Struggling with debt? Ask a debt advisor a question

imthe19thangel

Hello,

Im 22 and more than likely in over £5000 worth of debt. Ive been ignoring my creditors for so long they dont even try anymore. I will in the future want to get a mortgage and have realised i need to sort myself out. I am now in Full time employment and in a position to pay and want to start A.S.A.P. I just dont know where to start.

I have no correspondance letters and no credit card to be able to see my credit rating, when i tryied contacting the people i thought i owed money too they wern't interested as they had already sold it on.

What do I do?

mikestones

It would depend on your individual circumstances so I recommend that you contact our Client Support department to discuss this in full. They will explore all of the options that are available to you

flossieflipflop

Hi,

I'm hoping you can give me some advice/information. I have been in a dmp for the past 3 years (unfortunately a fee paying one) to pay off 3 creditors (debt was about £17,000 of credit cards, loans and overdrafts).

I've religiously paid £250 a month on time and every month to my DMP people (220 going to creditors). So a total of £8500 has been paid.

Yesterday while looking at my credit file I noticed that Lloyds tsb have added defaults to my overdraft and loan. These defaults were added in April and May 2010. Can they do this 3 years after entering a dmp?? I don't understand why they didn't do it at time of default which would have been October 2007.

Secondly I was looking at my statement from barclaycard (I have been stupid and ignoring letters and statements and only recently have decided to face up to everything in an attempt to clear my debts faster) and noticed that they have consistently been adding late payment charges and a lot of interest as have Lloyds. I don't know about Egg (my only other creditor) as they never send me any information. Anyway I thought the companies froze charges and interest if in a dmp? I know they are not obliged to do this but thought they would to get the debt paid back? I'm feeling really rubbish right now as feel I have got nowhere in the past 3 years. According to my credit report I still owe a total of £13,000 so clearly an awful lot of charges and interest have been added along the way. E.g. My overdraft with Lloyds was at £2000 in Oct 2007. 3 years of payments later it has increased to £2400!!!

I feel I'm in a worse position now than when I joined the dmp and don't know what to do next. Is there anyway I can get these creditors to remove the charges added since joining the dmp?

Should I leave the dmp and just make payments on my own (hoping that way I will have more control over it)

If the companies involved agreed to removing the extra charges (since being in the dmp) I could probably now afford to revert back to the original contracted payments (and leave the dmp) - in your experience is this something they would consider?

Many thanks for any help/advice

bhoy1976

CCCS_Sue wrote: »

Hi bhoy16,

Thank you for your message.

You are already doing as much as you can by making realistic payments that you can afford. If your circumstances improve in the future, then you will be able to offer more each month and clear your debts quicker.

If you do receive a CCJ, you can apply for a Tomlin Order which withdraws court action in order to avoid disciplinary action at work. You can only apply for this once you have received the paperwork, so if this happens I would advise you to give us a call.

I hope this helps to put your mind at ease.

Regards,
Sue

Hi Sue,

I had my first piece of bad news today from my credit card company.

They told me that whilst they appreciate my financial circumstances, this new offer of payment is not sufficient to enable them to accept me onto a formal payment programme, though I should continue with the offer of payment nonetheless.

They did note however, that they will waive future interest charges and future late and over limit fees. This will also change the how they calculate the minimum payment on the statement.

The really bad news was that my level of payment is not sufficient to prevent a Default from registering and that it would remain on file with credit reference agencies for six years. They did say however that they will contact me prior to registering the Default.

How does a Default affect me? Does this letter mean they intend to register a Default or it is just a possibility?

I really don't know how to handle this at all.

bhoy1976

mickstick

Just paid of all my debt after 5yrs with cccs.I am saving hard for the next 2 or 3 yrs and want to get a mortgage will i have to wait longer or can i use a broker

twoflower169

Hi

I wonder if you could answer a couple of questions with regards to a f&f offer, we will in the next few weeks be given a lump sum of around 15k, as an inheritance, we currently are on a DMP with yourselves with 12 creditors (of which one is Northern rock and it is a unsecured loan as part of a together mortgage), our current outstanding debt is around the 60k mark, of which 30k is northern rock. We have discussed the possiblity with northern rock that we may be in a situation to go back to paying our mortgage as capital and interest as we are only paying interest only at the moment, and to pay the unsecured loan at full payment (with arrears paid up), but they understand that they would not be part of any f & f offer process and they are happy for us to return to previous terms. So that leads me to ask:

1. Will our other creditors have an issue if we do not offer NR any money as this would be treating someone with preferential treatment?
2. Do we just divide the money (15k) up between them all (minus NR arrears) and say this is all we can offer? Or do we start at a % and work up to the amount we have?
3.What happens to our dmp if some of the companies will not accept f&f offer?

Also to add fun to this equation I am currently pregnant with our 2nd child and will be on maternity leave in a few months and my salary will go down, will this help if mentioned when offering f&f offer as out payment to yourselves will go down once my pay goes down, and the creditors will receive less anyway if they dont accept f&f offer.

It also concerns me if only some of the creditors accept and the others dont which means we may not be able to pay NR full monthly payments and have to stay in dmp, could they then in future pull out of dmp as they would never have been offered any f&f payment, and they could see this a preferential treatment.

I'm sorry if this is too long, but these questions have been going round in my head since I knew we would get this money.

Thanks for any help in advance.

CCCS_Sue

imthe19thangel wrote: »

Hello,

Im 22 and more than likely in over £5000 worth of debt. Ive been ignoring my creditors for so long they dont even try anymore. I will in the future want to get a mortgage and have realised i need to sort myself out. I am now in Full time employment and in a position to pay and want to start A.S.A.P. I just dont know where to start.

I have no correspondance letters and no credit card to be able to see my credit rating, when i tryied contacting the people i thought i owed money too they wern't interested as they had already sold it on.

What do I do?

Hi imthe19thangel,

Thank you for your message.

I would recommend that you apply for a copy of your credit reference file. This will tell you how much you owe and who to.

I have attached a link to a booklet called ‘Credit Explained’ and this gives you more information on how to get your credit file: http://www.ico.gov.uk/upload/documents/library/data_protection/practical_application/credit_explained_leaflet_2005.pdf

Hope this helps.

Regards,
Sue

CCCS_Sue

imonlyamole wrote: »

I've been on a DMP with CCCS for the past 3 years and haven't paid much off what I owe as most of the debtors I owe money to will not budge on dropping the interest payments. (For example, the balance of a Lloyds TSB credit card I owe money to has only dropped by £80 in 3 years even though i've paid them £850 during that period through CCCS).

One of the things i'm worried about though is that an Alliance & Leicester Loan I had for around £9,000 has been frozen on my CCCS account since December (i.e. no payments have been made to it). When A&L became Santander, they sold the debt on to an external agent but they couldn't give me any details of who the agent was and said I just had to wait to receive information off them - which is why CCCS froze my payments.

It's been over 7 months now and I still haven't heard anything. I have moved house but i'm assuming they'd still be able to track me down.

Any advice on what I can do? I'm having trouble contacting CCCS by telephone at the moment as i'm working long hours and the phonelines are closed by the time I get home.

Hi imonlyamole,

Thank you for your message.

If you send your client reference number to [EMAIL="contactus@cccs.co.uk"]contactus@cccs.co.uk[/EMAIL] I will forward it on to our Client Support team who will be able to help.

Regards,
Sue

CCCS_Sue

flossieflipflop wrote: »

Hi,

I'm hoping you can give me some advice/information. I have been in a dmp for the past 3 years (unfortunately a fee paying one) to pay off 3 creditors (debt was about £17,000 of credit cards, loans and overdrafts).

I've religiously paid £250 a month on time and every month to my DMP people (220 going to creditors). So a total of £8500 has been paid.

Yesterday while looking at my credit file I noticed that Lloyds tsb have added defaults to my overdraft and loan. These defaults were added in April and May 2010. Can they do this 3 years after entering a dmp?? I don't understand why they didn't do it at time of default which would have been October 2007.

Secondly I was looking at my statement from barclaycard (I have been stupid and ignoring letters and statements and only recently have decided to face up to everything in an attempt to clear my debts faster) and noticed that they have consistently been adding late payment charges and a lot of interest as have Lloyds. I don't know about Egg (my only other creditor) as they never send me any information. Anyway I thought the companies froze charges and interest if in a dmp? I know they are not obliged to do this but thought they would to get the debt paid back? I'm feeling really rubbish right now as feel I have got nowhere in the past 3 years. According to my credit report I still owe a total of £13,000 so clearly an awful lot of charges and interest have been added along the way. E.g. My overdraft with Lloyds was at £2000 in Oct 2007. 3 years of payments later it has increased to £2400!!!

I feel I'm in a worse position now than when I joined the dmp and don't know what to do next. Is there anyway I can get these creditors to remove the charges added since joining the dmp?

Should I leave the dmp and just make payments on my own (hoping that way I will have more control over it)

If the companies involved agreed to removing the extra charges (since being in the dmp) I could probably now afford to revert back to the original contracted payments (and leave the dmp) - in your experience is this something they would consider?

Many thanks for any help/advice

Hi Flossieflipflop,

Thank you for your message.

You mentioned that you are in a DMP with a fee charger. Have you considered going to a non fee charging debt advice charity such as CCCS? This way, the extra £30 per month could be going towards your debts.

Creditors can issue default notices any time after the terms of the original contract have been broken. Usually this happens after you have missed three to six payments. It might be that they are thinking about passing the debt on to a debt collection agency and legally they cannot do this until a default notice has been issued. I have attached a link to our website which explains more about default notices and the collection process: http://www.cccs.co.uk/InfoCentre/EnglandandWales/Creditoraction/Courtaction/Defaultnotices.aspx

With regards to the interest and charges, you are right that there is no guarantee that they will stop them when on a DMP. There is more information about what creditors tend to do on our website here: http://www.cccs.co.uk/InfoCentre/EnglandandWales/Creditoraction/Chargesandinterest.aspx

I would recommend that you speak to one of our trained debt counsellors as there may even be other options available to you. You can call free on 0800 138 1111 and lines are open Monday to Friday, from 8am until 8pm.

Alternatively you can visit our online debt advice facility called Debt Remedy. Debt Remedy would assist you in completing a financial statement and you would be provided with tailored advice on the best way to deal with your situation. This link will take you directly to Debt Remedy www.cccs.co.uk/ref/drcu


Regards,
Sue

CCCS_Sue

bhoy1976 wrote: »

Hi Sue,

I had my first piece of bad news today from my credit card company.

They told me that whilst they appreciate my financial circumstances, this new offer of payment is not sufficient to enable them to accept me onto a formal payment programme, though I should continue with the offer of payment nonetheless.

They did note however, that they will waive future interest charges and future late and over limit fees. This will also change the how they calculate the minimum payment on the statement.

The really bad news was that my level of payment is not sufficient to prevent a Default from registering and that it would remain on file with credit reference agencies for six years. They did say however that they will contact me prior to registering the Default.

How does a Default affect me? Does this letter mean they intend to register a Default or it is just a possibility?

I really don't know how to handle this at all.

bhoy1976

Hi bhoy1976,

They are right in saying that you should continue to make the payments even if they don’t think it is sufficient.

If you are already offering them as much as you can, along with a copy of your income and expenditure as proof, then you have done the right thing.

A default notice is normally issued when you have not been making minimum payments on a debt. It is a legal requirement on their behalf, which states that you have not maintained the terms and conditions of the original agreement.

If you are unable to make the minimum payments, it is quite likely that they will issue a default notice against you, and the creditors don’t always give you a prior warning.

A default will stay on your credit reference file for 6 years but it is unlikely to affect your employment. I have attached a link to a booklet which explains a bit more about how credit reference files work: http://www.ico.gov.uk/upload/documents/library/data_protection/practical_application/credit_explained_leaflet_2005.pdf

I hope this helps.

Regards,
Sue