Advice on bank debts?!?

MadamMim2013

Hi,
Please forgive me if this could have been posted elsewhere but I've been searching for days looking for some advice to no avail!

My husband and I are in major debt owing all to one bank (Nwst) in the form of loan, overdraft & credit card. this amounts to £17,000 (L), £3,400 (o/d) and £1,550 (c/card)

We are struggling badly, paying £318 per month off the loan then just the fees for the others, it's getting worse each month not better.

We've been to the bank to request help on previous occations
but one young girl wasn't that helpful and the next told us due to hubby having a business acc with them we had to deal with the business banking advisor!!!

Well, made an apt and we saw him today, he was sympathetic and said he could try & get the underwriters to make us a deal but it would be roughly £22,000 over 10 yrs at 12.9%apr, working out that we'd have to pay £318 (which is our monthly payment at the moment) yet we'd be paying back £38,000!!!!! (sobs quietly)

He did offer a possible £5,000 loan to cover just the o/d & c/card yet at over £80 per month (for 5 years) it'll mean paying nearly £500+ on debts per month, something that's just not doable....

I did mention the fact of going bankrupt and he said we didn't need to be that drastic, as we hadn't ever missed any payments or defaulted on anything.

While writing this I've discovered that dispite cancelling a Direct debit on the 19th July they carried on & took the payment out thus making us over our o/d limit........ not happy!!:mad:

I honestly cannot see a way out of this & it's begining to affect everything, I've done full budgets & unless we stop living completely I can't see how we can reduce our debts but I'm desperate not to refinance and go from owing £23,000 to £38,000 overnight??

ANY advice gratefully recieved,
(thanks in advance)

talana

The first advice always on this board is to post a full SOA - difficult to offer specific advice without seeing your full budget.
You say you've already done one, so transfer the figures to an SOA, post it here and people will certainly offer help.

http://www.makesenseofcards.com/soacalc.html

bottleofred

Hi MrsGibbs,

Surprise surprise the bank has offered to give you money to clear the debts, but it'll cost another £15000 on top of what you already owe! You should have asked him if he thought you were as stupid as he looked! You need to put on your statement of affairs so advice can be given on your current outgoings and people with more knowledge than me can provide help and advice. Well done on not accepting the loan option and good luck on getting an acceptable resolution.

Tixy

Hi

They have offset money from your bank account to make the payment - they are allowed to do this whether there is a DD in place or not. First recommendation would be to open a new bank account elsewhere to have your wages paid into etc to protect you from anymore offsetting - eg as they are now aware you have money problems they could potentially recall your overdraft swallowing an entire's months wages.

Then as others have suggested seeing your statement of affairs would be useful.

Please do not take on any further borrowing from this bank - far better to seek advice from one of the debt charities first.

If it comes to it a DMP would be a far better option than the loan they have offered you,

MadamMim2013

Here goes guys.... hoping I've done this right..

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 2
Number of cars owned.................... 2

Monthly Income Details
Monthly income after tax................ 280
Partners monthly income after tax....... 440
Benefits................................ 888.17
Other income............................ 175.82
Total monthly income.................... 1783.99

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 320
Management charge (leasehold property).. 0
Council tax............................. 110
Electricity............................. 73
Gas..................................... 0
Oil..................................... 0
Water rates............................. 35
Telephone (land line)................... 25
Mobile phone............................ 20
TV Licence.............................. 12.12
Satellite/Cable TV...................... 20
Internet Services....................... 25
Groceries etc. ......................... 220
Clothing................................ 10
Petrol/diesel........................... 280
Road tax................................ 35
Car Insurance........................... 60.5
Car maintenance (including MOT)......... 50
Car parking............................. 5
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 20
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 3.13
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 10
Haircuts................................ 0
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 40.00
Total monthly expenses.................. 1373.75

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 1500.00
Other assets............................ 0
Total Assets............................ 1500.00

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
Loan...........................16888.....318.......0
Overdraft......................3400......0.........0
Credit card....................1555......35........0
Garage repairs.................1000......80........0
Total unsecured debts.....22843.....433.......

Monthly Budget Summary
Total monthly income.................... 1,783.99
Expenses (including HP & secured debts). 1,373.75
Available for debt repayments........... 410.24
Monthly UNsecured debt repayments....... 433.00
Amount short for making debt repayments. -22.76

Personal Balance Sheet Summary
Total assets (things you own)........... 1,500.00
Total HP & Secured debt................. -0
Total Unsecured debt.................... -22,843.00
Net Assets.............................. -21,343.00
Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission

Oh forgot to mention that both my husband and myself are self employed, hubby being in agricuture (mainly relief milking...) so things do change hours/income wise but normally down rather than up!!!

andrea1968_2

Banks are trying every trick in the book to rake in as much money as possible and send the people who are already making them profits (ie us) further and futher into the depths of the debt pit.:eek::mad::eek:

Change where your salaries are paid into so they can't automatically start helping themselves and don't take on another pounds worth of debt from them.

They are the devil in disguise.:mad:

Sorry for the rant and good luck !!!!

MadamMim2013

With the Direct Debit, surely it should be refused as it would take us over our limit... hubby's just had the same thing as his business acc was out by 13p (they wanted to charge him £35 fee!! kind bank man stopped it today...)

ooh just a thought, if my hubby's business bank acc is with them does that mean they could empty it to pay off debts??

RAS

Your income is incredibly low. Can I ask whether:

1. What expenditure exactly do you list against the business account - and how much is in that account.

2. Are any of the phone or vehicle based costs listed related to business expenses?

3. Have you spoken to any of the debt charities?

talana

Are you sure you haven't forgotten anything?
I only ask as on the face of it your SOA doesn't look too unhealthy as a start point. Put that £40 emergency fund towards the debt as I believe you should (think of this as your emergency) and then you actually have a small monthly surplus.
There's other things you could change too, so I don't quite see at the moment how you're struggling quite so badly.
Could you find out the apr's on the debts too?

MadamMim2013

RAS wrote: »

Your income is incredibly low. Can I ask whether:

1. What expenditure exactly do you list against the business account - and how much is in that account.

2. Are any of the phone or vehicle based costs listed related to business expenses?

3. Have you spoken to any of the debt charities?

Hi RAS,
Our income is fairly low, not for the want of trying though..
Hubby does relief milking currently around 16 hrs+ per week & I do 16hrs housekeeping, He gets roughly £220 a fortnight, I get £65 per week.
Out of his business comes mobile top up, fuel, NI, insurance for his truck & repayments to the local garage for the reapir work done!

I haven't known who to speak to as the Citizens advice is booked up till the end of August & any others I'm unsure of hidden agendas...

Talana,
the £40 under emergency fund is what's in my budget for my hubbys smokes, the logs/coal for the winter and some towards the kids uniform.. wasn't sure where else to put it??
Oh I also save £20 per month with park for vouchers to use over the following year for birthdays/xmas etc...

Thanks for the support, I'm so glad I didn't agree to the new loan... he gave me all the forms to fill out for the underwriters but I really don't want £38k of debt!

bottleofred

Hi,

You can get free advice from the consumer credit counselling service or nationaldebtline. The calls should be free from a landline and they are very good in offering help and assistance. You can also go onto the website of the CCCS for more information etc.