Can't see a way out....

sammyjo_3

any advice/help would be gratefully received.....

My husband has a lot of debts and as i try to help him, i'm scared i'll be getting more in debt. His biggest problem is that he has a loan with a monthly payment of £435 a month. Now this wasn't a problem before as he was early £21,000, he has now taken a pay cut down to £14,000 and we are struggling. He pays it every month and also his credit cards but I just dont ever see us being able to clear overdrafts etc. We have contacted Barclays who have said that as he no longer banks with them they cannot do anything. He has applied for a better interest rate loan with his bank now and was declined. He doesn't want to go down the line of an IVA.

What can we do?

HairyHandofDartmoor

Hi sammyjo, welcome to mse. You will get loads of good advice here.

The first thing you need to do is to post a statement of affairs (see southern scousers sticky at the top of the board) and then the kind people on here will be able to help you to save money. Don't forget APRs of debts and monthly repayments, so you can get more detailed advice

bluezone

Hi Sammyjo,

Welcome to MSE. As already mentioned above post your SOA on here and we will see where we can help you cut back on things. Another thing that be of help to you would be to apply for your credit report as this will show up you credit score and list of debts etc. Once you have all this information phone up payplan or cccs to ssee what they say (as they are the professionals! ) Obviously we can give you pointers and support all the way.

sammyjo_3

Is this what was meant, not too sure being new to all this....

Monthly Incomings:

Partners salary - £945
My salary - £1030
Total - £1975.00

Joint Monthly Outgoings:

Mortgage/Rent - £495
Council Tax - £110
Electric - £35.00
TV License - £11.98
Phone - £23.00
Food - £130
House Insurance - £22.00
Broadband - £12.99
Water - £24.00
Dixons - £4.59

Total: £869.06

Husbands outgoings:

Into Joint account - £320
Loan @ 10.9% - £435
Credit Cards - £110 (5.9 for life of balance) (which is about £2000)
Dell - £33.31
Petrol - £30.00
Savings - £40

Total: £929.33

Overdraft - £1200, normally at least £950 overdrawn 9.9%

My outgoings:

Into Joint account - £560
Credit cards - £150 (6.9 for life of balance) (which is about £4200)
Savings - £100
Car insurance - £21.00
Petrol - £30

total £861.00

Overdraft of £1000 at least always £950 overdrawn at 9.9%

bluezone

Hi again,

Stop paying into savings accounts at the moment as you pay more interest on your debts than you do on savings. This would give you an extra £140 a month between you to throw at debts.

rchrisp

your joint account expenses look pretty reasonable, so thats good. is there any way you can do 0% balance transfers?

HairyHandofDartmoor

That's it. Initially I would suggest stop saving money and throw this money at the debts, choosing to concentrate on the one with the highest APR. This is because you will be paying a lot more in interest on the debts than you will ever earn on your savings.

The loan at 10.9% is costing you a lot of money. How long is left to run on this? What is the amount to Dixons of £4.59? Is this some kind of insurance because you may be able to cancel this if so. I'm sure you will get some more advice soon from more experienced people.

sammyjo_3

I have thought about stopping saving but then i get scared and think what if maybe i need some rainy day money, but i think it sounds like the best solution at the moment as £140 a month is a lot.

As for the Credit Cards we haven't tried for a while to be honest, thought maybe we were best sticking with the life of the balance transfers.

My husbands loans has another 5 or 6 years to run..... a long time paying £435, just can't see any alternative with that though.

The Dixons thing is a cover yeah for our washing machine, we can cancel it, but it seemed a good deal, probably not though.

Does anyone have any suggestions for the loan, this seems to be the biggest issue.

Zulu_Dawn

Can you provide any more details about the loan?

It may be you can have a small payment holiday to allow you to clear some other debts or negotiate an extended repayment period at a lower rate. 10.9% seems quite high to me for a loan of that magnitude. We just need a bit more information.

ZD

HairyHandofDartmoor

I would cancel the Dixons insurance if it were me (unless it is about to go wrong!) I would stick to life of balance on the credit cards if the interest rates are low.

Loans can be difficult to refinance as there are often penalties. People often suggest saving money in a savings account and using this money to pay off the loan quicker, thereby saving a ton of interest.

Is there any way you could earn more money by flogging stuff on ebay, getting a part time job, doing some overtime, etc, and then save up to pay off the loan a bit quicker?

sammyjo_3

We tried to speak to Barclays and they basically said as he was no longer a customer of theirs (he closed his account a while ago) there was nothing they could do, or in other words they weren't prepared to help! I don't think it has a payment free period but will double check. As for the apr, 10.9% is loads but that is all they would give....... i feel like i'm constantly banging my head against a brick wall!