MBNA reduced repayments help

misstree_2

I recently went to the C.A.B to get advice on lowering my monthly payments to MBNA. I owe a little under £9000 and my monthly payments go from anything from £115 - £145. I no longer have a card and haven't since back last year sometime. My monthly payment is barely covering..or even not, the interest that goes on monthly.

The advice I was given was to do an income and expenditure form and to contact them with an offer. I have done this and have offered them £50 per month. I received a letter back, asking me to telephone them to discuss this further, which I did about an hour ago.

This is what I sent them..

Please note, all calulations will be based on monthly figures.
Incomings
Incapacity and DLA benefit - £551.00

Outgoings

Council Tax - 30.00
Water rates - 30.00
Gas - 30.00
Electicity - 40.00
Builings and Contents
Insurance - 30.00

Phone - 15.00
Travel/Petrol - 30.00
Catalogues - 56.00
Other Credit Cards - 16.00
Housekeeping/
Shopping - 160.00
Other/Loan - 60.00
TOTAL - 497.00
__________________________
Income - £551.00
Ougoings 497.00
Bal left £54.00
This is an accurate record of my financial position on 10 May 09.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

The guy I spoke to went through the figures and asked for more info on how I've been managing to make the payments. I told him that the last few months I've been borrowing money from family and friends to make up the payments, but I can't do this any longer. He asked eactly how much I borrowed, how much I repay and how often. I couldn't give him a clear answer as it differs, and sometimes I can't afford to pay a certain amount.

He recalculated and got a figure of £365 and said that I could afford to pay in the region of £100 per month! I know that this is impossible, and can't even see where the figure he got came from. He confused me so much that I agreed to take another look at my finances and see if there's anything I haven't put down. He also said that I need to be more specific with the 'other/loans' part and that if I go out socialising that I need an exact figure. My needs will obviously differ slightly from month to month, like if an emergency of some kind comes up.

I really don't know how to proceed now, and am feeling so stressed and low from the phonecall. I am a grown woman sitting here almost in tears with fear of this company, which is ridiculous!
I need to ring them back withen the next couple of days with some sort of better offer?

What can I do?

I've had trouble with them before so am used to them being not very understanding. There's a link to an old thread of mine below, if anyones's interested.


http://forums.moneysavingexpert.com/showthread.html?t=693041

Degenerate

misstree wrote: »

Please note, all calulations will be based on monthly figures.
Incomings
Incapacity and DLA benefit - £551.00

Outgoings

Council Tax - 30.00
Water rates - 30.00
Gas - 30.00
Electicity - 40.00
Builings and Contents
Insurance - 30.00

If you're on incapacity and DLA benefits, surely you're entitled to full Council tax benefit?

RobertoMoir

misstree wrote: »

He confused me so much that I agreed to take another look at my finances and see if there's anything I haven't put down. He also said that I need to be more specific with the 'other/loans' part and that if I go out socialising that I need an exact figure. My needs will obviously differ slightly from month to month, like if an emergency of some kind comes up.

In general terms, this isn't bad advice. I'm not sure I agree with their claims about what you can afford but going through your finances carefully, and being more specific about your "others" figures and setting aside a budget for socialising are in my opinion essential for someone who is struggling with bills. As is following the point Degenerate alludes to and making absolutely sure you're claiming every benefit you're entitled to.

You should do that for yourself so you can take control of your finances and decide what you can afford to pay them, not the other way around.

You might look at the templates for a full Statement Of Affairs on the debt free wannabe part of the site, fill one in and post it there for help, they are demons at working this kind of thing out.

misstree wrote: »

I really don't know how to proceed now, and am feeling so stressed and low from the phonecall. I am a grown woman sitting here almost in tears with fear of this company, which is ridiculous!
I need to ring them back withen the next couple of days with some sort of better offer?

You have nothing to fear from this company. Sure, your credit score might not look too sharp but how bad is that really? They can't make you pay what you don't have. they can't randomly turn up and take your stuff (no matter what they might claim. I'm a former bailiff, I probably know better than them who can and who can not turn up and take people's stuff and under what circumstances).

If they don't like what you can afford and they take you to court, you can demonstrate to the judge that you've gone through your finances and offered what you can afford to pay the debt off best you can, no more and no less, and they'll probably say "that's fine".

You do need to take this seriously and I can tell you already are, but it isn't like they have the power to leave you squatting in a ditch with only berries picked from the side of the road to eat if they don't like what you say.

One more thing. I strongly suggest dealing with them in writing and writing alone.
They can't bully you via a letter so easily, and any agreements and offers will be in writing so both you and they can easily refer to them later should there be an issue.

Remember... YOU are in control of your life.. THEY are not.

misstree_2

Degenerate wrote: »

If you're on incapacity and DLA benefits, surely you're entitled to full Council tax benefit?

As far as I know, it's only people who are on Income Support that get full benefit. It's the same with nhs costs, I have to pay so much towards dental treatment etc.

robbo990

AFAIK if you are entitled to the Middle or Higher Rates of the Care Component this could entitle you to the Disability Premiums (Disability/Enhanced and Severe) - which would be paid as an Income Support Top Up - which in turn would give you an entitlement to Council Tax Benefit.

misstree_2

"RobertoMoir" - Thanks, I appreciate everything you said.

I've not had much chance to do some serious 'sitting down thinking' about this today, but I will definately put this as my top priority over the next day or two. I have tried messing around with the figures briefly though and as far as my 'housekeeping' and 'other' figures are concerned then they can differ. The former mainly for groceries and the latter for repaying family etc. I've not really taken into account my tobacco expenses and also socialising...which is very rare these days anyway. I obviously do a lot of 'robbing Peter to pay Paul' but even so, there's only so much that can be done of that, before it all catches up with a person.
I'm still baffled by the their figures and why/how they they come to £365 when my total was £497 - that's a difference of £132! If I had that spare then I wouldnt've felt the need to go through this process with them! I will definately look at that tommorrow and see if I can find what they mean.
Getting in touch by letter does sound very appealing, but I feel that time is of the essence, this months payment is due tommorrow and I don't know what to do about that as I certainly haven't got the full min payment they want.
I will see if I can find the section you mentioned too.

I know that if I can get the help and repayment I've asked for, I will be much better off at paying my other debts and on time.

robbo990AFAIK if you are entitled to the Middle or Higher Rates of the Care Component this could entitle you to the Disability Premiums (Disability/Enhanced and Severe) - which would be paid as an Income Support Top Up - which in turn would give you an entitlement to Council Tax Benefit.

Unfortunately, I get the lower rates. Thanks anyway.

misstree_2

Haven't been very well today and wasn't up to tackling this, however as this was my due date to make my min payment, I thought I'd better do something.
I knew that I couldn't pay them what they wanted but thought I would at least pay the £50, which is the payment I want them to accept as a reduced payment.
I rang up, said I would like to pay £50 and was told that there would still be an outstanding amount. I told him I was in negotiations with them, but would rather pay something than nothing at all. I then very foolishly allowed myself to be drawn into a conversation regarding this.
He asked me twice why I thought the cost of living had affected me and even though I didn't state that the £160 per month was entirely for groceries he told me that he could afford to support his family, very well on £40 per week!
He kept bringing up this figure of £132 that I had 'spare'? When I asked him to explain what those figures were and where they had come from, he couldn't give me a direct reply but just said that MBNA had obviously decided that there was something in my figures that they weren't statisfied with and that I should state what those figures were for. I understand about the other/loans' part but that figure still doesn't correspond.
The conversation was getting out of hand and I felt that he was patronising in his speech. I could go on and on with more explanation of what was said, but this thread was specifically a cry for help not an outlet for a rant, so I apologise.

To summarise, basically he refused to accept my payment even when I said that I felt it better to offer something than nothing at all, until this was sorted out. I said that I had wanted to avoid receiving nasty letters, but he said that I will get nasty letters anyway (those were his actual words).
He told me that I must write to all my creditors and offer proposals, I replied that this was my biggest and most worrying debt, and I wanted to try and come to some arrangement with them first, but he said that I couldn't do that and must do the same with everyone!

I ended the call saying that I had contacted them asking for help, but always ended up feeling intimidated and bullied. I was literally shaking when I put the phone down.

I have definately learnt my lesson now and won't be having contact via telephone again.

never-in-doubt

misstree wrote:

MBNA Problems

Have a look at: http://www.entitledto.co.uk/

This will tell you exactly what benefits you are allowed. Regards to this MBNA debt, personally and for your own peace of mind i'd seriously consider giving them the 'Vs' and going down the 'account in dispute' leading to 'unenforceability' route as MBNA use this 'pressure technique' to force people into making payments knowing deep down that they probably aren't liable anyway!

Bottom line is that your credit file will be a mess for the next few years due to the late payments/account defaults and so unenforceability/refusal to pay may be the best option.

Others will disagree but personally, this is what i'd be doing. For £9k that you'll be paying for the next 10+ years - forget it and in 6 you'll be debt free and able to start again.

If you need specifics PM me and i'll be happy to help.

misstree_2

Thanks for the link, never-in-doubt, I will check it out but I really don't think there are any other benefits I'm entitled to.

This morning I rang C.A.B to make an app..they were busy but on the answerphone was a number to contact a 'Community Legal Advice' helpline. I rang them and spoke to a number of people and basically was told that they could only help me if I want to consolidate all my debts into one. I didn't really want to do this as I was hoping (now I'm wondering if I've been very naive about this), that I could come to some arrangement with them to lower my my repayments. I was told that if they see that I'm paying other creditors more than them then they can enforce some sort of action towards me.

I'm still unsure of what to do about the now overdue monthly payment. As I said, I can't meet it in full and tried to pay a lesser amount yesterday, but they wouldnt' accept it. If I don't pay anything then surely that's worse? I might just pop a cheque in the post, or the other alternative is to see if I can borrow some more money off family to help, to get through this month at least...but I really don't want to do this.

I was also told that if I don't pay them anything that they can apply for a court order which could also lead to them enforcing bankruptcy on me - that has scared the living daylights out of me! I don't know much about this, or even if it's a sensible option.

The annoying thing is that this account was primarily Bank of Scotland initially but for some reason about 7 years ago, was transferred to MBNA. I would never have willingly even contemplated having anything to do with them.

I wish I knew what to do for the best...I need a miracle!

RobertoMoir

misstree wrote: »

Thanks for the link, never-in-doubt, I will check it out but I really don't think there are any other benefits I'm entitled to.

This morning I rang C.A.B to make an app..they were busy but on the answerphone was a number to contact a 'Community Legal Advice' helpline. I rang them and spoke to a number of people and basically was told that they could only help me if I want to consolidate all my debts into one. I didn't really want to do this as I was hoping (now I'm wondering if I've been very naive about this), that I could come to some arrangement with them to lower my my repayments. I was told that if they see that I'm paying other creditors more than them then they can enforce some sort of action towards me.

I'm still unsure of what to do about the now overdue monthly payment. As I said, I can't meet it in full and tried to pay a lesser amount yesterday, but they wouldnt' accept it. If I don't pay anything then surely that's worse? I might just pop a cheque in the post, or the other alternative is to see if I can borrow some more money off family to help, to get through this month at least...but I really don't want to do this.

I was also told that if I don't pay them anything that they can apply for a court order which could also lead to them enforcing bankruptcy on me - that has scared the living daylights out of me! I don't know much about this, or even if it's a sensible option.

The annoying thing is that this account was primarily Bank of Scotland initially but for some reason about 7 years ago, was transferred to MBNA. I would never have willingly even contemplated having anything to do with them.

I wish I knew what to do for the best...I need a miracle!

I can only repeat my advice to post this in the Debt Free Wannabe boards. I keep an eye on things there when I can and for in my opinion it is a good place with a lot of people who have been in your situation and many much worse, but who have or are in the process of getting out of it again. Don't want to sound like I'm badgering you to do it but this board is more for people to discuss various credit cards and you have a problem with a debt that just happens to be with a credit card company, if you see what I mean.

The regulars there have access to templates for the sort of letters you need to send to this creditor and also ideas about debt management and that kind of thing. It's up to you what you do of course but you'll get the best advice there that you'll get anywhere on this website I am sure of that.

Moving on to what else has happened... I'm not personally a fan of debt consolidation loans because this is reducing your debts by taking on more debt (a new loan). I guess there's always some situations where it really might help but to me it sounds a lot like fighting a fire with a bucket of petrol.

As for court action and bankruptcy - that's certainly an option I suppose, but making you bankrupt wouldn't get them their money if you didn't have it to give in the first place so they're actually just throwing around the threat because they know that most people are scared of the idea of going bankrupt (while certainly a very serious matter that shouldn't be considered lightly, it's nowhere near as bad as some of the 'legends' you hear about it and if someone is in a big enough mess it can actually cause an improvement to their situation). Don't forget about that because it is possible, but in some ways it isn't an immediate threat. It won't happen tomorrow or anything like that.

If you start dealing with them by post and keep paying whatever you can manage by cheques, you have a record of what you have and have not paid, and what has been said by both sides, and in the event this does end up in a court you will be able to prove to the judge that you have done your best to pay the debt as well as you can.

jd87

I suppose what MBNA are getting at is two things:

1. "Housekeeping/Shopping - 160.00" - That's quite a lot isn't it? Can't you survive on less?

2. The guy on the phone mentioned that you need to speak to all of your creditors are arrange repayment plans with all of them. Its only fair that you do this. It's not fair on MBNA if you keep making full payments to everyone else and a lower payment to them.

Something else I would point out is that your gas and electric bill is quite high.