Debt Advice for self employed

Stressed2

Hello Everybody

I would be very greatful if someone could give me some advice. I am very confused and worried and don't have a clue what to do. Our situation is terrible and I feel really embarrassed. My Husband and I owe around £37k to personal loans and credit cards. Our mortgage is also maxed so we can not refinance this way. We have tried several times to sort the situation out only to find ourselves oweing more and paying more in interest.

We have always paid our bills and debts no problem, but last year our circumstances changed. We had our baby Daughter and my income went down. Ontop of this my Husband is self-employed and had little work for most of the year. We burried our heads in the sand really, and kept telling ourselves it would be ok as Up until this month we have always paid our debts and have no arrears on any of our household bills or debts.

From this month our Daughter is now going to Nursery and this now means i have to pay the nursery fees and have no money tpo pay the creditors.

So we talked and realised that we had no choic but to contact National debt line for advice. However my Husband is self-employed so we have to go through the business debt line instead.

They advised us to work out a business budget and write to all our creditors telling them we are having money problems and ask that they hold action and freeze interest. I have done this and included a token payment. Some of them are now phoning me regularly and chasing me for further payment - which worries me as I have never been chased for money before.

With the business debt people we are looking at a DMP. Which I thought was our best option as IO am terrified of going bankrupt and losing our home. We have a young Daughter and we need our house.

There is a couple of things that I am confused about My Husband is self-employed and so what would happen with a debt management plan if he had no work for a couple of weeks and we couldn't afford our repayment that month?

Also we have recently changed our bank accounts to a new bank as my husband has a loan and overdraft with our existing bank, and I was told they may try to take the money direct from our accolunt. Trouble is we have now made the switch, all our ditrect debits for mortgage, council tax etc are due out in the next couple of weeks from our new account. We have no money in this account, my husbands old bank account has a small credit balance, when he has been overdrawn for months, we can't afford to jsut repay this overdraft but if we withdraw money from it to pay our household bills then tell the bank we have money problems it will look bad so what do we do?

I am so depressed, I have no idea what to do and can't get through to the debt people.

Devils_Avocado

I was in a similar situation. Self-employed, 35K on bank loans and credit cards. Then I had to cease work due to heart surgery.

I contacted CCCS who interviewed me over the phone for almost an bour. The lady interviewer was great and totally non-judgemental. CCCS then supplied template letters for me to use myself and send to creditors. I also received a reference number to include in the template letters so that the creditor could check that I really was seing a debt specialist.

I got a mixed reception to my letters. Barclaycard, Halifax and MBNA were helpful in that they froze the debt and accepted minimal payments to be reviewed at regular intervals.

I had 3 accounts with Nationwide. They chose to ignore all of my letters to them and were amazingly unhelpful and bombastic - great to get stressy phone calls after major heart surgery! They farmed the debt out to several collection agencies who also ignored my responses and were even more intimidating. Eventually I received a CCJ on 2 of the debts. The monthly payments agreed with Northampton County Court were exactly the same ammount as had been suggested by CCCS in the first place.

My advice is to hang in there, be calm and don't let anyone bully you.

Mike

NorthernLas

Move enough money to pay the priority bills and food to cover you for the month!!! Then tell the bank you have problems, it does not matter what they think, you need to pay the priority bills.

Do not pay any more money into the old account.

Stressed2

Thank you for your reply and so sorry to hear your poorly .I hope you are starting to feel better and are on the mend. I can imagine how awful the money worries were for you at a time when you needed to concentrate on your health. Sounds like some of your creditors were awful with you too.

What is your situation now ? Did you manage to keep your home and are you still paying off your debts?

Can our creditors force us to go bankrupt or is it likely just to go to court to agree payments?

Sorry for al lthe questions and thanks again for your reply, you have helped me to feel a little better xx:T

mostlycheerful

Hello,
Some actions that many people take are worth considering doing and if you do all of these then it could help or even solve your situation :

1 slash all expenditure :
1.1 Cancel Sky and suchlike, get a freeview box, watch tv on the net, cancel contract mobiles and get pay as you go PAYG etc

1.2 cut food bill by buying the cheapest “value” brands and getting the reduced stuff, do some meal planning, look at the Old Style board here for cheap ideas, never buy coffee and bits and pieces when out etc

1.3 when you want something, both products and entertainment, look for it free or cheap on the net on general sites and in particular freecycle and freegle and the other free and swap websites then if it’s not there look next at all the cheapest options on ebay, amazon, loot, car boot sales, jumble sales and markets and if using normal shops only ever buy the very cheapest stuff and look for pound shops, reductions and shop soiled stuff

1.4 analyse all your utility bills and swap them all for cheaper options

1.5 keep a spending diary and analyse all your expenditure and adopt the rule that you only ever buy something if it’s absolutely necessary and you never buy anything just on whim

2 make more money
2.1 sell any and all tat and clutter on ebay, amazon, loot and at car boot sales

2.2 start a new business buying in stuff to resell on ebay, amazon, loot, car boot sales and maybe also take a market stall on Saturdays and Sundays, for instance if you sell cakes and chocolates and such like and get it right you can make a fortune very quickly so try several products and when you find a good repeat seller then you’re well on your way, millions of people do this and many of them are successful so you can be too if you put the work in and it doesn’t particularly take much cleverness or luck, it’s more simply to do with work and effort and going for it and getting stuck in

2.3 take a lodger or if you have two or three rooms spare then take two or three lodgers, this can instantly make a massive difference to your finances and take the heat off. Lots of people do it, it’s one of the tried and tested universal time honoured ways of paying off a mortgage so definitely consider doing it, it’s normally a great earner and it’s mostly very easy and money for nothing and it rarely goes wrong. If you’re really up against it then move yourselves into the living room and rent out your bedroom as well, it’s only for a year or two while you attack the debts and it’s definitely better than going bankrupt and losing the whole house, isn’t it, so needs must, so definitely consider doing this.

2.4 get some part time work, anything you can get, bar work, market stall work, secretarial, dog walking, cleaning, whatever you can find and whatever you can do, if you work every waking hour from now on you can make a significant impact on those debts.

2.5 look on this site and look at lots of other sites for money making ideas, there are thousands of ways of making money and some of them can be lucrative if you do it well. Of course watch out for scams and timewasters, there’s also a lot of silliness to try to avoid.

[FONT=&quot]Good luck[/FONT]

Devils_Avocado

Stressed2 wrote: »

Thank you for your reply and so sorry to hear your poorly .I hope you are starting to feel better and are on the mend. I can imagine how awful the money worries were for you at a time when you needed to concentrate on your health. Sounds like some of your creditors were awful with you too.

What is your situation now ? Did you manage to keep your home and are you still paying off your debts?

Can our creditors force us to go bankrupt or is it likely just to go to court to agree payments?

Sorry for al lthe questions and thanks again for your reply, you have helped me to feel a little better xx:T

Yes, I'm making a good recovery and looking for work. We've kept our home by converting to an interest only mortgage and am paying off our debts, albeit at a very slow rate.

I doubt if anyone will seriously try to bankrupt you, it's a little used option these days despite all the threats that are made. A simple court order is far more likely and at least the registrar won't make you pay an unreasonably high amount that you can't afford.

One thing I've learned is NEVER EVER TALK ON THE PHONE to debt agencies, especially don't fall for the "just a few security questions" ploy. They'll make you feel like **** if you speak with them. They have an armoury of ripostes and replies to everything you say, so don't enter their world! Send one of the template letters available on this site to make them desist from phoning you.

Mike