Thousands in debt-how can I clear it? Please help

MissLiz

I've been in denial about my debt for several months now, I don't even know exactly how much I owe because as soon as I get a statement in the post, I open it, have a quick look and then bin it.:eek:

I'm thinking it must be close to £30,000 and I have no way of paying this back although I want to, I really do.

I don't know who to go to or what I should do but I know that my minimum payments each month are close to what I earn so I am always trying to juggle my cards and I just can't do that anymore, its not clearing my debt, in fact it is just increasing as I have missed payments and made late payments.

Is there anyone with any suggestions? I would be very grateful for some.

WASHER

Welcome to MSE and the Debt free board.

Firstly, can you post an soa (incomings and outgoings), I'll get you a link in a mo.

The debt isn't going to go away and despite what you hear on the TV about companies wiping your debt off, this in reality doesn't happen.

What will happen more likely, is that you can free, independant advice from the CCCS, a debt charity, who will probably offer you a DMP (debt management plan), even if you can only afford a wee bit, its better than nothing.

You need to find out how much you owe, you can phone and ask for statements or can you look online at your credit card statements etc.

WASHER.x.

WASHER

http://www.makesenseofcards.com/soacalc.html

Use this to complete your SOA.

Tixy

Hi Miss Liz and welcome.

First you need to try and work out how much you owe and to who. So if you have any letters you haven't binned sort through them and work out the latest balance, or if you have internet banking for any account check the balance on there. If not you then this month save each statement that arrives.

Then you need to work out an income & expenditure account (also known as a statement of affairs) - use this link - http://www.makesenseofcards.com/soacalc.html. Be as detailed as possible about how much you are spending on each item, for items that are only paid once a year then include 1/12 of the annual cost each month.

Although it will take some time to pull this information its really worth it and you will start to feel much better by taking control.

Once you have these 2 items post onto this thread and then we can start making suggestions as to how you can tackle your debt.

In the meantime do you know what the £30k was spent on? do you have anything you can sell to raise some money to start repaying your debts?

Also do you have arrears for any priority bills such as rent, mortgage, council tax, gas, elec & water?

Essentially you will need to make your outgoings less than your incomings and throw all the extra at your debts. It won't be easy or quick but you probably didn't get into debt overnight either.

Good luck on the DFW road.

RAS

Copied from Tixy's post elsewhere.

Have you tried talking to one of the free debt organisations? http://www.moneysavingexpert.com/loa...help-plan#help
The guys on this link are the ones recommended on here. They will help you work out an affordable budget and then hopefully suggest a suitable solution for you (maybe a debt management plan would be the way forward). They will also inform you of any consequences to what you decide - such as ruining your credit rating (although it sounds like its already pretty bad).

It also might help if you posted a statment of affairs on here (SoA) so we can see if we can see areas you can save money or where you could cut back. http://www.makesenseofcards.com/soacalc.html

Charco_2

1. Think about what you earn
2. Think how much you spend on essentials (mortgage, electricity, food, council tax, car...)
3. Think about how much your creditors are demanding from you

If the sum of 2 + 3 is MORE than number 1 then you're insolvent (unless you have a significant asset to sell). Speak to someone about it. DO NOT COMMIT YOURSELF TO ANYONE AND DO NOT PAY ANYONE ANY FEES UNITL THEY'VE DONE A JOB FOR YOU... up front fees are a joke!

bailey59

Hi there, Just wanted to say that I have been in denial for over a year now and only recently have I had to face up to things as the entire thing was taken out of my hands and I have had to do something about it. I didnt even dare answer the phone or open my post. I owe approx £38,000 unsecured debts, plus my mortgage plus a secured loan so dont worry there are plenty of other people in the same situation as you. This entire website is a god send and you will find loads of useful information and great advice. You have done the best thing ever coming on here.

property.advert

People will say do a SOA and they'll chip in with a link I'm sure but my research gives me 3 answers to your problem.

1. If you have significant equity in or want to keep a property you own, then you might want to avoid bankruptcy (BR).

2. Your credit file is blackened already anyway so some form of interest freeze and whole or partial payback may be possible.

3. Cut back everywhere and pay it back.

What would I do ? look seriously at BR as large debts with relatively small salaries will take forever (5 years) to pay back and I could not handle that. If they won't accept a % repayment, then you've got to work out whether BR is not the better option.

Mathematically, if your figures are correct, 30,000 on cards at 3% repayment and 20% interest is 900 plus 500 interest or 1400 a month which is a gross salary of £21500 a year. If those numbers are correct, I don't see how you can pay it all back.

lucielle

Sorry property advert I think that's a bit harsh. Take a look at my siggy and see what we have achieved.

Miss Liz, well done for posting its always a bit scary. You nedd to get all your figures and APRs sorted and as the other posters have said give CCCS or one of the other charities a phone. Good luck for your debt free journey.
L

Charco_2

By all means contact CCCS or Payplan or any other debt charity.

Also speak to a few others too some of the "crooks" over in the "non charity" side. I strongly advise looking into insolvency which means either an IVA or Bankruptcy. If CCCS dont recommend an IVA ask them why, if an IP recommends an IVA ask them why... find out about as many options as you can then make the decision that suits you best when you feel compfrtable that you have all the information you need - discuss it with the good people on here!
All the options are going to be scary but you'll get through it. Bankrutcy is also something you should seriously consider! (Not as bad as it sounds if you go onto the Bankruptcy board... no picnic either mind!)

***I'm away to crawl into my air raid shelter to avoid the naesayers, good luck!***

MissLiz

Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Monthly income after tax................ 950
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 950

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 281
Management charge (leasehold property).. 0
Council tax............................. 25
Electricity............................. 20
Gas..................................... 10
Oil..................................... 0
Water rates............................. 12
Telephone (land line)................... 0
Mobile phone............................ 20
TV Licence.............................. 3
Satellite/Cable TV...................... 0
Internet Services....................... 15
Groceries etc. ......................... 150
Clothing................................ 20
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 50
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 20
Haircuts................................ 20
Entertainment........................... 20
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 666


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 0

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
Overdraft......................2300......0.........0
MBNA...........................4000......120.......0
HSBC Visa......................2500......70........0
M&S &More .....................2500......40........0
Amex...........................1700......40........0
RBS............................1300......30........0
Lloyds TSB.....................3000......60........0
Monument.......................3000......110.......0
Marbles........................3000......85........0
Total unsecured debts..........23300.....555.......-


Monthly Budget Summary
Total monthly income.................... 950
Expenses (including HP & secured debts). 666
Available for debt repayments........... 284
Monthly UNsecured debt repayments....... 555
Amount short for making debt repayments. -271

Personal Balance Sheet Summary
Total assets (things you own)........... 0
Total HP & Secured debt................. -0
Total Unsecured debt.................... -23,300
Net Assets.............................. -23,300