What The Hell Am I To Do

bobbiebob

Hi guys, some help and advice would be much appreciated as I'm up the creek without a boat never mind the bloody paddle.

Current Debt Situation:

Its breaking my back, I've sold virtually every asset (DVD & Golf Club) I have on eBay to keep up with payments but I now have just two months of cash left for C.Card payments before i hit rock bottom.

So I reckon I have few options all of which look bad to me but what would you guys recomend.

1) I contact a debt management company to try to help - Can you Recommend any and does this not screw your life up totally..?
2) I approach the c.card and Tesco myself and simply say I cannot afford the debt - What reaction does this provoke..?
3) I go to a company like First Choice Never Never and get a huge £35 - £40k secured loan on my house over 25 years to reduce payments..?
4) I approach my Mortgage company to see if there is more money they will relaease verus my houses value

God I feel sick now looking at that, and my missus is just not aware of the dire situation we are in..

Help Guys advice anything please..!

Little_Miss_Winner

Hi Bobbie,

First of all, welcome to mse!
Second....take a deep breath.

You will need to provide us with a list of all your incomings & outgoings (soa), so that we can look at ways you cash free up extra cash.

The only way to clear debt obvious though I know, is to earn more and spend less.

Can you take on another job, reduce what you spend now?

Re your questions.
1) Payplan are very good I believe, theres loads of encouraging posts on these boards, and they are free to use, and sort all your debtors for you. Takes the weight from you and you pay one monthly sum to them to clear your debts (this is what i believe, if my view is wrong, please someone correct)
2) Worth a try?.....?
3) NO, NO, NO.......You will be securing your house, and you can't afford to lose that!
4) NO, You will end up in a viscous circle.

But first post your soa.

Keep posting!
pot

tyllwyd

Its not easy for people to give you sensible advice unless you give us the full picture - would you be able to post your soa (statement of affairs - ie your monthly budget versus you and your wife's income). That way people might be able to suggest ways you could save money to throw at the debts. How did they get run up in the first place - was it just overspending, or were there specific reasons? If it was overspending, you need to recognise that and do something about it or no matter what you will end up in the same situation again in a few years time.

keith_lard

Contact CCCS you will never look back only forward!


Regards

K.

davek1

Hi Bobbie

right firstly you have to do something and you recognise that otherwise you wouldn't be here.

secondly in my view you have only 2 options not 3 DO NOT TAKE OUT A SECURED LOAN NEVER NEVER NEVER ( i know to my personal cost)

Option 1: re-jig your mortgage to relase equity in the property, although this is adding debt to debt ( not to be recommended)

2: start a debt management plan with either CCCS or Payplan both are free charities, non-judgemental and very helpful. i am with Payplan and to be honest i think they respond quicker than CCCS as CCCS are just so busy.

Once you ring Payplan they will call you back at an arranged time and will want all your financial information so make sure you have it to hand, inc account numbers, amounts outstanding etc. Income details as well.

Assuming payplan agree to represent you ( highly unlikely they wont) write to your creditors telling them you will be making token payments of £10 each to them for the immidiate future until payplan arrange a DMp with them.

Yes a DMP screws you fin respect of your credit rating but truthfully arent you going to be in that posiiton anyway if you cant pay?

look after number one first and pay what you can afford via Payplan who are funded by credit companies so very respected. please do not even contemplate going to a fee paying organisation who will charge ridiculous amounts for work that can be done for free.

Happy to chat mate if it helps just private message me.

Good luck

Dave

Nenen

Hi Bobbiebob
Well, if it's any consolation you are now in a similar situation to one my dh and I got into about 8 or 9 years ago and I can remember the feelings of panic only too well! You have made the most courageous and difficult step of all by admitting to yourself (let alone anyone else) just how difficult things are for you.

Maybe it would help a bit if I briefly outlined what happened to us and how we have almost turned things around. At that time, we had debts to credit cards and banks of over £50,000 plus a maxed out mortgage of over £130,000 (and bearing in mind this was 8 years ago house prices have gone up considerably since then). My dh almost had a breakdown over it, so awful did he feel. He has the terrible burden of having a macho/provider streak left over in what is otherwise a very 'new man' and felt aghast that he couldn't 'provide' for his family (at the time we had 3 fairly young children and I was working part time). When I finally got my head out of the sand (and I think that most people getting into deep debt put their head and often whole bodies in the deepest sand they can find) and acknowledged just how bad things were I took a very deep breath and went to the dear old Citizens Advice Bureau. They were FANTASTIC! Without any recriminations or judgment (and I think we do enough beating ourselves up about getting into this mess in the first place to need anyone else to add to it) they calmly advised us, holding our hands every step of the way! We had to make an appointment to see their specially trained debt advisor and he was brilliant. Of course it wasn't easy, we had to be totally honest about our incomings and outgoings and make a lot of sacrifices. They helped us by working out a budget that they thought would appease out creditors... they know what a court would be likely to deem 'reasonable expenditure' if any of our creditors tried to recover their money like that and by working on that principle and writing to all our creditors on our behalf (we had to sign to let them negotiate for us) they could point out that the creditors would not get any more money by taking us to court and would just incur extra fees. What they did was work out what a court would be likely to allow us to spend on essentials (food, housing, utilities, clothes etc), deduct that from our incomings and then what was left over each month was divided pro rata on amount owed and offered to all our creditors.

All of our creditors accepted this and many even stopped adding interest payments at Citizens Advice request. Of course it meant that we had to cut up all our credit cards and could only spend what we had agreed each month. It was VERY hard to get used to having to stick to a budget and scary at times too as there was nowhere to get extra money when things went wrong (for example when the car we needed for work broke down we didn’t have the money to repair it straight away and obviously couldn’t borrow from anywhere). However, we gradually got used to it. It did mean we got a bad credit record but at least we never actually defaulted and got taken to court or lost our house. The other good thing was that when our creditors passed the debts on to debt collecting agencies (I think that’s what they usually do when you are in this situation) Citizens Advice dealt with them too for us and kept the worst of it off our backs! Because Citizens Advice is such a well known and respected organisation all our creditors were good about dealing with them and doing what they suggested. We had to have regular update meetings with our advisor too.

At first it felt as if we could never recover from this. Now, 8 years on, nearly all of our debts have been cleared, we have learnt a very valuable lesson and our marriage is all the stronger for beating this problem together. I often think it’s a bit like overeating and putting on weight and then having to diet… overeating is sooooooooo easy to do and then we feel so ashamed when we look in the mirror. Dieting is hell… but the rewards are worth it when we can stick to the diet! I still have some regrets… wish I could turn the clock back and not overspend in the first place… it’s taken us 8 years (with another 2 to go to be completely debt free other than mortgage). I wish we could give more financial support to our eldest 2 children who are now at university and of course are not eligible for any government support because on paper income alone my dh and I earn too much, debts and mortgage are not allowed for. However, they are extremely hardworking and appreciative of all they have… far more so than many of their friends who have things far easier!

So the long and the short of it is MAKE AN APPOINTMENT TO SEE YOUR NEAREST CITIZENS ADVICE DEBT ADVISOR!
Very best of luck
Take care and remember at the end of the day your relationships and health are FAR more important than money!
Nenen

oops_a_daisy

Hi BobbieBob - welcome to MSE and the DFW boards. You really have come to the right place for advice. I have pasted a link to a Statement Of Affairs ( SOA ) which will give everybody on here all of the information that they need to give advice. http://forums.moneysavingexpert.com/showthread.html?t=107280

Good luck

scheming_gypsy

davek1 wrote:

Option 1: re-jig your mortgage to relase equity in the property, although this is adding debt to debt ( not to be recommended)

This is something i don't always agree with. He's paying out £750 a month in loans and credit card payments. By adding it to his mortgage he can reduce his mortgage term and be 100% debt free in a lot less time.
He can pay an additional £400 a month off his mortgage and be £350 a month better off than he is now.

queenofthedump

post your soa forst the guys and girls here may be able to help and then you can see if you can do anything without going to DMP we thought that was our only option but 3 months later we are kicking !!!!!! on paying the debt off and still not had to go down the dmp road as according to them we would be debt free in 7 years well we will be anyway

oops_a_daisy

Im not sure from you posts but have you and your OH sat down and discussed this ? I really think you both need to work through this together - it will be a lot easier. On the other hand you really shouldnt take any advice like this from a single mum LOL

livinginhope

Hi Bobbie bob
We recently started a debt management plan with payplan,they will take all your debts and those of your wife and put them into the same plan.You should have enough money to live on as EVERY expense needed is taken into account,so you shouldn't get caught out.You won't have loads to play with just enough.I think some of the debt gets written off if you go for an IVA not a DMP,someone else will know this
You wouldn't be bankrupt on a DMP or IVA,but you will get default notices that stay on your file for 6 years from the date of issue,not such a bad thing as you won't be able to get credit,therefore stay out of trouble.Have to say although I get moments of terror and panic,it's thousands times better than before we contacted Payplan.
Good Luck and make that call to Payplan or CCCS