In debt. Please advise.

RussKent

Hello all.

I have come here for some advice. Let me explain my situation as briefly as I can.
I have one debt from a loan of £4,000 which I took out to pay off my credit cards. I defaulted on this debt and it went to DLC. I paid them for about 6months, but have not paid them for over a year and the debt is now with a company I have not yet responded to.

I have another credit card debt of £1000 another of £500, a gas bill for £400 and an electricity bill for £200. All of these I have not spoken to for 2years but get the odd letter from a collection service. Plus I am always at the bottom of my £1500 overdraft (which costs me £30 a month)

Up until 2 years ago I was earning £28k, and the only reason I defaulted was laziness. I simply spent money before I got it. I got made redundant from my job and spent my redundancy money paying off another credit card debt.
I worked a very low paid job for a year, and am now working more hours but still very poor wages.

I need my car for work, but I need £2000 over the coming 4months to spend on new brakes, insurance, mot and tyres.


My main question is... Where do I start?
Right now, they are not knocking on my door. They just keep switching to different collection agencies.
I cant afford to agree to a monthly payment that I could keep that will actually make a difference to my debts. Even if I paid my big debt £50 a month That would take 6.6years to clear.
And if I paid £50 to them, and £10 to the others, plus my £30 over draft fee, that's £120 which I really don't think I would b able to afford.

I am worried that if I get in touch with them, I will have to send them details of my earnings and outgoings. Then they will see that I cant afford to pay off the debt and take to me court and take my car, laptop, furnature etc...


Thank you for your time if you read this.

Tixy

Hi Russ

If you decide to face up to your debts then first thing would be to establish if you have any CCJs already - you can do this either by getting your credit file (which will let them trace you to your current address) or by searching the registery trust online (£8 per address you search) - this is untraceable.

Aside from any CCJs if you start contacting your creditors most are likely to take reduced payments, you could start up a DMP (debt managment plan) with one of the charities where you pay them a fixed fee each month and they distribute this amongst your creditors.

Most creditors will accept a DMP especially one done by a charity as they will know you are paying all that you can afford. It is possible that a creditor would still take you to court, if that happened you would apply to pay the CCJ in installments and a judge would usually set this at a level you can afford (often the same as the DMP payment).

Only if you did not keep up with the CCJ installments could your creditor instruct a baliff to try to reclaim your assets.

If you decide to try to avoid your debts the truth is that they will probably catch up with you eventually and the debts by then will be higher and could have court fees etc attached.
They have 6years to chase you (unless they take court action) and the chance of you avoiding them for 6years is pretty unlikely.

Start by speaking to one of the debt charities about your options see here - https://forums.moneysavingexpert.com/discussion/2077631

debbieblueeyes

Hello russkent,firstly the worst thing you can do is worry i no its hard but you need a clear head to sort it out.the next thing i would do is(i imagine you already have done it)wright all outgoings and incomings and debts down on paper,3 seperate lists,then try and cut back on as much as you can eg do you really need the full sky/virgin package, mobile phone,etc,etc,and then phone the national debt line(free advice) 0808 808 4000,or payplan which is a free service(no admin fee)08448552163,payplan will contact your debters and arrange interest to be stopped etc,they do the work for you for free.Hope this helps,good luck