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StepChange_Pavan

Rochdale_Guy wrote: »

Hi,

Just added up what I owe and need to ask for opinion please:

Card 1: £9,000 owed: £296 minimum monthly repayment with £208 of that in interest
Card 2: £5,940 owed: £133 minimum monthly repayment with £116 of that in interest
Card 3: £3,284 owed: £99 minimum monthly repayment with £62 of that in interest
Card 4: £3,526 owed: £81 minimum monthly repayment with £52 of that in interest
Card 5: £1,675 owed: £39 minimum monthly repayment with £24 of that in interest

TOTAL OWED = £23,425

Total monthly repayments = £648 with £462 in interest charges, meaning only £186 actually reduces this mountain of debt each month

I also have £2,747 owing remaining on a car loan fixed at £106 a month at something like 7.1% until paid off.

I have a fee free £100 overdraft limit with my bank, and am always nearly £200 overdrawn the day before I get paid EVERY month. I get charged about 96p a month by the bank for being in the £100.01-£200 overdraft range.

I have done a previous CCCS Debt Remedy and didn't go through with it due to being:
a) totally scared
b) have not been well since Xmas and
c) having personal problems including stupidly hiding this from my partner who has now freaked out when I confessed, by my secretiveness and stupidity and lack of honesty.

The Debt Remedy suggested a DMP but that would take over 12 years to pay and posts on here, that is DOUBLE what other people seem to have as a solution (and that is if CCCS can get my creditors to freeze interest charges etc). 12 years? I know I can't pay much each month with what I have left, but that will take forever

My bank offered me a £20,000 loan a year ago - which it probably won't now, which came to £383 a month over 72 months (5 years) which includes £7,630 extra in interest = £27,630 TOTAL LOAN REPAYABLE.
That works out at just £105 in interest a month, as opposed to the crippling £462 I am currently paying (or about to stop).

Even though the bank loan would add an extra £7,630 on top of the £20,000, it seems more manageable to me if they offered it me again?

That would be cleared and paid off IN FULL in 6 years, ALL £27k.

The DMP (if cards 1-5 accepted my offer via CCCS) would take twice that long

I shouldn't ask but is the consolidation loan from my bank a viable option to clear it all?

The other thing is, if I went the CCCS Debt Remedy route, I would need a new basic bank account (Co-Op looks good), as Card 4 above is with my current bank.

I still don't get the direct debit situation, as obviously the Co-Op say they handle all the D/Ds from my current bank, but I would have to cancel the monthly D/Ds to my credit cards as soon as CCCS say I have been accepted for the DMP!

I get paid on the 15th of each month, and all my utility bills come out on or around the 16th, which is great. Four of the five credit card monthly D/Ds come out my account at the end of each month. I don't get when I am meant to cancel the c/card D/Ds and send them a postal order as a token amount with the pre-printed CCCS letter?

All I know is I am so stressed and something will go badly wrong?

Should I forget the bank loan dream and just apply online NOW to open the basic Co-Op account as that will probably take 4 weeks to set up

PLEASE HELP ME, TIME IS RUNNING OUT. The 4 credit card payments coming out of my account in the next 2-3 days WILL be the last full amounts I can make. I am that skint I am having to pay my rent on a credit card I have never missed a payment or been late, but can't go on paying £642 a month in minimum repayments.

I am so unhappy and want to get started ASAP.

Thank you for reading, I await any replies.

Yours ashamed,
RG


*EDIT*

Can I quickly also ask, when advised to open a basic account, can that include a cheque book as long as there is no overdraft facility? I was halfway through applying for a basic Co-Op account online that offers a cheque book and debit card, then got conflicting advice on another forum on here saying basic = NO cheque book.
.

Hi Rochdale_Guy and thank you for your post.

It’s difficult to say why a DMP is your best solution without looking at your situation in more detail. However, as you’ve already completed Debt Remedy we already have all your information and we can discuss this with you if you get in touch.

The consolidation loan could be a good idea if it still offered to you. You’re right that you’ll be paying more over the long term and you would need to ensure that you can comfortably afford the new repayments and that all your old cards are closed to get rid of any temptation to use them again.

Have you reclaimed any PPI that you might be entitled to? There’s more information on how to do this in this guide: http://www.moneysavingexpert.com/reclaim/.

You could also look at your budget in more detail to see what changes you can make to help clear your debts quicker. You wouldn’t usually be allowed to save for a holiday on a DMP and is there space for another tenant or could you car share or use public transport for example? There’s a lot to consider and obviously some of these suggestions won’t be for you, but we can discuss this with you if you get in touch.

With regards to the cheque book – most basic accounts with no credit facility won’t offer these so it’s important you make sure it is a basic account that you’ve applies for. You can have a cheque book provided that using it doesn’t mean that you get further in to debt.

I hope this helps.

Kind regards,
Pavan

StepChange_Pavan

harlow19 wrote: »

Hi,

I have about 15k of debt with take home pay of about 1500. I find it very hard to pay my debts down as they are spread over about 8 accounts. I am also terrible at managing my money and become demotivated after a week of being paid. I would really like to get a loan and pay one monthly payment which comes out as soon as I get paid. This seems like a good option which would help me stay on the right track... However, I do not have a good credit rating so was thinking of applying for a DMP as my accounts would get frozen (right..?) and the debts would start to come down. I could pay about 250 a month which more than covers the payments. Will this have an adverse effect on my credit rating? How do I go about it? I am also 19 so can I still apply for DMP? Also, a significant portion of the 15k is car finance and I would not be including this. So my total ideal repayments are 250 and then 236 for the car. From my income this may sound not like a problem but I have real difficulty managing my money and just feel like I am making no progress since running up my debts six months ago. One single payment would be far easier to manage and make real progress with. I just have no idea how to go about it. All advice greatly appreciated.

Hi harlow19 and welcome to the forum.

You’re right that a consolidation loan can seem like a good idea, but this might be difficult if you don’t have a good credit rating and it can sometimes make the situation worse in the long term. This blogpost will give you more information about the sorts of things you need to consider: http://moneyaware.co.uk/2011/04/to-debt-consolidate-or-not-to-debt-consolidate/.

There’s no guarantee that interest and charges would be frozen on a DMP as it isn’t a legally binding solution. However, this might not be your best solution and there might be other options available to you. A DMP itself wouldn’t have an adverse effect on your credit rating, but because you’d be making reduced payments you’ll be defaulting against the agreement which will affect your score. Having said this, you probably won’t be looking for any further credit until your existing debts are cleared.

If the finance for your car is unsecured, this would need to be included on your DMP – it wouldn’t mean that you lose it because the debt isn’t secured. Like I mentioned though, there could be other options available to you and we would need to look at your situation in more detail to be able to advise you.

It’s also important that you make changes to be able to manage your money better. Working to a budget and using ourselves and places like this website will help you to do this. You can also keep an eye on our blog which will give you support and advice to help you get debt free.

I’d recommend that you use our online advice service Debt Remedy (http://www.cccs.co.uk/ref/drcu) as this will help you to compile your budget and look at the debt solutions that are appropriate for you. If you’d prefer you can call our free helpline on 0800 138 1111, we’re open Monday to Friday, 8am-8pm. If a DMP is recommended we can administer this for you completely free of charge.

I hope this helps.

Kind regards,
Pavan

StepChange_Pavan

Pippin12 wrote: »

Hi

I've got two questions I'd like your help with please.

I'm not working due to a severe disability and am £5000 in debt to Capital One credit card (my only debt). I have negotiated a low payment with them (£11 a month) which means it will take 38 years to pay off!
I get DLA and income support and on my income and expenditure form from Capital One the DLA is treated like any other income. I phoned the CAB to check on this and the advisor told me that DLA is treated like any other income - this is borne out by the Capital One I and E form which asks for details of 'disability benefits' on the list of income sources.
However I read on this thread that DLA should be disregarded for I and E purposes as it is specifically to pay for extra expense incurred by having a disability.
Which advice is correct? Should it be included or not?

On another related issue because of my disability I need a mobile phone so I can access help quickly when I'm out and about. Without going into too much detail I wouldn't feel safe to leave my home unaccompanied without my phone. My contract has currently expired and I want to renew it, I want an upgrade because for this they don't do a credit check (fortunately). I realise that my creditor may see this as a frivolous expense but in my opinion it is needed because of my disability - this is why I am paid DLA, because of extra expense incurred because of disability.
Will it be ok to renew my mobile phone contract?

Many thanks.

Hi Pippin12 and welcome to the forum


With regards to DLA, we usually recommend that you include it as an income but you should include all the expenditure that relates to it too as that’s the reason you receive it. Even if this means it balances the budget out and that certain areas are higher than expected – you can just include a comment to explain.

For example, you’ve given a very reasonable explanation as to why you need a mobile phone and provided that the cost isn’t over the top and it is affordable, there shouldn’t be a problem with this.

I hope this helps to put your mind at ease but I would still recommend that you contact us so that we can look at your situation in more detail. 38 years is a very long time and there could be other options that could free you from your debt a lot quicker. You can visit our online advice service Debt Remedy (http://www.cccs.co.uk/ref/drcu) to look at your solutions or you can call our free helpline on 0800 138 1111 to speak with one of our advisors.

I hope this helps.

Kind regards,
Pavan

Rochdale_Guy

CCCS_Pavan wrote: »

Hi Rochdale_Guy and thank you for your post.

It’s difficult to say why a DMP is your best solution without looking at your situation in more detail. However, as you’ve already completed Debt Remedy we already have all your information and we can discuss this with you if you get in touch.

The consolidation loan could be a good idea if it still offered to you. You’re right that you’ll be paying more over the long term and you would need to ensure that you can comfortably afford the new repayments and that all your old cards are closed to get rid of any temptation to use them again.

Have you reclaimed any PPI that you might be entitled to? There’s more information on how to do this in this guide: http://www.moneysavingexpert.com/reclaim/.

You could also look at your budget in more detail to see what changes you can make to help clear your debts quicker. You wouldn’t usually be allowed to save for a holiday on a DMP and is there space for another tenant or could you car share or use public transport for example? There’s a lot to consider and obviously some of these suggestions won’t be for you, but we can discuss this with you if you get in touch.

With regards to the cheque book – most basic accounts with no credit facility won’t offer these so it’s important you make sure it is a basic account that you’ve applies for. You can have a cheque book provided that using it doesn’t mean that you get further in to debt.

I hope this helps.

Kind regards,
Pavan

Thank you CCCS_Pavan,

I appreciate your reply, but am little concerned as to why it’s difficult to say why a DMP is your best solution, when I have posted all my details, but thats okay - if confusing.

Yes, I did previously complete a DMP plan online and was emailed the relevant paperwork to set the ball rolling, but due to several major stresses andmy relationship falling apart never submitted it. It also had a debt missing off it. The suggestion then was 1) Bankruptcy and then 2) a DMP - which I was going to go for, but obviously never did.

After 3 emails and text reminders off CCCS over the December - January period, I emailed back to apologise and say I won't be going through with this one and will submit a new, more upto date one - which I am close to doing.

I am suprised you didn't shoot me down in flames for suggesting the consolidation loan, which would (if accepted) clear my debts in 6 years, as opposed to 12 years plus on a DMP - that was based on the last Debt Remedy that said I had £140+ available to offer.

Now from my latest SOA it says I only have £57 available each month. So that would surely be 20+ years

I think I will have to call someone tonight, but my Debt Remedy might have already been cancelled due to me emailing you, and remember, those figures on it are wrong and are underestimated

Please see my latest calculated SOA a few posts earlier.

I will check back later for any comments / suggestions please.

Oh, and I haven't tried claiming for PPI as the only loan I have is the current Northern Rock one and I didn't opt for any kind of "protection", and I also didn't take any out when I applied for all the cards originally as I knew even that back then (before I knew I'd end up in this mess) that that would cost me extra each month, so not much point in trying a claim really. Thank you though.

Thank you CCCS_Pavan and to everyone else trying to help.

scared-sick

Can you please tell me when I am officially classed as being on a DMP? When do I start being bound by dmp terms and conditions?
I have got a CCCS reference munber but I haven't signed any of the paperwork and sent it back yet due to needing to open a new bank account and get the details first.

And if I have sent the letters out with my reference number on but cccs have no other details yet, what will cccs do if any of these creditors contact them.

Pippin12

Thankyou Pavan, that is really helpful.

cheshirechick

We owe £15k on a credit card and desparately want to get this paid off. Because the interest rate is so high we are finding that paying the minimum repayment reduces the balance by next to nothing each month. Somone has suggested we pay as much as we can off the card each month, we think we can pay £1000 and then use the card for essential living expenses only rather than using our debit card. Currently we pay £350 per month on the card.
That way we can beat the interest charges. Does that make sense?

Treasure030508

Hi, i'm really concerned about my parents. They are both in their 60's and my mother has been made redundant. She has also had an operation (knee replacement) which went wrong and basically is unable to work still (she is under the hospital for her back and knee).

My father is working but doctor has told him his kidneys are in a bad way and needs to come off pain killers and have both knees replaced this year. My Dad works full time (which he struggles with his bad legs) and only earns about £16k per year.

My parents are in debt and can't afford to both be out of work, they already downsized to pay off their mortgage last year but they still have a loan which has about £19k (3 years to run still) and I know they have credit card debt too (7500 on one card and 3800 on other). Total debt must be about £30k! (obviously they didn't forsee my mum loosing her job).

They are worried sick and I just don't know what their options are. I have heard about IVA's etc and equity release but not sure where they stand as they do own their home.

Any advice would be greatly appreciated. I am posting this without even speaking to my mum as she won't approach anyone for help as feels terribly guilty for being in debt and is very hard on herself.

Thanks for reading.

MrsSLS

Trying not to type in too much of a panic.
Long story short - about three years ago I had racked up over £3000 in charges at Nationwide. I tried to reclaim but didn't succeed and the charges effectively were an unauthorised overdraft, which Nationwide pursued me for. They passed my debt over to Moorcroft Debt Recovery and I have been slowly but surely paying them off at £50.00 a month. My last payment was made today and I should feel elated!

HOWEVER

I got my (first) credit report today via CreditCheck and for the past three years, Nationwide have registered a default against me for the current account. There is no record of any payments being made to them.

I have previously spoken to the debt collector who deals with my case and about two years ago he assured me that payments were being passed on to Nationwide, but that they were slow to update their records. There is NO record of any of the money I have given to Moorcroft being sent to Nationwide?

I'm quite upset as I had really hoped my finances were starting to straighten out. I've asked the debt collector to call me this afternoon to explain what is going on.

Nationwide have my current address details, but haven't provided me with a current account statement for a long time.

What should I do please? How do I firstly establish that all the money I've paid to Moorcroft has gone to Nationwide, and secondly, how do I sort my credit record out to show that payments have been made faithfully for over three years?

Sorry for the ramble/rant - I'm just so disappointed!

Thanks so much

J

Tixy

MrsSLS wrote: »

What should I do please? How do I firstly establish that all the money I've paid to Moorcroft has gone to Nationwide, and secondly, how do I sort my credit record out to show that payments have been made faithfully for over three years?

Its very likely that a default would be issued in these circumstances.
When you say there is no record of your payments - is the current outstanding balance the same as the default balance? Once you have defaulted the default balance and date stays the same but if you make payments the current balance should be updated to reflect your payments.

Who should update will depend on whether nationwide have sold the debt to moorcroft or whether moorcroft are just acting on their behalf, and what they have agreed between them at the point of sale.

Does your credit file still show the debt in the name of nationwide? or in moorcroft's name?