Credit card debt

homeless_and_helpless

About 2 years ago I was self employed but work has drooped of and is now none existant. I had a Virgin cridit card which is run by MBNA and i've been using it to pay bills i've not been able to meet while I find work but unfortunately this has been hard to come by. I have a 16 hour part time job at the moment but about 3 months ago I split from my wife due to the money pressures and i'm now travelling a 40 mile round trip to work which means I have to money to pay my credit card. I phoned MBNA to explain the situation and was told to pay what I could to stop the debt being passed on to a third party but last month I had no money to pay on the payment date and phoned MBNA to say as soon as I had some money I would call and make a payment. 2 weeks passed and I called to make a payment to be told that the debt had been passed to a third party. I called the company in question and told them my situation, they said I have until Friday 12th (tomorrow) to call and make a suggestion of how I am going to pay the £5200 outstanding balance or they are going to start proceedings to recover the debt from my assets ie my marital home. So where do I stand? My wife has been off work for 2 months with a nervous breakdown and I explained this to the debt company but they didn't seem interested, they probably hear excusses all the time. I'm going to advertise my car for sale which should sell for around £2000 but thats way short of the outstanding balance. Can I transfer the house from my name to my wife, the house is motgaged but there's probably £30000 of equity in it. My wife won't be able to remortgage because of her age? So any ideas, i'm desperate.

TIA

Tixy

Have you had a letter from the 3rd party debt collectors? or just spoken to them by phone?

Is this your only debt?

I would write to the 3rd party and enclose a token payment (even if its just £1) and say that you are seeking some advice regarding your debts. Then I would contact one of the debt charities for some advice. You need to work out a realistic budget as to how much you can afford to pay towards your debt each month in your current circumstances, and you'll then need to offer that amount, and make sure you pay it on time.

If the debt collection agency are not happy with your proposal then what they would do is start court proceedings to attempt to get a CCJ - if this happens you request to pay in installments and provide the court with your financial info so they can assess what you can afford.

The next step after this might be that they will try to get a charging order against your property - this doesn't mean your wife would need to sell or remortgage the house or could be forced to sell. All it means is that a restriction would be placed against the house that if you did sell the house then this debt should be paid from your share of the equity.

Suggested template for first letter http://forums.moneysavingexpert.com/showpost.php?p=21937969&postcount=51
Suggested places to seek advice on your debts (especially if you have more than this one debt) - IMPORTANT - Where to seek professional impartial advice about your debts.
Information on charging orders - http://www.nationaldebtline.co.uk/england_wales/factsheet.php?page=15_charging_orders_in_the_county_court
Interesting thread about charging orders when a property is jointly owned - Charging Order? The myth

MBNA are one of the creditors who at the moment are very keen to try to get charging orders but the key thing to do is to make sure you pay what you can afford (and at least a token payment each month), make sure you answer any court papers that turn up, and remember that they cannot take your house from you, and they cannot make you give them more than you have.

homeless_and_helpless

Thanks for the reply. I have the Credit Consumer Agency calling me tomorrow for an interview. I have only spoken to the 3rd party on the phone, they want me to call back tomorrow with how I plan to pay the £5200, they say they will then forward the proposal to MBNA.

girllikeme1

If you go to Citizens Advice they will be able to help you.

I once worked in a debt collection centre for Lloyds TSB. I guess this is the kind of place your debt may have been referred to (the 3rd party)? I worked there over 10 years ago but they used to take into account people's circumstances and would take very low payments from people as long as they were getting something. Some people were paying £1 a week.

Please don't despair - there will be a way to deal with this and I think your first stop is Citizens Advice, where they will have seen situations like yours regularly and will know what to do.