what happens if you cant afford your credit card bill

GothicStirling

amandak wrote: »

thanks i will ring c a B
im so worried i have to pay rent untilities and eat and i have kids i have no savings and yes im scared they will turn up on my doorstep without warning. i have nothing of any value im scared a debt collector will not beleive me and camp out on my doorstep can they do that? its my word against theres isnt it? can they force there way in?
i cant see how i can ever pay it off to be honest i thought i was doing right thing by telling them i was honest with them

You pay rent and buy food first. The CC company can do one.

A debt collector isn't going to knock on your door. A CCJ is always the first resort for a Judge. At the end of the day, you're on benefits through no fault of your own. The law is on your side.

amandak

i live day by day now. i can barely manage as it is. theres no way i can pay a debt colelctor and dont they add interest? what after 6 months they decide they want to resume min paymemts? which were £320 a month? i cant really afford £30 i just agreed to that to keep them happy. all jobs i apply for seem to be part time and rubbish money it would never be enough to cover c card bill with low wages. i have to feed my kids. eldest may be at uni but she commutes, its the next town, so she comes back home and she finishes term in april until oct so she will be back fulltime i still have to find money to feed her, as it is i dont put the heating on we live in dressing gowns and hot water bottles. the house is always freezing. but i cant affird to heat it.

Russe11

When having large rolling balances on cards, is it wise to have some sort of insurance if for instance somthing goes wrong like losing a job.

Or

Is it just better to agree a reduced payment/interest freeze on the balance at the time a problem arises?

Tixy

Amanda

It doesn't matter if they decide they want you to resume £320 payments. You cannot pay what you don't have, and even your creditors will recognise this if you go about things correctly.
You need to get professional advice from one of the charities and you need to draw up a sensible statement of affairs showing what money you have coming in and going out - this will then demonstrate you cannot afford your minimum repayments.
As you are on benefits the debt charity will probably recommend you send your creditors a token payment of £1 or £5 per month, not £30. Usually the creditor will agree to freeze interest.

Then if in the future you find work the charity will reassess your finances and work out how much you can then afford to pay. If its a low paid job then it might still be less than the minimum but that will still be okay.

Make sure your eldest is getting all the help she can with Uni costs etc, if she is getting students loans etc then she should be able to use a little of that to help contribute to her food costs etc even if not the rest of the household bills.

Tixy

Russe11 wrote: »

When having large rolling balances on cards, is it wise to have some sort of insurance if for instance somthing goes wrong like losing a job.

Or

Is it just better to agree a reduced payment/interest freeze on the balance at the time a problem arises?

Depends on your own circumtances, the stability of your job, whether you can afford the insurance and how important your credit report is to you.

Rather than just take out loan insurance with the card I would also look at independant policies before you decide which if any to buy. These often work out cheaper and if you need them to pay out you also get to choose what you spend the money on.

If you don't have insurance and have to pay reduced payments and ask for interest to be frozen then this will wreck your credit file for years. For some that is unavoidable. If however you would expect to find work within 12months and would be in a position to continue to meet all your other outgoings yourself in the meantime then having insurance could help as it could preserve your credit rating.

redpete

amandak wrote: »

eldest may be at uni but she commutes, its the next town, so she comes back home and she finishes term in april until oct so she will be back fulltime i still have to find money to feed her,

Any reason she can't start paying her way? Her student loan will include a proportion to pay living expenses and she could look for a job in the summer.

izools

amandak wrote: »

i live day by day now. i can barely manage as it is. theres no way i can pay a debt colelctor and dont they add interest? what after 6 months they decide they want to resume min paymemts? which were £320 a month? i cant really afford £30 i just agreed to that to keep them happy. all jobs i apply for seem to be part time and rubbish money it would never be enough to cover c card bill with low wages. i have to feed my kids. eldest may be at uni but she commutes, its the next town, so she comes back home and she finishes term in april until oct so she will be back fulltime i still have to find money to feed her, as it is i dont put the heating on we live in dressing gowns and hot water bottles. the house is always freezing. but i cant affird to heat it.

Like I said, they'll review your circumstances after six months and accept whatever you can prove you can reasonably afford.

You send them another income and expenditure sheet, detailing your benefits and any other income you may have, and reasonable household costs including rent, utilities, food, travel, and even upto 40 a month for clothes etc etc and whatever you have left over after comfortably covering all the essentials is what they are bound by law to accept.

Debts only go to court / CCJ / Bailiff etc if the debtor point blank ignores the creditor and makes no efford to show they can only afford a pound a month etc. You are not this sort of debtor so you have nothing to worry about.

Remember -

No court, creditor, or collection agency in the land has the right to extract more money from you than you can prove you can reasonably afford. It is really that simple.

amandak

thank you so much i feel better now
i lived in fear there would be a van outside my door with 2 big men waiting
so if after 6 months im no better off i write to them and explain hope they l be ok with that

izools

amandak wrote: »

thank you so much i feel better now
i lived in fear there would be a van outside my door with 2 big men waiting
so if after 6 months im no better off i write to them and explain hope they l be ok with that

Exactly.

Referring back to my mother's Barclaycard example, at the time she had an 8,400 balance and was also on benefits, they accepted #20.00 a month and froze the interest. She has steadily ramped that payment up over the years in line with affordability, under no pressure from Barclaycard, and now has the balance down to under #1,000 -

Last year she brought the account out of an arrangement to pay so she is now paying interest, but is also able to get credit from elsewhere now that she has been making the original contractual payments for 12 months ish.

It can't have affected her credit rating that badly as she was accepted for #5,600 Mastercard from RBS three years ago and just last week was accepted for a First Direct current account and their Credit Card - FD being known as one of the strictest banks on the market.

So, as long as you keep HSBC up to date with your circumstances every six months and continue to make the monthly payments you agreed you could afford, there really will be no problems whatsoever. Absolute worst case scenario they may default the account after 6-12 months of reduced payments but this simply means you'll pay your agreed monthly figure to a debt collection agency, rather than HSBC. From your perspective, all that means, is changing the account number & sort code your standing order is set up to. Nothing else

property.advert

izools wrote: »

Exactly.

Referring back to my mother's Barclaycard example, at the time she had an 8,400 balance and was also on benefits, they accepted #20.00 a month and froze the interest. She has steadily ramped that payment up over the years in line with affordability, under no pressure from Barclaycard, and now has the balance down to under #1,000 -

Last year she brought the account out of an arrangement to pay so she is now paying interest, but is also able to get credit from elsewhere now that she has been making the original contractual payments for 12 months ish.

It can't have affected her credit rating that badly as she was accepted for #5,600 Mastercard from RBS three years ago and just last week was accepted for a First Direct current account and their Credit Card - FD being known as one of the strictest banks on the market.

So, as long as you keep HSBC up to date with your circumstances every six months and continue to make the monthly payments you agreed you could afford, there really will be no problems whatsoever. Absolute worst case scenario they may default the account after 6-12 months of reduced payments but this simply means you'll pay your agreed monthly figure to a debt collection agency, rather than HSBC. From your perspective, all that means, is changing the account number & sort code your standing order is set up to. Nothing else

I know from personal experience that HSBC never used to send data from their own credit cards to any agencies if you were an account holder / premier account holder. If that were still the case, then any default or arrangement would simply be an internal matter for HSBC.