What If You Dont Pay Your Creditors

[Deleted User]

Please no nasty comments as am only asking a question

Lets say that a person who lives with their parents and is on sick pay not getting much and is owed several different banks money and now the debt claim groups have each account and this person has to pay each 1 a certain amount each month. But they are only willing to accept a certain small amount each month

This ends up with the person only have pounds left each week cos he has to pay each creditor so much that he is barely able to afford food and pay the bills he has. "struggles like hell" cos the creditos arent willing to accept smaller payments each month

now if the person decides not to pay the creditors, what would happen? I guess they cant take his house since he doesnt own 1

Thanks

Tixy

Hi aberdeenlad

If you don't pay your debts then your creditors (or DCAs) have a right to chase you for that money for 6years (from the date you stop paying).
Or they may in the meantime get apply for a county court judgement against you - in which case you would receive blue court papers through the post. You then have to admit you owe the money or file a defence. A CCJ could be granted against you which would remain on your credit report for 6years and would remain payable indefinatley.

However in the position you describe above the best course of action (in my opinion) would be to write letters to the creditors or DCA and explain that your were only currently earning sick pay and could only afford a token payment of say, £1 to each creditor each month. You could also ask them to freeze interest & charges and tell them you will offer to pay more should your financial position improve.
They would probably expect to see an income & expenditure account to prove this is all you can afford, but most creditors will eventually accept this situation until you can afford to pay more. The £1 token payments are to show that you are willing to repay your debts but can't (they are also useful if there ever was a CCJ court case to show you had been paying what you could afford).

DarkConvict

It sounds like this person is in a difficult situtation. With having to cut down on basic living costs, I would give either CCCS or National Debt Line a ring. In order to get some detailed professional advice on the issue they are facing.

jamesey07

hey i owe about 10 k on credit cards and have just ignored them for almost a year r more, i started getting letters from some of them offering about 40% off the debt, if you r only on sick pay i wouldn't leave myself short to pay them back, tell them that u can only afford about £1 a month r even 65p a month that way they might accept the £1 a month offer, if not and they continue adding the charges just default on them and ignore them and see what happens then as say the stress off them in your current sickness is actually making the sickness worse good luck

[Deleted User]

Hi Tixy

well am sure everybody would know the certain person was me hehe. Ive already tried everything. Am due 6 companies money cos its a mix of 6 different bak accounts or credit cards i had. However they have stopped the charges and also intrest rates on the accounts

Each 1 will only accept 1% of the balance and belive you me, the smallest 1 is something like £24 a monthh. The others are more. Ive explain that i was only getting £63 untill recently and although its went up, its still not a great amount.

Ive told them all that am gonna be on benefits untill atleast october 2010 but could be much longer. Ive already did the whole incoming and out going thing but, they still all epect on getting a lot each month from me and i honestly have no life

a lot of people have said to me they must acceopt even just £1 a month but when ive asked, they just say its a ridiclous amount and cant accept it

Thanks

DarkConvict

It must be hard to step up and admit the debt, so well done Deleted_User.

Based on how your creditors are treating you i would presume there are options available.
Using any PPI you pay for if it is valid
Claiming back unfair charges
Claiming back PPI payments (if applicable)
Setup a Debt Management Plan
Consider doing CCA requests to see if the debts are valid and enforceable.

Get professional advice as in my posts above from CCCS or National Debt Line.

There are options of Debt relief orders, and bankruptcy. As last resort options. But the reduced stress maybe best. If the income is so low, under £99 a month under bankruptcy i do not believe you have to pay anything towards the debts.

Tixy

Well it sounds like you have done things right. Are you actually paying them £1 each or nothing? If it was me I would continue to pay £1 even though they haven't said that is what they will accept. And if they ring you I wouldn't speak to them (there is a letter you can send to stop calls if need be) and if they write to you perhaps you could keep sending out the same identical letter of 'as you are aware I am not in a finanical postion to increase my token payments at them moment and so my offer of £1 per month remains'.

They could take you to court -but are not that likely to if they still won't get anymore money from you, as it costs them money to do so.
Should any of them send court papers then you need to respond to the court to say you are paying what you can afford (someone will advise better if that happens).

[Deleted User]

Tixy i am paying all 6 sveral pounds a month cos they all say that they accept £1 a month. The smallest amount am paying 1 company is £24, as for the other 5 ill need to go and check exactly how much they are getting cos ive lost count but its more than £24 a month. Thats why ive got no money. To be honest I would love it if they all would accept £1 each but they wont. Ill need to try and do what dark convict has said. Thanks

MrsTinks

OK it's VERY simple if you don't have it then they can't take it - simples as the meercat would say

There is a letter floating about that you can send to them - basically it states that as explained on the phone etc then you are currently on sick pay and this means you get £x per month, out of that £x you pay food, bills, rent etc I'm sure that you're probably running in the negative once you have paid everything you need to so explain that until your health improves you are unable to pay any more than £1 per month - it's not negotiable and stop paying them £24 or whatever with immediate effect.
The worth they can do is take you to court and get a CCJ - if you bring your SOA to the court and explain to the court what your financial status is - that you felt forced to pay more than that by their agents for a long time meaning you were unable to feed yourself properly I would bet a reasonable sum of money that the CCJ would be set at £1 per month

It IS important that as soon as you start earning again you are honest with them and immediately revise what you pay them they may threaten for a while and scream and shout and have tantrums but stick to your guns

babymoo

Hi, I am in a fairly similar situation. I am on sick benefit and only getting £50 per week. I got myself down to my local CAB with the help of my mum and they have been sorting everything for me. I have no more letters coming to me, no more threats my adviser wrote to them all stating how much I have coming in, how much I have going out and how much I can afford to pay them every month.

He will not allow me to pay anymore than £1 a month per company and like you there are about 6 companies. They will want more at first but when they realise you aren't going to give it they will be happy to be getting something.

elfen

Mine better be happy with £5 a month. Have said payments may go up if my money does (IB and DSA, DSA not counted as income cos its for things i NEED for my disability so they ain't having it!) and loan when stuff is sorted out......They can't force you to pay more, the fact you're making token payments is enough. Also, ask to deal with everything via post because they don't NEED your email and mobile/home numbers, they have them to harass you, and they know I'm serious after I had a bit of an episode and bellowed down the phone before being admitted into hospital (they then had my mum to deal with ,and she was NOT pleased with them!)