Help please - partners hidden CCJ has started an avalanch of misery

StressedEric_3

Hi All,

I wanted to ask advice on what to do next. I am so stressed about our situation. Sorry if this is a bit long to read.

I have 4 Credit cards and an overdraft. The cards have about £39,000 on them and the overdraft is £1,500.

In Feb/Mar this year, I asked our mortgage provider to loan me an additional £40,000 to wipe out the card/od debt but was turned down. My income had reduced then from the time I took out the mortgage (by about 33%), so I assumed it was on that basis. They referred me to a Watford company that could arrange a secured loan.

That company spoke to me and offered about £28,000 at something like 15% over 14 years. I asked why they wouldn't provide the £40,000 and why such a poor rate and they said it was down to a CCJ.

I had no idea about any CCJ, so got hold of my Experian report which was (at that time) clean. All green lights so to speak.

I asked my wife to get her report and about a week later, we discovered that her ex-employer (Leeds City Council) had a judgement against her. She told me that didn't know about this. After investigation, we discovered that they had been chasing an overpayment of salary of about £600.

My wife explained that she had been overpaid one month, but that Leeds CC had clawed back the overpayment the following month. This was back in 2004. After we had moved south, Leeds CC had apparently chased my wife for the payment again. She had initially refused to pay, telling them she owed nothing, but after being harassed, had made two payments of £100, followed up by a final settlement. At this time, my mother-in-law was dying of cancer and my wife paid up just to get rid of the harassment even though she owed nothing to them. She never mentioned this to me at the time.

The CCJ was set up about 3 months after my wife had (unnecessarily) repaid the alleged overpayment.

I believe that the CCJ and repayment should never have happened and that Leeds CC should get the CCJ removed and refund the repayment to my wife with interest.

At the end of March, we made a Data Access requested to Leeds CC to find out what had happened and get evidence for the CCJ to be removed.
A few weeks ago, we received a bunch of photocopied payslips and that's all. No mention of a CCJ being taken out or any other contractual information.

The payslips are very confusing, each month being for a different amount over nearly four years worth of slips. Over two months, where I believe the overpayment and claw-back occurred, there does appear to be one large and one very small payment amount.

So now, I believe we need to apply to a court to get the CCJ set-aside using the payslip evidence as support.

In the mean time, my credit card debt has spiralled and I have missed a number of minimum payments and gone over my overdraft limit. I have managed to keep the mortgage payments up more by luck than judgement. I am paid four weekly which I find a pain, as my pay date moves, so there is never a good fixed day of the month to have payments taken out of my bank.

The o/s mortgage stands at less than 50% of the house value (taking a very conservative estimate of it's value) and the additional £40,000 would push that up to just under 65% of the value.

last week, I went to the bank holding our mortgage to ask for more advice on what to do for the best. The advisor recommended extending the mortgage as the cheapest way getting our finances back on track. He thought that as the CCJ was unjustified, he would be able to get around this. Yesterday, he called me and said that due to the CCJ and now the missed payments and arrears accrued since it was discovered, they would be unable to lend me any more.

I have just had a backdated pay rise equating to about £250 take home per month (which will hit my account on 25th July) and give me about £680 extra this period. My wife's pay will change from being for 38 weeks out of 52 (she does not get paid out of term time as a High Level Teaching Assistant) to full time in September, so she will also be earning about £260 more each month. We can easily afford to extend the mortgage if all of the other monthly payments disappear. I would get rid of almost all of my credit cards if I was able to clear them down, just keeping one for monthly expenses (fuel & food) and one for emergencies (car / house repairs), say £4000 in total as opposed to the £40,000 total limit I have now..

OK - there's the background...

Can anyone suggest how to proceed?

1) What is the process for getting the CCJ set aside?
2) Can we make any claim against Leeds CC for mishandling of personal data (had they not incorrectly set up the CCJ, we would have had the additional money on the mortgage that we cannot now get to to the arrears that has happened since) I believe that this has had a fundamental impact on our credit worthiness and possibly ruined us for years to come.
3) If the bank cannot come up with the additional funds, where should I look next?
4) One Credit card needs AT LEAST £950 paid in the next 10 days to remove a default notice - so I need to move fast.

In advance - thanks and I appreciate your advice.

Ames

I can't help you with the CCJ stuff, but please think again about changing your mortgage. It's a really bad idea to change unsecured debt into secured. If something goes wrong you could lose your house. Also, if you do that and then need to claim benefits, they wont cover the extra mortgage if it was taken out to clear debts.

RAS

here is your starting point for your CCJ

http://www.nationaldebtline.co.uk/england_wales/factsheet.php?page=12_how_to_set_aside_a_judgment_in_the_county_court

I suggest you also look at www.leeds.gov.uk and raise a formal complaint with them. If they do not make a satsifactory response, then you can escalate to teh Local Authority Ombudsman.

Securing debt is not a good idea by the way.

To avoid the default, try to speak to them and negoitiate what you can.

Do you have a credit union www.abcul.org.uk ?

dancingfairy

Even without the CCJ 40k is a huge amount to borrow and they still might not have wanted to lend to you - after all what would then stop you paying off your credit cards and then building then back up again and then you'd owe 80k which would leave the company that lent you 40k at risk of not getting their money back.
Would you lend someone 40k if they owed 40k already?
I think you need to address the root of the problem - 40k is a lot of debt.
As Ames said you transfer that money onto your house and then
1) you could be at risk of loosing your house
2) you end up paying the banks an awful lot more over the longer term.
3) you then could be tempted with all these nice empty credit cards and start spending again (I'm not saying you would but it seems to be awfully common).

Best thing to do would be to post an SOA see the thread for new people and take it from there.
Oh and approach CCCS or your local CAB or phone National Debtline for free impartial advice on the best way forward.
Start a spending diary and really check out whether you are getting the best deal from all your insurances/utilities etc and work out whether bills are essentials or luxuries.
Now would be a good time to make a start on tackling your debts as if one of you were to get ill or loose their job you could end up in a right mess - and if you can get things sorted those pay rises could be yours to spend rather than lining the banks pockets - imagine how good that would be.

Good Luck with sorting it all out.

df

tasha-debt

Ok I think you need to call one of the debt charities for help (CCs and Payplan I think are the free ones) as you need to start taking action ASAP.

For the short term can you increase your overdraft and then arrange a re-payment plan with the bank to clear the £950.

If you do manage to find a loan for the £40,000 (unsecured) what would stop you spending on the cards again, why would you need to keep the fuel and food card, can you not use cash and also put money up every month to pay for car things?

I would also put up a statement of your affairs to see if people can help you cut back in other areas.

Tasha

StressedEric_3

Hi Ames, RAS, dancingfairy and tasha-debt.

Thanks for the replies so far :T !

My debt started with lending a business partner £6k to pay some temp employees after a failed business start up (he was selling his house & was going to pay me back with the proceeds). He disappeared after taking the money. (STRIKE 1)

I took a sales job travelling north England & Scotland for about 3 months. I put my expenses on my cards and ran my own car. When I went down to London to ask where my reimbursement and salary was, I met the receptionist trying to get into the offices. The owner had taken off with the money and disappeared abroad! (STRIKE 2). Another £8k on the cards. (£14K so far)

RBS Advanta (MINT) didn't cancel the payment insurance when asked them to (and I didn't read my statements to spot this). (STRIKE 3). Another £4k+ over time on the cards! OUCH! (£18K+ now)

Got married (Yay!) but had to do this in a hurry, as my wifes mother was dying and we wanted to make sure she was there. Hit the cards with another £12K+ (over £30K now)

This was over 2 years ago. The rest has been interest and some essential repairs to the car and new central heating.

I don't want to use the credit cards for any more borrowing once I have paid them off - just to start building a new good credit record. My usual petrol would be about £200 & food £100. I would want to put these on a card and pay them back every month in full. Then I wanted to have a facility to sort the car and house again in a hurry. We have been caught once without heating over winter and it wasn't funny. I know now this would set us back about £3K to have a boiler replaced. My car is worth more to me than anyone would pay me for it, so I am keeping it going. It is going to need about £800 of work to get it through the next 20,000 miles and pass it's MOT. It is these reasons why I wanted to reduce my available Credit card balances from £40K+ to £4k. One £1k and one £3K card. The £3K card would be used rarely to keep it going (for the odd fuel purchase) and would be kept for emergencies. The £1K card should cover monthly essentials and the car. Both would be paid off monthly, unless the emergency card was needed, then I would aim to repay that alone within 6 months.

So, I don't want an additional £40K on top of the £40K+ I have, it would be to pay that off.

Do you think I am being practical or stupid (you can be brutal with me).
I don't want to avoid the debts (apart from perhaps that taken to pay the RBS PPI which makes me mad :mad:) and I just want to make the payments affordable so I can sleep nights. Not done much of that lately!

Cheers

RAS

StressedEric wrote: »

RBS Advanta (MINT) didn't cancel the payment insurance when asked them to (and I didn't read my statements to spot this). (STRIKE 3). Another £4k+ over time on the cards! OUCH! (£18K+ now)

Unless this payment insurance has paid out sometime, you need to start reclaiming ALL the payments in the last 6 years not just those they forgot to cancel. See http://www.moneysavingexpert.com/reclaim/ppi-loan-insurance

dancingfairy

Fair enough- it sounds like you have had a very rough ride.
In theory your idea of getting a loan so you would have lower payments makes sense but I just don't think with or without a CCJ you will be able to borrow that amount of money.
I think my first post was a bit harsh so I'm sorry if it came across that way.
I would definitely pop up an SOA to see if there are any savings to be made and I would also get in touch with one of the debt organisations (the free ones of course).
There are several options you can explore - a debt management plan (DMP) where you pay all your essential outgoings eg electric/mortgage/water/food and then what's left get's divided up fairly between your creditors each month and you ask them to stop interest and charges so you are able to lower the amount of debt you are in. Obviously your credit rating would take a hit but if you are unable to meet your monthly minimums then unless you can increase your income and/or decrease your outgoings then you will start to miss payments anyway.
IVA or bankruptcy - I don't know much about these but if they are things which might help have a read on the bankruptcy board and see what it entails- obviously bankruptcy is a last resort but it may be worth looking at.
You might also be able to shift the debts around if you have any spare capacity on any cards and trasnfer higher rate debts to lower ones but without having more detail it is difficult to advise further.
The only way I can think of to get the 950 pounds without getting more credit would be to sell everything you can? Although I am not sure this would get the default removed? maybe it would show as late rather than a default -I am not really sure on how this works to be honest.

Good Luck with trying to sort it all out.
df