Advice needed for ex student

vw_campervan_mum

Hi everyone, I am looking for advice for my son who has given up his UNI course in Nursing having decided it is not for him. As yet he has no job and is coming home next week so at least he has food!

Until he gets a job what is best place to start with debts?
Student overdraft No. 1 - £1000
Student overdraft No. 2 - £500 (bank already asking why no credits and may call in overdraft)
3 Phone Co. £78 owed for phone-phone now blocked.

He also has to pay rent in Bristol til June - £360pm. His dad has stepped in (we are divorced) & paid 2 months already owed - so only 3 to go unless he can sublet. I rang landlord & they wont let us off payments but said would probably accept £200 per month til fully paid.

I have big debts myself so apart from offering free board & lodgings dont have cash to offer him.

Where does he start? I dont think he has talked to banks yet - what should he tell them. I fear he hopes keeping quiet makes it go away.

Thanks for any kind advice.

Hannah_10

In a lot of ways it's quite straight forward, he needs to claim benefit or get a job, then write to all creditors explaining his circumstnaces and making token offers (£1 or £2 a month) until his circumstances change. They'll rant and rave, but as long as the postal orders get sent (signed for post) then they wont get a CCJ against him or any other really negative outcome. The debt might go up while he is on token payments, his credit file will be defaulted too, but neither of those things are as big an issue as they first seem. The debt once defaulted will stop increasing, which can only be a good thing. It will get passed to a DCA (debt collection agency), who will also rant and rave, but as long as the payments keep arriving then rant is all they can do- he'll learn to laugh at them. Information can onyl stay on your credit file by law for 6 years and it doesn't affect anything really appart from getting a new loan. It'll take him longer than that to save a house deposit if he gets a good job tomorrow so it'll work out ok with a future mortgage.

As I said, in a lot of ways it's simple. What's not simple is that he's finding it really scary and avoiding it. This is where calling in National Debtline helps (see Debt Problems: What to do & where to get help). I particularly recommend ND over the CCCS or the CAB for your son because ND send out a massive thick paper book on debts, which you as Mum can also read and support him with. ND also have a free phone line and website full of respources. The CCCS mostly operate online and on the phone and the CAB have face to face appointments, which is too easy for him to either avoid or feel cornered by.

xLucyLoux

Hi Campercanmum

Just a thought...

I had problems with a house when I was at Uni (horrible housemates who drove me out of the house ) Did he sign a lease on his room, or did he sign a lease with all his housemates on the same agreement?

My ex housemates and I signed the 1 lease (all 3 of us signed the same agreement) as a result of this all 3 of us were liable for my rent when I moved out. I got some legal advice and was told to only pay a third of my rent while me housemates had to make up the difference until the room was let.

while I reaslise this might not be the best plan if he still has good relationships with this old housemates, it might help a little. Also has he advertised the room on campus? I know there were students on my course who lived in B & B all year as they couldn't find accommodation.

Hope this helps

x

dancingfairy

Further to the above I would suggest he opens a brand new bank account with a bank he doesn't owe any money to - he may have to have a basic account as these don't require any credit checks so he is more likely to get one. The ones that seem to be recommended are Co-op and Barclays - the key point is that it should not related to any bank he owes money to. The main reasons for this are 1) when he has a seperate bank account he is control of who gets paid and when so won't suddenly find his overdraf withdrawn which he was relying on or something.
2) banks can also dip into people's accounts to pay their own credit card so if he has an bank account with xyx bank and a credit card with them they can just dip into his current account to make sure the card gets paid - again causing more grief and agro. This is the rule for normal accounts -I'm not sure if student accounts have the same rules but frankly I wouldn't risk it and would just get a brand new account set up.
3) make sure all benefits etc go into the new bank account
4) you need to check carefully exactly what type of lease he has signed - whether it has any get-out clauses and indeed whether his failure to pay will impact upon other residents. Sometimes it is possible to get out of a rental contract by paying the rent/advertising costs until a new tenant can be found to take his place if he wants to get out of the contract earlier- obviously this is at the discretion of the landlord.
5) don't speak to creditors on the phone as they have been known to lie/bend the truth and if everything is in writing everybody knows where they stand.
Best of Luck
df

vw_campervan_mum

Thanks for advice so far. Will be sharing this with him when he gets back. I didnt think he would get any benefits so havent looked into that yet. Feel more positive now. Thanks again:)

Hannah_10

If he's unemployed and over 18 he should get benefits. Tell him to apply for JSA.