Finally Snapped today

determined_new_ms

Hi sorry to be the bearer of bad news (and jump on the bandwagon) but what I say is with kindness in my heart & without judgement...

Have you first of all looked into unenforceability? There is a thread on this forum that explains it all.

2ndly I think it has only been the day to day scarifices that have taught me to value money & the things I spend it on. Its still a struggle to scarifice something I *want* and work out if I can afford it this month, what I will give up to have that thing or save for it month by month. Its a silly thing but there are 2 items I want to get after payday, neither of them are expensive but I realise if I want both I have to give up something else, cut back or choose which I would prefer this month & wait until the following month for the other thing. I think this lesson can only be learnt by paying off your debts over time, sticking to my budget & not going into my od not matter how broke I am, it takes time to develop a change in attitude.

My Grandmother left me £6500 in her will in feb last year & I paid off £5000 of my debt & got a new (to me) car. That left me with £1400 left of my debt. on Jan 1st this year I took a long hard look at my finances & I was back at square 1 with just over £6500 debt (I know this is small in relation to yours & other's debt). Being given a quick fix doesn't effect a fundamental change in your attitude, that takes time, practice & more than likely scarifices. Its a cliche but often real change is effected by real suffering.

Would you consider "borrowing" the 25k to reduce the debt & paying off the other 25k through your own hard efforts & then paying back your dad? If you haven't defaulted you should be able to do some shifting of the debts to get a better interest rate. Then when the time comes you will receive your inheritance (I presume this is what the 25k is about?) and it will mean more, and go further.

Best wishes x

Devils_Avocado

Pay off the taxman, then the cards (highest interest first), then the loan.

podperson

If all the payments have been up-to-date then it's unlikely they will agree to lower offers, you might be lucky and get 80-90% but the amount they accept is directly related to how high a risk they think it is that they get the full amount back. Since you have been making all the payments they think you have no problem is paying it back and they will get the full amount - so no incentive for them to settle and lose their interest Still always worth trying, guess you never know.
Regarding the loan from your father, I know some people have suggested it might not be the best idea. Not knowing you I'm not going to make a judgement on that, but I will just say that it is so much about attitude when it comes to debt. I consolidated a number of years ago but I still hadn't reached the point where I was willing to change my attitude and to say to myself that I didn't need to use the credit cards, that I didn't need to buy things on credit, etc. Needless to say the debt ended up creeping up again, just a little item on the credit card for 'an emergency' just a few items on the catalogue and I would pay them straight off - and you can end up worse off then we were at the start.
If you are happy that when you pay off the credit cards you can cut them up into little bits and not use again (and trust me it's actually quite liberating!) then sure take the money and save the interest. Good luck with it either way x

beanielou

Why should your creditors accept less for your debt?
As Sammy says this is not standard practise for someone who has not been in previous arrears & why should it be?

debtdesperado

Hmm. I'm kind of with the others in this, in that if you force yourself to actually go through the pain and discipline of paying back the debt, you will probably never get into that position again. It's definitely character building! I say this having started with a £42k debt (excluding mortgage, which it would scare me too much to include), which by the end of this year will be around £10k. This has taken 2 years to achieve.

With your dad's money, IMHO, I would pay off the taxman, and then pay off a chunk of your mortgage, rather than your credit cards. That will free up a chunk more money to pay off your debt.

Then I would do the debt snowball (google it) with your remaining debts and start on that. Perhaps look into a DMP if you must. Then I would start the long trudge to get debt free...post up an SOA, work out what you can sell etc...

It probably sounds harsh, but as much as I was ashamed of my debt, if my parents hard-earned life savings were going to pay off my champagne and designer clothes lifestyle, I would be REALLY ashamed - all your dad is contributing to is a windfall mentality which won't help you in future.

Pay it off the mortgage though, and your dad has contributed to your future security, and a valuable asset, and you have used his gift wisely.

persian_star

Snowball link: http://www.whatsthecost.com/snowball.aspx

a_desperate_man

Thank you all for your thoughts on this, however harsh some may be!!

I understand that the money from my father seems a bit of an easy way out, but the debt is not from free and easy living, the debts were built up when I started my business, this was designed to give my family a better life!!

Paying off my card accounts, will, free up £1350 per month of my income which will be channelled into clearing firstly the taxman, who, being self employed takes your tax in advance of earning the money, and who will be paid within 2 months, and will also be paid a fair bit in advance of January's bill.

As for trying to get a lower settlement figure, isn't that just good sense to try and save as much as possible after they have had alot more in interest than the original debt?

The 25k is not an advance on my inheritance, it is a gift I was apparently going to receive anyway, the other 25k is interest free and pay as and when, firstly I have to give my children a bit more of a life (fathers condition of loan!!)

My parents have retired, and at about the same age as myself were in debt from starting a business, they came out the otherside and have retired fairly wealthy, and are keen to give me a helping hand through this period which i very much appreciate.

All card accounts will be closed and no more credit taken as my level of income is more than sufficient to live without credit now.

Prior to this I had managed to clear a further 55k of debt, and no doubt would have eventually cleared all this, it just became a bit of a slog and I sopught assistance.

I by no means wish to rub anyones noses in it, I very much feel for anyone in a similar situation and wish them all the luck in the world with getting out of debt.