Not sure about this - sounds too good to be true

Konamb212

Hope someone can help me out here, even though I'm not exactly sure what I could be letting myself in for (just yet)

I've had a cold call from a company in Manchester, offering to reduce my monthly outgoings,
We have 2 CCs with vanquis with balances of £2500 on each card (54% APR):mad:
and an unsecured blackhorse loan taken out in Feb09 for £7500 (?17%APR)
we pay approximately, per month, £250 between the 2 cards (which is just around minimum), and £215 fixed to BH (42 months remaining)
This outfit reckon that they can get my interst and charges frozen and my outgoings reduced to £300 pcm, and I would be debt free in about 3 1/2 years.
They tell me its not an IVA, and details are in the post tonight, so I should have them Monday at the latest. They have told me not to pay the direct debits due at the start of the month to the debts, that they would sort it out.

Anyway this sounds very tempting. I work in the health service and my trust is apparently considering a blanket ban on overtimedue to "efficiency savings", and I need 4 shifts of O/T permonth to break even with everything.
Is this arrangement (whatever it is) going to affect my credit rating ? They say it wont - but then again the dentist tells you it wont hurt either.
My thoinking is that I am bound by the credit agreements I signed and so it would affect my credit rating, and this is something that I do not want to do, especially since my fixed deal mortgage is up in Jan 2010, and I dont want to find that I cannot move.

Sorry that I am a bit vague on the details of what exactly it is on offer to me, but your thoughts on it would be appreciated.

property.advert

This is a cold call. That should make you jump. Obviously it is some sort of management plan where you pay them, they take a chunk out of it and pass the remainder on. Only way they can make money. Bin them off.

Pay your direct debits. Don't listen to them.

If you could get rid of your £5000 at 54% for 25% then your repayments would go down by about £100 a month. But, as you went with Black Horse and have Vanquis, then I'm guessing your credit rating is quite low. That probably means your options for switching are limited.

I'm sorry but I don't see much room for manoeuvre. Whilst staying within your agreements, there is nothing you can do with the loan. Unless you've been peppering applications for credit, is your last one the loan from over 6 months ago ? If so, get an application in for a decent but not top of the line card. You can get an indication on Barclaycard and a couple of other sites at the moment before you apply.

If you got a better card, you can transfer some from those killer Vanquis rates and even if you cannot transfer all of it, you can use any spare to reduce what is left.

If you just cannot go on, then it is a different story. As you are worried about that, have you prepared an income and expenditure statement to see just where your money is going ? Maybe start there. Best of luck.

thefoolonthehill

hi, please ignore these people

if you are struggling to meet your repayments speak to cccs or payplan or call the national debtline. they will be able to look at your I&E and advise what is the best course of action for you to take.

This thread has me wondering - how do these companies get the phone numbers of people who are struggling with debt? surely there is some form of data protection law being broken somewhere

ladybez

I'm no expert but gut feeling is DO NOT TOUCH WITH BARGEPOLE. Alot of companies are promising the earth to people who are struggling and some of them then find themselves in a worse position with defaults etc registered, plus a percentage of each monthly payment going towards the companies charges for arranging this. If you are having difficulties, perhaps you would consider posting up a "SOA" (see first "sticky") and people on here will help you to sort yourself out. Good luck with whatever you decide to do.

gilligansyle

Presumably this company will charge you for this service?

They are doing nothing for you that you can't do yourself or with the help of a free service, CCCS Payplan or CAB.

You may be struggling at the moment but they are now asking you to default; most lenders will understand if you need to make reduced payments.

Please post an SOA and people will be able to help with expenditure and other tips.

tallyhoh

Echo the posters above. This board is littered with casualties of these companies, they find theirselves paying chunks of money to them with little results sometimes.
The company "from Manchester" can only do what you can do yourself with a little help.
Post your SOA & the people here will tell you the next step.

fermi

Konamb212 wrote: »

My thoinking is that I am bound by the credit agreements I signed and so it would affect my credit rating, and this is something that I do not want to do, especially since my fixed deal mortgage is up in Jan 2010, and I dont want to find that I cannot move.

If you don't meet your contractual payments, then it certainly will.

This is a DMP they are offering. Even if they freeze interest and charges (debatable) then creditors are likely to default you. Very bad on your credit files.

AS said, if your situation is such that you need to make an arrangement like this, then CCCS, Payplan, NDL or even the CAB can help you do it for free. Usually with better results than a fee charging company as well.

If you haven't already, then post an SOA on the board. People will help you make the most of what you can to pay off debts sooner.

Konamb212

Thank you all for your replies, much appreciated.

I must admit that I have been very foolish in the past financially, and it was only when I read (I think on here) about what I did previously, which was to consolidate the credit cards, then, thinking I had money, ran up a bill on them again, so compounding the problem..

This Debt management company call left me wondering how this was possible to "freeze" interest without affecting my credit score (admitedly I didnt give a toss about my CS in the past, but after being reckless with my finances I am jealously guarding my score and have been working this past 4 years to keeping it clean)

On another front my wife has just gotten another 10 hours at work, temporary till June 2010 which will ease the pressure a bit.
I have taken the first steps today, and cut up both credit cards, and aim to pay any extra I have to them - I looked at the repayment calculator and was amazed at how even £20 extra a month can make to the total paid, and the time to pay it.
I am also going to get in touch with Vanquis to see if they would consider moving me to a lower interest rate,
failing that I may consider consolidating with Blac horse for another £5k to clear the cards, at least it would be at around 18% APR and not 54%, paying over 4 years would bring my monthly outgoings down £80.

My problem is that I am managing at the moment with my overtime, but if this got cut I would be in serious difficulties, so I am trying to take steps now to live within my flat months wages, then any overtime can go to reducing debt quicker or saving. Since getting my current job in 2005 overtime has always been the "norm", I havent earned a flat month in over 2 years! - the fact that the trust are even mentioning cutting it sends shivers down my spine (even though they couldnt operate without some degree of O/T)

brokemedic

Regarding the overtime, have you thought about joining NHS professionals or even an agency - don't know what job you do in the NHS but there are specialist agencies for nurses, social workers etc etc...or even joining the bank of a nearby hospital.

Not only does it help moneywise but think it's good in terms of networking and seeing what else is out there..

Konamb212

Unfortunately I dont have that option of going to another trust or bank/agency work