Struggling with debt? Ask a debt advisor a question

JohnDecker1

I have been warned by this company that they could take me to court

StepChange_Pavan

OTT888 wrote: »

Dear Debt Counsellor

We are struggling with debt.

We entered into a payment plan in 2002 with Baines and Ernst until we saw the error of our ways and stopped paying money to someone for help. We spent some time with a company called Debt Management Associates who were helpful but we were really forced into going with them by Barclaycard, one of our creditors.

In 2007 we went to Citizens Advice as things were getting very difficult. They passed us to Community Law Service in Northampton and they set us up with a dmp. In 2008 my husband was made redundant and we re-visited everything again with CLS and our payments were brought down. These payments have never gone up due to the fact that:

1. We were on an interest only payment plan with our mortgage which has now gone back up to the full amount (and more).

2. My husband earns £8k less than he did in his previous job.

At present we have around £25k in unsecured debt and £15k in secured which are subject to charging orders on our house. Our DMP is £311 a month (£268 on the charging orders and £43 on the unsecured debt) which means we are paying things off very slowly on the unsecured side and starting to get hassle again!

There are just a few issues arising now that are making us question whether we should change to CCCS.

1. Some of our minor payments were mistakenly left off our DMP which got us into more trouble and we have had to settle an agreement with these separately. One of them went to a CCJ and we ended up paying more costs and had to pay off the debt in full.

2. Whenever I contact the CLS they say as I haven't spoken to them for 6 months they need to re-open my file and start again which is a bit annoying as sometimes I only want to ask a quick question.

My other worry is that things are still becoming increasingly tight. My husband has a company car and we have only just had the tax code through for his car and fuel at work which has meant that suddenly we have a lot less income than before.

I have also received a statement from Natwest who is one of our creditors giving a loan account number I have never heard of and stating that we owe over £5k, they have added interest and we have not made any payments. I have written to them today for a breakdown and a copy of our credit agreement.

This must sound very confusing to you but we are just wondering if we need to start again!

Many thanks
OTT888

Hi OTT888 and thanks for your post – I’m sorry for the delay in responding to you.

The main thing is that you’re not paying for the debt advice and from what you’ve said you may find it easier to get in touch with us – if only for the reason that your file has to be re opened every 6 months.

We would need to look at your situation as a whole (including the minor debts) and see what options are available to you. You’ve mentioned that your circumstances have changed quite a bit so this could mean that a DMP is no longer appropriate for you, but we can explore all of your options with you.

I’d recommend that you visit our online debt advice service Debt Remedy (http://www.cccs.co.uk/ref/drcu) to help you find a solution to your debt problem quickly.

Debt Remedy will assist you in completing a financial statement with information on your household, employment, income, expenditure and debts. From this the service will automatically determine your options.

To help you fill in the form, it’s best to gather together information about:
• Your income
• Your expenditure
• The creditors you owe money to

You’ll receive a downloadable advice booklet providing a tailored solution for you based on your current circumstances and advice on ways you may be able to improve your situation.

If you’re not confident with computers or would like to speak to an advisor then you’re welcome to ring our free Helpline on 0800 138 1111. We’re open Monday to Friday 8am - 8pm.

If you phone us it may be possible to refer you directly to a counsellor for immediate advice. Alternatively, we will arrange for an appointment to be booked at a time convenient for you.

Kind regards,
Pavan

StepChange_Pavan

Lilpalf wrote: »

Hi, I'm new to the forum and just wanting some advice really.

My husband and I realised that we had more outgoings and incoming a couple of months ago and contacted National Debtline who suggested a few options to us. We decided that a DMP was a good option for us. We have over £60,000 of debt, all unsecured and after working on our budget felt comfortable with an excess of £650 per month to be shared with our creditors. We filled in a DMP application and sent it to National Debtline who referred it to Payplan.

They contacted me within a couple of days to say that a DMP was one option but it was painted to be quite threatening with the creditors constantly chasing us and maybe still taking us to court and then they said they felt a better option was a IVA for my husband (the largest portion of debt) with a DMP for my debt. It was given as the better option with no pressure from the creditors, no chance of them still charging interest, and because it was in my husbands name only, my share of the equity in the property would be protected.

Sounded good.

However, we have since done some reading about IVAs, including on this site and it seems much more serious than Payplan are stating. Just spoken to them again and when I mentioned that I thought we would do the DMP, they really painted it badly. I asked about their fees, but she wouldn't tell me what they were.

I'm feeling really confused. I don't want to go down the road of the IVA if it isn't really necessary.

Just really wanted to know the thoughts of IVA v DMP

Hi Lilpalf. Thanks for your question and I’m sorry for the delay in getting back to you.

It’s difficult to say which option would be best for your situation as there are no hard and fast rules and it really depends on your situation as a whole.

You can read about the generic differences on our blog: http://moneyaware.co.uk/2011/07/12-differences-between-an-iva-and-a-dmp/

If you’d like us to look at your circumstances to offer a second opinion you can use our online debt advice service Debt Remedy (http://www.cccs.co.uk/ref/drcu) or call our free helpline on 0800 138 1111.

I hope this helps.

Kind regards,
Pavan

StepChange_Pavan

jackelliot wrote: »

Hi, I am currently in a situation where I have a large amount of debt and I have been saying for years that it WILL be sorted but it never does!!! I work bloody hard and at the end of the day I have absolutely nothing to show for it! All my debt is currently up to date with payments and I haven't missed any in years (in fact, my current credit card issuers (Barclaycard 9k owed, Halifax 1K owed, LTSB 2K owed) keep offering to up my credit limit!). On top of these I have a loan of 23K still to pay over the next 5 years with the halifax. The problem I have is Halifax have my current account (currently 2,500 O/D) and my mortgage (like many now, in negative equity!). If interest rates rise, I am in a lot of trouble so I need help now!! Where do I start in sorting this mess out!!?? Believe it or not, my biggest fear is about my future should I take out one of these 5 year plans. I need to move house at some point as I have 2 kids (1 boy and 1 girl) and only have a 2 bed house. I can move my mortgage to a new property but in the future (10 years down the line) I may want a bigger house with a bigger mortgage as I will be on a bigger salary. Will taking one of these plans out stop that from happening?? I know it sounds daft thinking about 10 years down the line when I have these problems NOW! Any help or advice you can offer me would be greatly appreciated.

Thanks
G

Hi G and thanks for your question.

It’s difficult to say what your options are without looking at your situation in more detail.

Ultimately, if you opt for any kind of debt solution, your credit file will be affected for 6 years. However, you’re right that the more pressing issue is your situation at the moment.

You say that your income is likely to increase which suggests that your circumstances will improve in time. I’d recommend that you draw up a budget based on your income and expenditure now to see if there any changes you can make in the short term to help.

If you’d like to discuss your situation in more detail you can call our free helpline on 0800 138 1111. You can also use our Debt Remedy (http://www.cccs.co.uk/ref/drcu) if you’d prefer to look at your options anonymously online.

I hope this helps.

Kind regards,
Pavan

StepChange_Pavan

ptw086 wrote: »

Hi Pavan or Mat,

I really need help with my debt problems. I seem to have gone from doing a well paid job to zero all in the space of a year. HAvine been miserable working for a big corporate - something I'd done ever since Uni, I jumped at the chance to work on a start up company in 2009. Money was tight but I had savings that I could take the risk with if things didn't work out. 2009 was tough and I relied on my credit cards more than I would have liked but was still ok. Having been pretty frugal up until now I had three credit cards but only one with a 6k balance on it that i was paying off and a 3500 overdraft that I never used. Then it all went wrong. In 2010 the company lost all its funding and went bust. At the same time my father who was ill with cancer got worse and I lost him in July last year. I was spending on nursing Dad, looking after Mum and no money coming in. The company eventually folded in Sept 10 and by now I'd used up my 3motnh savings buffer so was relying on credit cards, and overdrafts. I notified my bank First Direct with whom I've been since 1995 and notified my Halifax my mortgage lenders as I defaulted on a mortgage payment. At this time I was managing the minimum payments on my MBNA which was now 15k and 2k on the First Direct gold card. I had also maxed my 3500 overdraft. I desperately stared looking for work but got nothing from Sept to until Jan 2011 so the cards and overdraft were used for all bills, mortgage payments and living. I finally got some contract work but really poorly paid at 350 per wk - by now I was desperate. As soon as the money was coming in it was going out. There were days I wasn't even eating. I called the bank again and asked if I could consolidate the loan to make the payments easier as now more DD's were bouncing and I was paying over 150 a month in pre notification charges and interest. They said no as I was on a contract not in regular employ. My mother went to live abroad as things are cheaper for her there but fell ill so now I've had to come out to help her out. I have a job here but its not earning me much just enough to live off here and look afer Mum until she's better. I've kept the banks informed and i've eliminated at lot of the the UK cost of living as I have put my flat on rent and that is covering the mortgage and I will clear that arrears in the next two months. I\ve also closed utility accounts etc which has helped me bring the overdraft down from 3500 to 450. But the credit card bills are impossible. I've been rate jacked by MBNA. Just as I cleared the late payments which were coming in at 250 per month they've now gone up to 372 per month. The first direct card which had a capital amount of 2000 on it is now outstanding at about 3500 because I can only make the minimum payments and now I can't even make those any more. AS of the last two months i am now officially in debt crisis and the stress of this is unbearable. Its seems as jsut as I claw some money back the hole gets bigger. I've spoken to my mortgage protection people but they are taking so long to process my claim that I've refused to make any more payments to them as I don't see the point!

I've looked at the debt counseling services you've mentioned. Can I still contact them whilst I am temporarily abroad looking after my mother? I can't leave her. But I can Skype and email and speak on the phone. I am a British citizen. I just need someone to think straight for me and tell me what to do. As I'm worn out...

Also do you think its worth me asking MBNA and First Direct to provide me with a copy of my signed agreement. I'm pretty sure FD didn't give me a signed agreement. I had that card way before 2006 and never used it. They were desperate for me to have it in early 2000 as I was a "favoured" customer then. Same with the Virgin card.....I'm pretty sure the stipulations in the Consumer Credit Act were not followed....what do you think?

Hi ptw086. Thanks for your post and sorry for taking time in getting back to you; we were out of the office at the start of the week and it’s taken us a little time to get back on top.

You’ve already had some good advice from Tixy on another thread but if you’d like to talk through your options like you’ve mentioned we can certainly help.

You can call us on +44 113 297 0126 and we will look at your circumstances in more detail.

I hope this helps.

Kind regards,
Pavan

StepChange_Pavan

scared_and_alone wrote: »

i have just come off the phone to one of your advisors and just want to say how wonderful you are

i have spent the last month not eating or sleeping with worry over my situation but the wheels are in motion for me to now start a DMP

i am still a bit scared as to what the next couple of months have in store for me but the counsellor has assured me i will come out the other side of this and i know i will now that i have you on side with me

so thank you CCCS for helping me on my journey to get my life back on track...you are literally a lifesaver!

xxx

Hi there,

Thanks for taking the time to post such a lovely comment.

It’s always good to hear from people that we’re helping. You’ve done the right thing by contacting us for help and hopefully things will look up from here.

If there’s every anything you’re unsure of, you know where we are


Kind regards,
Pavan

StepChange_Pavan

CarolnMalky wrote: »

I would like to ask a really daft question please, I have an appointment tomorrow for a counsellor to call me. If I go down the route of paying back say £1 a month to my credit card, will this ever end? or will the credit card company hassle me to pay it back? Or will it eventually get written off?

Thanks in advance for your help

Hi CarolnMalky and thanks for your question (it’s not a silly one!)

Making token payments isn’t a long term solution as you’re right that you’d probably end up repaying them forever.

It’s unusual for debts to get written off for no particular reason and you would still get contact from the creditors and probably requests to pay more.

If you’ve not had your appointment with us already, talk through your concerns and hopefully we’ll be able to put your mind at ease and answer your questions thoroughly.

Hope this helps.

Kind regards,
Pavan

OTT888

Thanks very much Pavan, I will do the questionnaire tonight and then ring through tomorrow.

OTT888

ptw086

Thanks Pavan. Found your comment. I will certainly give you guys a call to talk. Time diff is a bit tricky but I'll manage it no worries.

k2bedebtfree

hi i am new to this but i put a thread on debt free wannanbe last night under my name k2bedebtfree but its gone and i cant find it, it had a soa on it too which took me ages. but basically i have taken a drop in work and now am in a predicamont about it . i have 27000 in debt with credit crds and i cant afford to pay them i never miss payment however high but i dont simply have the money for them. i only have 60 spare after paying my usual payments. so help me please. i can do another soa if need be . . .