards can help reduce grocery budget....most of all get stuck in, check that you have cheapest utilities etc (see tabs at top of page) and you'll have it paid off in no time!
    Nerd no 109 Long haulers supporters DFW #1! Even in the darkest moments, love and hope are always possible.

  • RoloMe
    RoloMe Posts: 13 Forumite
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    Thanks In Search Of Me :)

    I am sorry, but unfortuantly im not down with the money talk yet, so when you say an SOA what do you mean exactly?

    I have just been reading through the forums and it seems like Alliance And Lester offer an over draft that is only 50p a day, so i just threw in an application to see if they will take me on! If so then thats part of my worries for next months fees taken care of, coupled with getting rid of my car it should save me around £600/month :D

    My credit score according to Equifax im "Needing Improvement". They rate credit in one of 5 Areas:
    • Excellent
    • Good
    • Fair
    • Needs Improvement
    • Poor
    2 Weeks ago, i was marked as having a "Good" Profile before my over-draft got the better of me. So this was a big wakeup call that i need to start doing something before it gets too late.

    If you need anythign else let me know and i will be more than happy to provide it :)
  • get_me_out
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    SOA is basically what you have coming in and what you pay out. Don't incl your debt payments, list them below after household stuff. That way you can see what has to be paid and we will try and advise where to save money.
    BSC No: 186 There is always light at the end of the tunnel. Unless someone's nicked the candle !
  • **Amy**
    **Amy** Posts: 2,680 Forumite
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    Hello and welcome

    Firstly I wouldnt worry too much about your credit score. What actually matters is your report and any accounts with defaults or CCJs on there? (and missed payments etc.). Have a read of Martin's bit about scores:

    http://www.moneysavingexpert.com/banking/credit-rating-credit-score

    Secondly it sounds like you are tackling this debt with a very positive attitude, so well done.

    An SOA is a statement of affairs. Its basically your incomings and outgoings every month, including your debts, their APRs and your payments. Use the link below to do yours and post it up on this board. That way we can best see your situation and try and help you out.

    http://www.makesenseofcards.com/soacalc.html

    It may also be a good idea to read the below link:

    http://www.moneysavingexpert.com/loans/debt-help-plan

    Its a good place to start.

    I hope this helps.

    Regarding your bank, I would maybe switch banks if you can and treat the Overdraft as a loan and pay it off.

    Please do not consolodate as this is generally just gaining more debt for a longer period of time.

    x
    Debt: just my mortgage :D
  • trancebabe
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    Have a look here
    http://www.makesenseofcards.com/soacalc.html

    it's an SOA calculator.. .really easy. Fill it in and post the results for the good people here

    :0)
  • RichOneday_2
    RichOneday_2 Posts: 4,403 Forumite
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    RoloMe wrote: »
    Thanks In Search Of Me :)

    I am sorry, but unfortuantly im not down with the money talk yet, so when you say an SOA what do you mean exactly?

    I have just been reading through the forums and it seems like Alliance And Lester offer an over draft that is only 50p a day, so i just threw in an application to see if they will take me on! If so then thats part of my worries for next months fees taken care of, coupled with getting rid of my car it should save me around £600/month :D

    My credit score according to Equifax im "Needing Improvement". They rate credit in one of 5 Areas:
    • Excellent
    • Good
    • Fair
    • Needs Improvement
    • Poor
    2 Weeks ago, i was marked as having a "Good" Profile before my over-draft got the better of me. So this was a big wakeup call that i need to start doing something before it gets too late.

    If you need anythign else let me know and i will be more than happy to provide it :)

    Are you sure the credit indication was adjusted because of theoverdraft? It would seem harsh moving you down 2 'grades' for slipping in to overdraft for a month for the first time. Plus, Equifax take a few weeks to update, so it may be worth getting the full credit report to see if something else has crept in there.

    In terms of the overall picture, to be honest I think you've already done what's needed. Surely, saving £600 per month must sort you very quickly.
    Gt NW 1/2 Marathon 21/2/2010 (Target=1:22:59) (6:20/mile) 1:22:47 (6:19):j:j
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    Abingdon Marathon 17/10/2010, (Target=2:48:57) (6:27/mile)
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  • nementai
    nementai Posts: 164 Forumite
    First Anniversary Combo Breaker First Post
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    Which bank are you with? Some banks are more relaxed about giving overdrafts than others. There's a page on this site which compares current accounts - have a look and see if you can change over - there are even a few interest free overdrafts available. If you went to Uni, try a graduate account too, they usually give large, free overdrafts as standard.

    Or will your company give you an advance? I had one when I was doing a lot of travelling. I went to them, explaining about being in overdraft and they agreed to meet my average monthly spend of £200 with an advance, on the condition it was to be repaid on leaving the company.

    Once you've got the immediate issue sorted, there's a wealth of info on here about paying the rest off. The soa is a good start and I love the debt snowballer for keeping me on track. Looking at all your little luxury spends and tightening the basics can leave you with a couple of hundred quid extra a month and you should have cleared the debt in no time. Consolidation loans are usually not recommended, but again, go trawl the articles Martin's written about all of this.

    Most of all, keep reading about other people's successes - if I get frustrated with my £3500 debt - I look at people on here who's paid off £100s of thousands in a matter of a year or two and suddenly it all seems a lot easier!

    Good luck!
    When we choose not to focus on what is missing from our lives but are grateful for the abundance that's present....we experience heaven on earth. Sarah Ban Breathnach
  • RoloMe
    RoloMe Posts: 13 Forumite
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    Thanks for all the replies and advice so far everyone, its great to see the community helping out :)

    A few people asked which bank i am with, currently lloyds TSB, although Alliance & Leicester have just approved me a new current account with a 0% overdraft for 12 months and there after its only 50p a day as opposed to £25/day + Interest + Fee i have with Lloyds TSB at the moment (currently filed a complaint so i can re-claim my charges as i found elsewhere on this site). I contacted lloyds, explained that due to my expenses with work i am stuck in an overdraft and getting hammered with fees and if they could arrange anything, but they refused, very dissapointing.

    In other news the Finany company for the car got back to me, they want to charge me £2.500 to return the car. Now i am due to write a letter and read my contract again but does anyone know why its this ammount? Its a HPI Agreement, so my understanding is its hired to me and they own the car until i make all payments and then a "Settlement" Figure. If i was to pay them £2,500 for the car then i would of effectively (with what i have paid so far) paid off £5,000 leaving just another £1,000. Does this make any sense to anyone as to why i should be paying such a substantial sum to return the car?

    As i said, i will be looking into my contract and asking them (i already did, but conveniently they didnt answer the question!) about this.

    Many Thanks Again!
  • amyandjon
    amyandjon Posts: 349 Forumite
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    well id not pay and then they take the car off you no charge lol :P id say im returning the car and not paying or il not pay the direct debit so your forced to take it from me !! do not pay 2500 ive never returned a car so i dont know biut i dont have a hpi car ..... but 2500 tell them to whistle !!:P settle for that or a token payment cheeky swines are you posting an soa ?? AMy
    The loans will pay themselves the credit cards need a kicking :money: DFW Long haulers supporter 132!!:T
  • RoloMe
    RoloMe Posts: 13 Forumite
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    Hey Amy!

    Thanks for the quick reply :D Yeah im glad im not the only one who was thinking that the unexplained "Charge" was a bit high! Im currently working on my SOA and trawling through my bank statements as we speak to make sure that i get everything in there, its always the small payments that seem to escape me!
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