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Me, My 60k credit card debt, and why you should not lose sleep.
billybob05_2
Posts: 15 Forumite
I hope you can pay all your cards off without having to wreck your credit score, but if it all goes pear shaped like it did for me 6 months ago PLEASE DON'T LOSE SLEEP. I actually laugh now when the stern voice on the phone who is usually Mr Payback or Mrs Oweus, because I realise they are employed to use all the tactics under the sun to get you to pay them, most of them will be on commission, and MOST IMORTANTLY, depspite all the threats, there is very little they can do.
I owe 60000 quid, and before the people on this forum judge, ask me how or why, as we all know things happen, things go wrong, and the people who are in debt in here aren't all wreckless consumers who wanted everything and wanted it now, some people just went off course, and if you go slighly off course the interest rates soar and the debts grow quickly.
NOW I get 20 letters a week, 10 phone calls a day, but I have never had anyone visit me in person (infact when I questioned a personal visit with on e company they implied it would be a personal phone call!) Some of the people who call are nasty pieces of work, maybe it's the way they are trained, but I think some are just getting a thrill from putting the pressure on, and speaking down to you.
Few tips.
1. Play the game, humour them, let them think they a scaring you, if you don't have the money DON'T give it them DO NOT make yourself short. Your first priority is to keep you and your family afloat, that includes paying your mortgage and rent on time, food, car, all bills etc. If they ask for a payment and you really can't afford it, there's not alot they can do, sure if you can make a token payment do it, thats what the concumer credit council will advise but if you can't don't worry.
2. Don't give them all your phone numbers, why do you think they want them? So they can hound you, early morning (between 8.30 and 9am is favourite) evenings, weekends etc. I suggest you call them on a withheld number and if you have to give them a number get a pay as you go sim just for this purpose. They will ask if you have a landline, say NO.
3. If you own property DO NOT EVEN THINK ABOUT GETTING A SECURED LOAN to pay off your debts. Forget it, as it stands all your debts are UNSECURED, the very worse thing they can do is take you to court, and if you default on the court judgement (eg I can pay 50 quid a month between my 10 credit cards) then they can apply for a charging order, so the debt will be registered on your property and only when you sell the property will you have to pay them back. Don't quote me, and feel free to correct me, but this is a long way down the line, they will all prefer to keep this out of court and hope your situation improves one day and you can pay them back.
4. Don't tell them anything. I had one woman asking me over and over again what i did for a living, she was from a firm of solicitors employed by the card company. It was like I was in the dock. Your NOT a criminal, not as criminal as their interest rates, if you don't want to listen press the red button on your phone.
5. Get advice from the Consumer Credit Council, I spoke to them and the guys and girls on the phone know there stuff, they will re assure you. I have not had my full 90 minute appointment yet as I'm not sure it's the best way. I don't want to be pushed towards an IVA, and I'm going to take my time and see what happens over the next few months. I owe money to some firms who owe are going to have people calling them up soon asking to be repaid their debts, you'd be annoyed if you paid off one of your cards to a firm that went BUST, even if the do gooder money savers will preach about it being the right thing to do!
6. Chat to people you know who have been in the same situation, I have got a great accountant (and i dont want to get him work, and I am not spamming) who knows the ins and outs, and has advised me well, but his message is the same as mine, don't panic, the worst thing that will happen is you won't be able to get credit for a few years, but that's not a bad thing, and most the world won't be able to either so it's not a big problem!
7. Work out your battle plan and sit tight. I'm intending to start paying them all soon. Some companies will put you on a hardship plan where they freeze the interest, some will keep banging on the interst, but the reality is you will never pay the full debt back, and once you make a few months of regular payments they will freeze it and take off some of the interest. Say you've only got 80 quid (excuse me but this keyboard has no pound sign!) a month and it's split between 12 debts then they have little choice but to accept the 6 pounds a month. If they don't then they may take you to court, and guess what, if you prove in court you are really that skint, and you tell the judge after paying everythng you only have 1 pound a month spare for the company, guess what, they have to accept it.
8. Once your paying your regular figure back, every so often they may write or call you and ask if your financial situation is improving, and of course if it is and you have some spare cash, tell them about it straight away! If you told them you were still struggling then your now INTEREST FREE debt would be paid off quicker?
9. The chances are they will offer you a full and final settlement figure somewhere down the line. Some may not and MAY put a charge on your property, but if your not in a hurry to move house, don't worry. I can only talk from personal experience but one CC company I owe 21000 pounds to has just offered me a figure of 35% of this as full and final settlement. Thats 7350 if my maths is correct for a debt of 21000. AND THEY ARE GOING TO LET ME SPEAD THE PAYMENTS FOR A 10 MONTH PERIOD. Now if some of you have struggled and paid your debts back in full, I'm not sitting here smug, I've done that all my life, and with mortgages and loans I've paid many 1000's in interest over the years. BUT look after number ONE, if these companies sell the debt to a debt collector they will probably buy the debt for 20% to 25% of it's value, they would probably rather have 30% off you.
10. OK you messed up, you didn't really need that 42 inch plasma, or that settee bought on a bank holiday (my cards were actually used for nothing excessive, just trying to keep me and my business afloat) They messed up too, ITS YOUR BIRTHDAY, HAVE A BOOK OF CHEQUES, you've been with us a year, congratulations we've upped your limit, (not your credit limit, your DEBT limit) You just think about you, take a deep breath and PLAN. From experience of my mother who kept the families debts secret from my dad back in the 90's, don't keep it secret. Out in the open, it nearly killed my mum. I'm lucky I'm single and have only got me to answer to. Be honest with the people that matter, tell them the new car will have to wait, they didn't want to go to Florida anyway, ALTON TOWERS (with 2 for one vouchers) is much more fun, and hopefully we will all realise that new cars, food that is not just food, and all the other must haves are really must not bother.
There is much talk about credit agreements being illegal, and there are cases of debts being written off completely. I am going to research this, AND if it is a possible avenue I will NOT FEEL ANY GUILT, and not even read the comments or the MSE 'you got in debt so how about paying them back' Yes I'll pat what I can afford, but if there's a way out I'll take it. In this world of fat cat companies paying million pound bonuses, billionaire oil barrons buying football clubs instead of saving lives (and i'm sure they do there bit, but it is a bit) I'm not going to feel guilty if I pay back much less than I owe if it get's me back on track. If anybody can tell me about their experiences of solicitors and the debt being written off please let me know.
If I've got it wrong and the bayliffs do turn up, I'll post again. If you have made an offer to a specific card company, please post and give us an idea. I know Martin has done 2 videos, first one where you shuffle your debts ands pay the lowest rate first and the second where you are in DEBT CRISIS.
Martin is ace, you have got to love his enthusiasm and knowledge, BUT it isn't CRISIS, unsecured debt is not the end of the world, hope this makes one person worry a little bit less!
I owe 60000 quid, and before the people on this forum judge, ask me how or why, as we all know things happen, things go wrong, and the people who are in debt in here aren't all wreckless consumers who wanted everything and wanted it now, some people just went off course, and if you go slighly off course the interest rates soar and the debts grow quickly.
NOW I get 20 letters a week, 10 phone calls a day, but I have never had anyone visit me in person (infact when I questioned a personal visit with on e company they implied it would be a personal phone call!) Some of the people who call are nasty pieces of work, maybe it's the way they are trained, but I think some are just getting a thrill from putting the pressure on, and speaking down to you.
Few tips.
1. Play the game, humour them, let them think they a scaring you, if you don't have the money DON'T give it them DO NOT make yourself short. Your first priority is to keep you and your family afloat, that includes paying your mortgage and rent on time, food, car, all bills etc. If they ask for a payment and you really can't afford it, there's not alot they can do, sure if you can make a token payment do it, thats what the concumer credit council will advise but if you can't don't worry.
2. Don't give them all your phone numbers, why do you think they want them? So they can hound you, early morning (between 8.30 and 9am is favourite) evenings, weekends etc. I suggest you call them on a withheld number and if you have to give them a number get a pay as you go sim just for this purpose. They will ask if you have a landline, say NO.
3. If you own property DO NOT EVEN THINK ABOUT GETTING A SECURED LOAN to pay off your debts. Forget it, as it stands all your debts are UNSECURED, the very worse thing they can do is take you to court, and if you default on the court judgement (eg I can pay 50 quid a month between my 10 credit cards) then they can apply for a charging order, so the debt will be registered on your property and only when you sell the property will you have to pay them back. Don't quote me, and feel free to correct me, but this is a long way down the line, they will all prefer to keep this out of court and hope your situation improves one day and you can pay them back.
4. Don't tell them anything. I had one woman asking me over and over again what i did for a living, she was from a firm of solicitors employed by the card company. It was like I was in the dock. Your NOT a criminal, not as criminal as their interest rates, if you don't want to listen press the red button on your phone.
5. Get advice from the Consumer Credit Council, I spoke to them and the guys and girls on the phone know there stuff, they will re assure you. I have not had my full 90 minute appointment yet as I'm not sure it's the best way. I don't want to be pushed towards an IVA, and I'm going to take my time and see what happens over the next few months. I owe money to some firms who owe are going to have people calling them up soon asking to be repaid their debts, you'd be annoyed if you paid off one of your cards to a firm that went BUST, even if the do gooder money savers will preach about it being the right thing to do!
6. Chat to people you know who have been in the same situation, I have got a great accountant (and i dont want to get him work, and I am not spamming) who knows the ins and outs, and has advised me well, but his message is the same as mine, don't panic, the worst thing that will happen is you won't be able to get credit for a few years, but that's not a bad thing, and most the world won't be able to either so it's not a big problem!
7. Work out your battle plan and sit tight. I'm intending to start paying them all soon. Some companies will put you on a hardship plan where they freeze the interest, some will keep banging on the interst, but the reality is you will never pay the full debt back, and once you make a few months of regular payments they will freeze it and take off some of the interest. Say you've only got 80 quid (excuse me but this keyboard has no pound sign!) a month and it's split between 12 debts then they have little choice but to accept the 6 pounds a month. If they don't then they may take you to court, and guess what, if you prove in court you are really that skint, and you tell the judge after paying everythng you only have 1 pound a month spare for the company, guess what, they have to accept it.
8. Once your paying your regular figure back, every so often they may write or call you and ask if your financial situation is improving, and of course if it is and you have some spare cash, tell them about it straight away! If you told them you were still struggling then your now INTEREST FREE debt would be paid off quicker?
9. The chances are they will offer you a full and final settlement figure somewhere down the line. Some may not and MAY put a charge on your property, but if your not in a hurry to move house, don't worry. I can only talk from personal experience but one CC company I owe 21000 pounds to has just offered me a figure of 35% of this as full and final settlement. Thats 7350 if my maths is correct for a debt of 21000. AND THEY ARE GOING TO LET ME SPEAD THE PAYMENTS FOR A 10 MONTH PERIOD. Now if some of you have struggled and paid your debts back in full, I'm not sitting here smug, I've done that all my life, and with mortgages and loans I've paid many 1000's in interest over the years. BUT look after number ONE, if these companies sell the debt to a debt collector they will probably buy the debt for 20% to 25% of it's value, they would probably rather have 30% off you.
10. OK you messed up, you didn't really need that 42 inch plasma, or that settee bought on a bank holiday (my cards were actually used for nothing excessive, just trying to keep me and my business afloat) They messed up too, ITS YOUR BIRTHDAY, HAVE A BOOK OF CHEQUES, you've been with us a year, congratulations we've upped your limit, (not your credit limit, your DEBT limit) You just think about you, take a deep breath and PLAN. From experience of my mother who kept the families debts secret from my dad back in the 90's, don't keep it secret. Out in the open, it nearly killed my mum. I'm lucky I'm single and have only got me to answer to. Be honest with the people that matter, tell them the new car will have to wait, they didn't want to go to Florida anyway, ALTON TOWERS (with 2 for one vouchers) is much more fun, and hopefully we will all realise that new cars, food that is not just food, and all the other must haves are really must not bother.
There is much talk about credit agreements being illegal, and there are cases of debts being written off completely. I am going to research this, AND if it is a possible avenue I will NOT FEEL ANY GUILT, and not even read the comments or the MSE 'you got in debt so how about paying them back' Yes I'll pat what I can afford, but if there's a way out I'll take it. In this world of fat cat companies paying million pound bonuses, billionaire oil barrons buying football clubs instead of saving lives (and i'm sure they do there bit, but it is a bit) I'm not going to feel guilty if I pay back much less than I owe if it get's me back on track. If anybody can tell me about their experiences of solicitors and the debt being written off please let me know.
If I've got it wrong and the bayliffs do turn up, I'll post again. If you have made an offer to a specific card company, please post and give us an idea. I know Martin has done 2 videos, first one where you shuffle your debts ands pay the lowest rate first and the second where you are in DEBT CRISIS.
Martin is ace, you have got to love his enthusiasm and knowledge, BUT it isn't CRISIS, unsecured debt is not the end of the world, hope this makes one person worry a little bit less!
0
Comments
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Thank you for this - I now feel slightly less scared than I did a couple of minutes ago!0
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Unless of course that unsecured debt becomes a CCJ which you can't keep the payments up on and it becomes a charging order, or the judge outright agrees to a charging order against your property. Forced sales are rare but they do happen.
I agree that when people think there's nothing that can be done and have gone beyond desperate there are still actions that they can take. Knowledge is power, but nothing is ever certain - especially when bailiffs are knocking on your door. There are alot of people that come to this site scared and with no idea what to do or who to turn to.
I'm glad you've got everything covered and the confidence to face it head-on. As for debts being written off, i'm afraid that only happens if you die and there is nothing from your estate that they can take to cover it. You may however be able to not pay as a debt is unenforcable - then after some time it will become statute barred. Even then though the debt will still exist and some DCA will probably contact you requesting payment of a statute barred debt.
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Details: http://forums.moneysavingexpert.com/showthread.html?t=578486
Template: http://forums.moneysavingexpert.com/showthread.html?p=11636295#post11636295After falling off the gambling wagon (twice): £33,600 (24,000+ 9,600) - Original CC Debt: £7,885.91
Dad Gift 6k ¦ Savings & Inv Tst: £2,500
Loan 10k: £0 ¦ Dad 5.5k: £2,270 ¦ LTSB: £0 ¦ RBS: £0 ¦ Virgin £0 ¦ Egg £0
Total Owed: £2,270 (+6k) 11/08/20110
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