Student in debt

alenax

Admittedly, this is a common occurrence but I'm really fed up with the situation that escalated even though it is completely my fault.

I currently have two student accounts, both with maximum overdrafts, both overdrafts maxed out. I also have two student credit cards with the banks, also maxed out, and a pretty much maxed out store card.

Recently, I've thought about those Ocean Finance etc adverts that entice you to condense your debts into one easily manageable loan, so that instead of paying back into 5 different accounts, I would only be paying back to one company. Is this a viable option? Or would it make more sense to keep paying them separately? I would love to see my balances not in the red...

Many thanks in advance and hello to everyone

edit: I should also add that I have a pretty much full-time job as well as a student loan but I may not be a student for much longer...

yorkshire-lad

Hi and welcome to the boards:D

now im not expert but people will be able to help you more if you put up a SOA (statement of Affairs, i think)

here is the link http://www.makesenseofcards.com/soacalc.html

fill all your details in, and post back then we can get a clearer picture of your situation and be able to advise better

and congrats on dealing with your debts:)

meema

Hi & welcome

I agree with yorkshire lad, put up an soa and you'll get loads of help! However, I can tell you straight away - DO NOT GET A CONSOLIDATING LOAN!!!

Sorry for shouting that out, just don't want you to make the same mistake I made (look at the size of my debt)!!

All that happens when you consolidate is that you free up some more credit for yourself and continue to spend.

alenax

Do I just need to post the summary of that sheet or the summary of monthly income etc?

What's so bad about consolidating loans? I take it the interest rates etc are crazy?

Phaelok

alenax wrote: »

Do I just need to post the summary of that sheet or the summary of monthly income etc?

What's so bad about consolidating loans? I take it the interest rates etc are crazy?

Personally I would consider the cosolidation of all these debts with the company as a last resort. It will affect your credit rating, with external companies normally taking their own 'cut' from the monthly premium you pay. I would go careful with such companies and advise you speak to your own bank.

In some cases bank's are able to offer you a consolidation loan (if a normal loan declines due to your credit rating) where the apr is normally higher and is used to repay internal debt with the bank only. Find out if it would be cheaper to consolidate all these debts whilst comparing it to what you are paying out at the moment.

Just a few thoughts

Stinkybell

alenax wrote: »

Do I just need to post the summary of that sheet or the summary of monthly income etc?

Fill in the whole thing, and there's a format for MSE button. Click on it and post the results back here

And don't panic - I also had 2 student ODs and CCs but didn't consolidate and did some creative shuffling and lots of moneysaving!

alenax

Phaelok wrote: »

Personally I would consider the cosolidation of all these debts with the company as a last resort. It will affect your credit rating, with external companies normally taking their own 'cut' from the monthly premium you pay. I would go careful with such companies and advise you speak to your own bank.

In some cases bank's are able to offer you a consolidation loan (if a normal loan declines due to your credit rating) where the apr is normally higher and is used to repay internal debt with the bank only. Find out if it would be cheaper to consolidate all these debts whilst comparing it to what you are paying out at the moment.

Just a few thoughts

Thanks for your reply

The thing is, I would rather have one loan that paid back all of these overdrafts and cards rather than several, but I doubt a bank would give me a loan to cover all of these, or would it? The fact I'm a student might also be a factor, I'm not sure...

Phaelok

alenax wrote: »

Thanks for your reply

The thing is, I would rather have one loan that paid back all of these overdrafts and cards rather than several, but I doubt a bank would give me a loan to cover all of these, or would it? The fact I'm a student might also be a factor, I'm not sure...

It depends if you are earning a monthly income (if you are working and receiving a weekly/monthly income) If you receiving an income then it is down for the bank to decide if you can afford it (using their assessment criteria). If it saves you money and it strengthens the banks position, and yours, then they would normally look to do it. If you not working then you could always speak with the DMU (Debt Management Unit) within that particular bank with a view to discussing a repayment plan. Just trying to give you all the options - I think using external companies could potentially open a whole can of worms and make your position more vulnerable, short as well as long term.

alenax

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 1
Number of children in household......... 0
Number of cars owned.................... 0

Monthly Income Details
Monthly income after tax................ 1000
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 400
Total monthly income.................... 1400

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 220
Management charge (leasehold property).. 0
Council tax............................. 0
Electricity............................. 20
Gas..................................... 10
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 35
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 50
Clothing................................ 200
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 25
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 20
Haircuts................................ 20
Entertainment........................... 0
Holiday................................. 18
Emergency fund.......................... 0
Beauty treatment........................ 30
Total monthly expenses.................. 648


Assets
Cash.................................... 1000
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 1000

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
Overdraft 1....................1500......10........0
Overdraft 2....................1250......10........0
Credit card 1..................500.......10........0
Store card.....................500.......10........0
Credit card 2..................500.......5.........0
Total unsecured debts..........4250......45........-


Monthly Budget Summary
Total monthly income.................... 1,400
Expenses (including HP & secured debts). 648
Available for debt repayments........... 752
Monthly UNsecured debt repayments....... 45
Amount left after debt repayments....... 707

Personal Balance Sheet Summary
Total assets (things you own)........... 1,000
Total HP & Secured debt................. -0
Total Unsecured debt.................... -4,250
Net Assets.............................. -3,250

Created using the SOA calculator at newbies aren't allowed to post links apparently
Reproduced on Moneysavingexpert with permission, using Firefox browser.

A few notes as well: I'm living in a bedsit atm and the water and Internet rates are included in the rent, have to take it in turns to put electricity and gas on the meter though. I am thinking of moving in with boyfriend though, where I would have to pay half the rent (which is about the same as I'm paying now) and would share the water, gas and Internet bill, and possibly Sky.

Oh, and not sure what the APR on the store card or credit cards are.

urg123

alenax wrote: »

Thanks for your reply

The thing is, I would rather have one loan that paid back all of these overdrafts and cards rather than several, but I doubt a bank would give me a loan to cover all of these, or would it? The fact I'm a student might also be a factor, I'm not sure...

HI Alenax

I understand the wish to have one simple debt to repay but I have seen many on here who have moved their debt in this way and then just carried on spending as they always had done and ended up in a worse position.

It's great that you have realised that this is not a great situation to be in. There is no easy fix, but stay on this site and you will learn loads that will not only get you out of debt know but will put in you a great financial position for the future.

The first piece of advice is to post a Statement of Affairs on here: http://www.makesenseofcards.com/soacalc.html

Then look at what you can do to reduce your debt. This can be switching providers, cutting down on 'naughty' spending, making more money, making your money work harder for you.

Keep posting

urg x

urg123

Looks like we crossed posts.

my initial thoughts are:

1) £200 per month on clothes seems like an awful lot.
2) you have £700 per month to pay off you debt - is this really what you end up with every month? Try keeping a spending diary and write down every single penny that you spend.
3) you have £1000 in cash/savings. Can you use this to help with the debts
4) the general rule of thumb is to pay back the ones with the highest interest asap.

Also, what have you got that you can sell - books on Amazon. OTher stuff on ebay. It can all help to pay off the debts.

Hope this helps

urg x x