MBNA help or other advice?

AKA963

Hi
We are fairly new to the site, never posted before but need some advice. Got a CC with MBNA totalling nearly £11k. The monthly payment is around £200 and whilst this is manageable, it is only knocking £5 per month off the balance and some months the balance actually goes UP a couple of pounds! How are we ever going to pay this off? I have heard that MBNA are not the easiest people to deal with and they have said several times on the phone that they 'cannot reduce the interest' (currently 20% pa). :mad: We have debts with other loans and CC totalling £40k. We can just manage all monthly payments but will be paying until the day we die at this rate and the prospect of not having any money left over at the end of the month the treat ourselves for the rest of our lives is saddening. Any advice out there???

Hannah_10

You've got two main options.

1. Find some more money, by increasing your incomings and minimising your outgoings to make a greater amount of surplus to pay your debts with then make overpayments.
2. Say "f*** this, I've had enough, stop the ride I'm getting off" and go into a DMP (debt management plan). Right at the start of this you would write to all your creditors telling them you are setting up a DMP and will be paying them on a pro-rata basis what you can genuinely afford.

If 1 is possible if it's preferable, if not there is always 2. How to decide is to do a SOA (statement of affairs). See this here... https://forums.moneysavingexpert.com/discussion/107280

vix2000

I am in a similar position to you with MBNA and would rather try to pay the debt than go on a dmp.

Do you think that MBNA would consider putting the balance on a life of balance rate? I have wondered if this would be an option for my debt and if they would rather do this than risk losing money with a dmp?

Or would they not care?

Hannah_10

What do you think a DMP is out of interest Vix2000? Because how you think they could risk losing money that way is something I can't work out.

You seem to be regarding MBNA as logical, sentient beings. You're not going to be treated rationally unless you force them to, it's not like owing the milkman who will listen to reason. You're just a number in a system and you wont be considered as a whole package.

Sad isn't it. But true.

jcorbygas

OP - the reason that we had to start our DMP last month was because of MBNA. The crippling interest payments each month to them on 2 credit cards and only paying a tiny amount off the balance got too much in the end as they had kept increasing interest rates.
As previous poster says, you need to do a SOA to check whether you CAN actually afford to pay all your monthly credit card repayments and if even by economising on things you find you cant you could look into a DMP.
I would say however that when we started being late/missing payments to MBNA eventually a reasonable sounding man rung and said that if we were having difficulties there might be a chance of a reduced payment plan with themselves but of course you would have to show them a full budget first.
They have not accepted our payment amount via CCCS but have stopped interest and charges at the moment.
It is very counterproductive of them to keep upping the rates as surely some amount of interest being received is better than none (in our case) or not getting paid at all in the event of bankruptcy!

Sunnylooloo

Hi

I don't have a debt with MBNA. I have organised my own DMP which most creditors seem OK to set up (esp when they see you have missed a payment) most of mine have either frozen or reduced interest hugely so I can see my debt going down each. All the time you are making the regular minimum payments they won't be intetested in helping (from my own personal experience that is).

Good luck

goingforward_3

vix2000 wrote: »

I am in a similar position to you with MBNA and would rather try to pay the debt than go on a dmp.

Do you think that MBNA would consider putting the balance on a life of balance rate? I have wondered if this would be an option for my debt and if they would rather do this than risk losing money with a dmp?

Or would they not care?

I dont understand... if you go onto a DMP MBNA will get back every penny you owe..

The idea of a DMP is that you fully pay back every penny you owe but hopefully they freeze interest so you become debt free much quicker.

vix2000

goingforward wrote: »

I dont understand... if you go onto a DMP MBNA will get back every penny you owe..

The idea of a DMP is that you fully pay back every penny you owe but hopefully they freeze interest so you become debt free much quicker.

My friend had a total debt of £22000.00 and was paying over £450.00 a month. She has just had a dmp accepted and has to pay £150 for 5 years, (ie. c.£9000.0). So how are they getting back every penny she owes?

ever_the_optimist_2

OP - I had 2 CC's with MBNA, costing about £450 per month. My ex cut my maintenance overnight by 90% so I had no way of paying them.

I initially went to the Citizens Advice Bureau who contacted MBNA on my behalf telling them that I couldn't afford the payments any more, with a proposal of something like £29 per month. MBNA responded with a stock type of letter saying this wasn't enough however when I phoned them and gave them all my income/outgoing figures, they agreed (very easily) to reduce my interest to zero % and spread the whole amount (£15kish) over 10 years (this is the maximum term they will agree to, and the reason they rejected the CAB offer). My payments are now approx £140 per month but my balance comes down every month because no interest is being added.

I have been paying this way for over 18 months now and they have not hassled me at all ... I was so pleasantly surprised by their help.

Obviously I cannot use my CC's any more and my credit file shows that I am behind with my payments.

My advice would either be to go through the CAB or just use the same approach yourself - write with a statement of your income/outgoings and proposing an amount roughly equal to the total repayable over ten years.

GOOD LUCK !

Miss_Poohs

vix2000 wrote: »

My friend had a total debt of £22000.00 and was paying over £450.00 a month. She has just had a dmp accepted and has to pay £150 for 5 years, (ie. c.£9000.0). So how are they getting back every penny she owes?

I think you'll find your friend has a IVA not a DMP.

IVAs are very different - in that by entering one you are saying (in a different way from bankruptcy) that you are insolvent.

DMP are Debt Management Plans ie, usually pro-rata'ing your available money to pay debts, infull, to your creditors, which is essentially a mutual agreement.

goingforward_3

vix2000 wrote: »

My friend had a total debt of £22000.00 and was paying over £450.00 a month. She has just had a dmp accepted and has to pay £150 for 5 years, (ie. c.£9000.0). So how are they getting back every penny she owes?

Then your friend is not on a DMP i presume she must be on a IVA. Iva's last for 5 years.

If your on a DMP like i am you pay back every you owe... my DMP is due to last 7 yrs but some peoples last much much longer.