Don't know where to turn

on_the_right_track

This is my 1st post so please be gentle I really really need some hep. I've got myself into a horrendous situation & I don't know what to do. I have around £30k of debt & I have no way of getting out of this mess. Until recently I had a good paying job and was able to meet the minimum repayments on all of my debts. My job was in sales and I was terrible at it, I was very unhappy as it was extremely stressful and as I was so bad at it I was on the road to being sacked. I decided to leave as I couldn't take it anymore. I now have another job but the pay is terrible and I have different hours every week so my wages will vary from month to month.

I am going to calculate everything shortly but I think that roughly my income is going to be around £780 a month and my outgoings are around £800 without factoring in food etc. On one hand I am happier as I have a job I enjoy but on the other hand I am making myself ill as I just don't know how I am going to cope. This month has been the 1st time in my life that I have been late making a payment to my debts and I know worse is to come.

I'm going to get all my paperwork together and find out exactly how much I owe. I would be very very grateful for any advice that anyone could offer.

Thanks for reading. x

Hannah_10

You're doing exactly the right things by getting together your income, expediture and total debts. This is called a Statement of Affairs (SOA) and to help you here is a really easy SOA calculator. http://www.makesenseofcards.com/soacalc.html

CH27

Post your SOA & people will happily help you.

Well done on taking the step to post:)

on_the_right_track

Thanks for replying Hannah_10 & CH27.

I don't pay most of the things on the statement of affairs link as I live with my parents but here is what I do pay (hope I've set this out ok)

1. Rent - £200
2. Mobile - £30
3. Petrol - £150
4. Halifax loan - £253.09
5. Tesco loan - £200.66
6. Halifax credit card - £30 (minimum payment)
7. Halifax overdraft 1 fees - £31
8. Halifax bank account charge - £12.50
9. Santander overdraft fees - £31

The above amounts to £938.25 and that's before I factor in paying off the credit card/overdrafts, and also money for car repairs, birthdays etc.

1. I live at home with my parents who are on low incomes so I really can't drop this any lower
2. Contract until Jan 2010
3. I work as a home carer travelling between service users homes, getting rid of the car is not an option as I would lose my job
4. Outstanding is around £15,944.67
5. Outstanding is around £11,036.30
6. Outstanding is around £2, 970 (interest free until July)
7. Overdraft is £2,490 & I'm charged £1 a day for this
8. Overdraft here is £290 if I change accounts I won't pay £12.50 but be charged £1 a day
9. Overdraft is £2,800 & I pay £1 a day here also.

Total debt therefore is just over £35,500 which is even worse than I 1st thought

WhiteHorse

Have you attempted to negotiate with your creditors, or are they in the dark regarding your situation?

on_the_right_track

WhiteHorse - I haven't contacted them as I don't want to make the situation worse as I have no idea what I'm doing/what I can offer them. I did get a letter from the Halifax advising I should perhaps contact their money management department which I did but they were only really able to see if there was any other products which would suit me better but it turns out there isn't so I was no further forward

x

dancingfairy

You've got it a bit upside down here - let me help;
Income - 780
outgoings:
essentials
1. Rent - £200
2. Mobile - £30
3. Petrol - £150
4. Food - do you pay just for extras or do you buy all your own food or just add extra to the rent?
5. Entertainment/Presents etc
6. Car insurance/Mot/Repairs fund - yes you will need this
7. Clothes?

Right now how much is left to pay your debts? By my calculations your min. debt repayments are over 500 a month- even if you didn't buy any food, entertainment or anything apart from rent, mobile and petrol you would be 100 a month short at least. I am assuming none of your outgoings will be extravagent so therefore you have 2 main options:
1) increase your income somehow.
2) default on your debts, set yourself a realistc budget for living as you won't be able to get any more credit for a while and see what debt solution is for you.

Points to remember
1) your creditors can't have what you haven't got - it's pretty simple.
2) you can get help and advice from places such as national Debtline, CCCS or your local CAB but avoid those places that say they will 'write off your debts' use 'little known government legislation' or promise the earth in any other way. You need free impartial advice.
3) Your options are likely to be a dmp (debt management plan) or possibly an IVA or Bankruptcy but whichever options is best you will need a realistic budget and planning to never have to spend money on presents, car repairs, clothes etc is not realistic and will throw your budget out before you've even started.

df

iolanthe07

You may want to consider bankcruptcy, but do take professional advice first.

dave_2011_2

i got into a lot of debt couple of years ago and was paying out more than what i was getting in, so i got intouchwith them all and most of tem froze them and i said how much i could afford to pay which they should agress as at leaste your making a effort in paying!, maybe you can also look at debt management but make sure you go to the right ones as some you might pay say 150 a month and they pay your creditors but they only pay say 100 to your creditors and take 50 a month for them selves which means your getting more in debt but know your paying less each mont and not getting out of control. try your best to speak to each debt and try telling them you have other debts and what you can afford and if they can freeze it even if odd debts froze it for few months will help to wack money on other debts! also try paying your highest intrested debts first!

dancingfairy

o.k a dmp would see you payback something like 100 a month I guess (it's based on what you can afford after your living expenses are taken care of). This is going to take a while to pay off 35k this way - it's not impossible but will be a long slog for you.

an IVA is set for 6 years I think and again works out what you can affor to pay your creditors after living expenses.

The difference between an Dmp and an IVA is a dmp is informal and flexible whereas an IVA is more rigid and you have to pay fees for it to be set up and your creditors have to vote on whether to formally accept your proposal. Once it's set up both sides have to pretty much stick to it (there is a small amount of flexibility) but if you fail to make payments the IVA will fail and then bankruptcy is likely. 100 a month is 1200 a year for 6 years is what 7,200 in total? out of 35k it works out at 40% before you take into account fees so this is potentially a feasible option? Note you don't pay fees yourself it comes out of the pot

bankruptcy - debt gets wiped off - you have to pay fees up front - approx 600 I think (not 100% sure). You are allowed living expenses and any spare has to be paid into your bankruptcy - I think it's for 3 years (there are rules surrounding this but that's the gist).

I've given you a brief (very very brief) overview of the situation but do get in touch with one of the debt charities and they will go through it all with you or keep posting on here and people will continue to advise you.
df

dave_2011_2

also i would say if your using a card sy with a bank like hsbc or halifax and your going into your overdraft each month then get a account with barclays that has NO OVERDRAFT then get your wages payed into that account and and then pay off odd money from that account to the overdraft account, you will just go deeper and deeper into debt if your in a account thats in overdraft all the time! i changed and almost payed off my overdraft account and paying off my debts better!