Please help me!!

biba_3

Hi I am new to this forum.

Sorry I am getting very depressed and don't know what to do.

Up to the past 3 months I managed to repay the minimal amount of my two credit cards. I also have an Amex Charge card, and the outstanding balance is £11,100 which I have not managed to pay for the past 3 months.

Amex has passed my details to AIC debt collectors who keep calling me at work and on my mobile. They want me to pay everything by the end of the month or will issue a Default.
I offered a monthly repayment of £700 or 800, but would not hear any of it.
"You can ask your friends to lend you money"

The only positive thing is that I still have my job. I can't sleep and really struggle to show a brave face at work.

Here is my SOA.
Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 1
Number of children in household......... 0
Number of cars owned.................... 0
Monthly Income Details
Monthly income after tax................ 2500
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2500
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 1100
Management charge (leasehold property).. 0
Council tax............................. 80
Electricity............................. 20
Gas..................................... 0
Oil..................................... 0
Water rates............................. 30
Telephone (land line)................... 20
Mobile phone............................ 30
TV Licence.............................. 12
Satellite/Cable TV...................... 0
Internet Services....................... 20
Groceries etc. ......................... 100
Clothing................................ 50
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 100
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)...... 0
Haircuts................................ 0
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1562

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
rbs credit card................4000......100.......28
amex credit card...............3700......100.......19
amex charge card...............11100.....0.........0
Total unsecured debts..........18800.....200.......-

Monthly Budget Summary

Total monthly income.................... 2,500

Expenses (including HP & secured debts). 1,562
Available for debt repayments........... 938

Monthly UNsecured debt repayments....... 200
Amount left after debt repayments....... 738

Personal Balance Sheet Summary

Total assets (things you own)........... 0
Total HP & Secured debt................. -0
Total Unsecured debt.................... -18,800

Net Assets.............................. -18,800

Please help me !

Thanks in adavance

Happytogetdebtfree

Hi therer and well done for posting on the board , im not very good at understanding debt collection agencies, you have alot of excess each month so im confused why you couldnt keep up the payments if you have a lot of excess each month ? could you maybe explain abit more ?

Tixy

Hi and welcome

With regards to AIC - I assume the 'you can ask your friends to lend you the money' was a telephone conversation? This is completely unacceptable - and for this reason we advise not to talk to DCAs over the phone but to keep all communication in writing.

A repayment of £700per month should be more than acceptable. But before yu make such an offer in writing make sure that you can afford repayments at this rate. If you can then I would write with this offer and perhaps enclose a cheque for the first months payment. Tell them you want to set up a standing order to repay the debt (do not set up a direct debit or a debit card payment as they can change the amount they take).

Personally I would recommend that you make debt repayments pro-rata to your balances - so if you have £800 available for debt repayments in total, then offer (800 / 18800 x 11100) £472 to AIC. This is their fair share of your available income - and if you include a version of the above income & expenditure in your letter they should accept this (and they will hopefully realise you cannot be bullied).

However before you work out the total you have for debt repayments you need to amend you SoA as there are items missing (that it is reasonable for you to include) such as entertainment, haircuts, presents, contents & life insurance - remember that whatever you offer needs to be sustainable going forwards.

There are some letters regarding telephone harrasment I'l find links for.

Tixy

Telephone harrassment letter
http://forums.moneysavingexpert.com/showpost.html?p=11571485&postcount=4

Pro-rata payment offer letter
http://forums.moneysavingexpert.com/showpost.html?p=26103815&postcount=89

You'll need to change to suit your circumstances but these should give you a starting point.

unhappy_with_ecar

Stop worrying, you can deal with this, there is plenty of useful help on this site and you can get info from the national debtline website. The debts are unsecured and therefore they are not priority debts. Your priority is your mortgage/rent, utility bills, food etc.
Have a look at some of the template letters available on this website or the other one I mentioned. Write to your credit card companies and AIC and make them realistic monthly repayment offers, also asking them to freeze interest and charges. You can also request that they only contact you in writing and not by telephone, explaining that you wish to be able to keep a formal record of all communications. It is not unreasonable to make such a request although the companies don't like it, they should comply - the Ombudsman recently noted that such requests are perfectly acceptable.
Realistic monthly repayments are what you can afford, not what the companies ask for. Personally I think £700 per month is ludicruous. Don't use all your disposable income dealing with debts, you need to start using it to save money so that in future you have savings to get you through problems.
You've spent money on credit cards, its now become a problem, ring fence the problem and deal with it seperate to your plans to sort out your future. You have nearly 20,000 of unsecured debt, getting the interest frozen would put you in a position to repay this over a period of time that you can afford,(for example 170 over about 20 years). In the meantime you will have funds to save and can at a later date make settlement offers to them.
They won't necessarily like the arrangement and will try and get you to pay more, but remember it is your life not theirs and you need to be able to prioritise on achieving a plan that is affordable and maintains your own health and sanity. Remember, just because they make a lot of noise doesn't mean they should be at the front of the queue to be paid.
It sounds like you are about to default on these cards, which will affect your credit rating, but to be fair it is debt that has got you into this problem in the first place so you shouldn't really be concerning yourself about borrowing more money for the next few years.
Make sure you respond to all letters, make offers to pay and keep those payments uptodate and you will do just fine.

onlypaddy

Hi Biba, welcome! You're in the right place. My comments on your SOA are below in red...

biba wrote: »

Hi I am new to this forum.

Sorry I am getting very depressed and don't know what to do.

Up to the past 3 months I managed to repay the minimal amount of my two credit cards. I also have an Amex Charge card, and the outstanding balance is £11,100 which I have not managed to pay for the past 3 months.

Amex has passed my details to AIC debt collectors who keep calling me at work and on my mobile. They want me to pay everything by the end of the month or will issue a Default.
I offered a monthly repayment of £700 or 800, but would not hear any of it.
"You can ask your friends to lend you money"

The only positive thing is that I still have my job. I can't sleep and really struggle to show a brave face at work.

Here is my SOA.
Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 1
Number of children in household......... 0
Number of cars owned.................... 0
Monthly Income Details
Monthly income after tax................ 2500
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2500
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 1100 Massive - can you renegotiate this or move?
Management charge (leasehold property).. 0
Council tax............................. 80
Electricity............................. 20 This isnt very much if it is an electric only property - are you building up arrears?
Gas..................................... 0
Oil..................................... 0
Water rates............................. 30
Telephone (land line)................... 20
Mobile phone............................ 30 Could be slightly less maybe...
TV Licence.............................. 12
Satellite/Cable TV...................... 0
Internet Services....................... 20 Cant you get a package deal? Usually you can get around a £30/month deal which would include some cable tv too...
Groceries etc. ......................... 100
Clothing................................ 50 Are these necessities?
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 100
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)...... 0
Haircuts................................ 0
Entertainment........................... 0
Holiday................................. 0 Really? If so, where does your £738/month surplus go?
Emergency fund.......................... 0
Total monthly expenses.................. 1562

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
rbs credit card................4000......100.......28 Could do with paying this one quicker
amex credit card...............3700......100.......19
amex charge card...............11100.....0.........0
Total unsecured debts..........18800.....200.......-

Monthly Budget Summary

Total monthly income.................... 2,500

Expenses (including HP & secured debts). 1,562
Available for debt repayments........... 938

Monthly UNsecured debt repayments....... 200
Amount left after debt repayments....... 738

Personal Balance Sheet Summary

Total assets (things you own)........... 0
Total HP & Secured debt................. -0
Total Unsecured debt.................... -18,800

Net Assets.............................. -18,800

Please help me !

Thanks in adavance

I dont have any more info with regards to the DCA - there are a lot more knowledgable people around here who can help with that.

I hope my comments arent too bad. I assume you live in or around the capital - at least I would hope so with a rent that large! I still think its far too high for someone living on their own though.

As for the debt repayments, you may want to jiggle these so you pay the one with the higher interest the quickest. Head to this site http://www.whatsthecost.com/snowball.aspx and input all your debt details and choose the interest order option - its pretty self explanatory. That will show you the quickest and cheapest way to pay your debts.

Other than that, your SOA says you have £738 a month surplus. Do you actually have this at the end of the month? If not, you need to work out where it goes. Start a spending diary, write down everything you spend down to the last penny chew from the corner shop. This way you can categorise your spending and see exactly where you need to cut down and spend that surplus hammering the debt.

And finally - have you had your Light Bulb Moment and cut up your cards, never to be used again? If not, get shredding is my final nugget of info.

Hang in there and good luck

biba_3

Hi Thanks for your comments

Yes I live in Central London.
Unfortunately I have renewed my tenancy agreement just before all my financial issues started.

I used to have another credit card ( £3500) with Barclays which I paid off in full a couple of months ago. Once I repaid it they have cancelled it.

I was on good way to clear the other ones and paying at least the minimal amount.
Then my authorised overdraft was cancelled by RBS, and to compensate I used my Amex Charge Card.

To top it up I had major family issues and went back and forth to visit my family based in France.

What put me in trouble is the fact to reimburse the Amex Charge Card in full (£11,100) by the end of the month.

After paying all the essentials, I still have around £800, which I used to spend on travel and entertainment, a bit of shopping and art.
I did not include that in the list because I stopped all these activities.

What I would like to do is continue paying the minimal amount for the two remaining credit cards and pay regular instaltments towards the Amex charge card.
Do you think this is feasible?

Happytogetdebtfree

Hi biba sorry about the family issues hope everything is ok now:), im no expert but i think what some of the others have said set up a standing order for a decent amount not everything you hvae left because well if you hit a bad month it would be no good, can you get someone to house share ? 1100 a month christ i am glad i live up north .. dont get down about it things will even out, no one in the right mind can expect you to pay 11,100 asap they will have to accept a standard payment only by standing order it sounds, read some of the letters the other peeps have linked and good luck. I have subscribed to the thread i look forward to reading the progress

ZarZar1990

biba wrote: »

Hi I am new to this forum.

Sorry I am getting very depressed and don't know what to do.

Up to the past 3 months I managed to repay the minimal amount of my two credit cards. I also have an Amex Charge card, and the outstanding balance is £11,100 which I have not managed to pay for the past 3 months.

Amex has passed my details to AIC debt collectors who keep calling me at work and on my mobile. They want me to pay everything by the end of the month or will issue a Default.
I offered a monthly repayment of £700 or 800, but would not hear any of it.
"You can ask your friends to lend you money"

The only positive thing is that I still have my job. I can't sleep and really struggle to show a brave face at work.

Here is my SOA.
Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 1
Number of children in household......... 0
Number of cars owned.................... 0
Monthly Income Details
Monthly income after tax................ 2500
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2500
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 1100
Management charge (leasehold property).. 0
Council tax............................. 80
Electricity............................. 20
Gas..................................... 0
Oil..................................... 0
Water rates............................. 30
Telephone (land line)................... 20
Mobile phone............................ 30
TV Licence.............................. 12
Satellite/Cable TV...................... 0
Internet Services....................... 20
Groceries etc. ......................... 100 Is there any way at all you can cut this? Cheaper supermarkets? Visiting family for meals? Freezing food? Limiting groceries to £20 a week?
Clothing................................ 50 Don't buy any new clothes?
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 100
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)...... 0
Haircuts................................ 0
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1562

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
rbs credit card................4000......100.......28
amex credit card...............3700......100.......19
amex charge card...............11100.....0.........0
Total unsecured debts..........18800.....200.......-

Monthly Budget Summary

Total monthly income.................... 2,500

Expenses (including HP & secured debts). 1,562
Available for debt repayments........... 938

Monthly UNsecured debt repayments....... 200
Amount left after debt repayments....... 738

Personal Balance Sheet Summary

Total assets (things you own)........... 0
Total HP & Secured debt................. -0
Total Unsecured debt.................... -18,800

Net Assets.............................. -18,800

Please help me !

Thanks in adavance

You need to find out where the extra money you're missing is going, keep a spending diary, trust me on this one, you'll be surprised where all the money goes! Mine was all going on magazines, chewing gum and chocolate bars :rotfl:
More people should be along soon with more advice, have a look through the website to see if you can find anything useful that Martin himself has said? xxxxx

biba_3

Ok I got a couple of news today.

I called RBS to pay £270 on my credit card.
On the positive I got confused with the amount I owe them, I thought it was £4000, it was actually £3270. So after this payment I owe them £3000.

On the negative side (of course) they mentioned this payment was 2 days too late and have now cancelled my card and I need to pay the remaining balance in full.

So I explained that I could not pay in full and would come back to them on Monday with an offer.

If I do a monthly repayment plan, can I choose a specific amount, let's say £200 for RBS and £400 for Amex, or does it have to be equally split?

To top it up AIC left me two voice mails and and also sent a lovely sms
"The courtesy hold we agreed has expired. You must contact me on XXXX to discuss the pending action on your account." Of course I can send a sms back, it came back undelivered.

biba_3

Do I send letters to Amex or to the debt collector agency?

Thanks for your support