What would you do?

in_need_of_advice_4

Hi everyone, brand new member here.

Well, as I guess most new users are I am an a bit of a sticky situation. My debts are now, in my opinion, catastrophically high and I am not earning any money at all. I started my own business (recruitment) 10 months ago, just before the recession really bit, and have not made a penny. I have sunk all of my savings and gone into deep personal debt to keep things going but it looks like it is not going to work in time to save my financial situation. The tricky thing is that my company has the potential to create hice big chunks of money at a moments notice, it has just not happened yet!

Anyway, I see most people lay out their debts here quite openly so I will follow suit.

MBNA Credit Card - £16,000
Barclay Card - £1,700
Amex Blue Card - £700
Unsecured loan at 11% with First Direct - £17,000

I am behind an all of these payments by 3-4 months and I am getting call after call from them demanding payment. First Direct have closed my current account and have told me they are sending a letter demanding payment in full for the loan.

So, in a nutshell I need some advice. Many people have suggested contacting the CCCS and I am planning to do so. My credit rating must be shot by now but I have not yet received a CCJ.

What is the boards collective wisdom on this? A debt plan with CCCS? The main problem is is that I have no earnings at present to guarentee payments, even small ones. Fortunately my wife is still making her salary so we can pay the mortgage which is now a managable £350 a month rather than the £900 it was last year. We will definitely be able to manage the mortgage so that is not an issue.

Any thoughts would be most welcome no matter what they say. I am now very keen to get all of this as sorted as possible.

Thanks.

RAS

Hi

Do you have equity in the house?

Can you get paid work and accept this is a very expensive experiment?

Little_Chicken

Hi there, I would also look to finding a paid role, but still keep your eye on the business if that's what your passion is really for. Unfortunately I am hearing from more and more agencies that firms are recruiting themselves to avoid fees, so I think this might be a while before it picks up. I'm sure someone else will be along in a mo with a link to the SOA so that you can lay down all of your assets, income, expenditure etc. Good Luck.

in_need_of_advice_4

hi there, the equity in the house is some (!) but in this market pretty much inaccessible given that our mortgage provider (Nationwide) will take us off our current product (0.08% over base until November) if we re-mortgage, plus charge us a tidy fee. The equity is probably not more than about 20k anyway on a good day. Suffice to say this is a personal problem and the house is the only real thing of value we (my wife and I) have for the future, whatever that may hold.

I am looking for paid work, interview tomorrow and another next week which is good news. The thing is that I used to be quite a high earner (65k basic) before starting my own form and my monthly debt repayment (c. £1300 on the above) was managable. I will not be able to get that kind of cash basic now, probably half or less, so even if I do I will struggle with each months payments. This is why I was considering CCCS for the credit cards and loan - is this wrong?

RAS

i am assuming that the cards are personal debt not business debts.

If you have equity there is a risk that the larger creditors will go for a charging order. This does require a CCJ which you fail to pay but you will need to fight each step of the way.

if you can get back into work, they are more likely to be reasonable and accept a reduced rate.