Debts = Regrets !

honeybeexm

Hiya,

I've been reading your forum for a while picking up some great tips and now I'm brave enough to post!! I'm really sorry about the long-ness of it!!

I stupidly got a Halifax CC in 2008, as soon as I turned 18 as I thought it's be a wonderful idea, I was earning £12k at the time and the limit was £2,800
Basically I decided it was free money and had a couple of months shopping/clubbing etc..

When it was maxed out and I was only paying the minimum every month, I decided to take out a loan (also Halifax) to pay off the CC - which i did, but then just maxed out the CC again and also spent the loan - don't even ask me on what because I don't know :-(

I buried my head in the sand for a while but struggled to keep up with payments. One day out of the blue I got a call from Debt Advisory Line and in one phone call I was then on a DMP.
I kept to this for a year or so, but then decided for some reason I couldn't do it any more and stopped the payments.
Long story but following this was about a year of me making payments occasionally, promising Halifax I would pay x amount on x date etc but really just pretending the problem would go away.

Nobody knew about my debt as I kept it all to myself, but a couple of months ago I confided in my boss and he made me an appointment with the CAB who have now made offers to Albion (Loan) and Moorcroft (CC) the offer for the CC has been accepted and I make my first payment on Friday. I think the loan will begin from next month also.

I feel a lot better that I'm doing something about it, but I just feel really down now facing up to the realities of it - I'm 21 years old and my debt totals about £13k and it looks like I'm going to be paying it off for many years to come!! (CC - £40p/m and Loan will be £150p/m - I make that about 6 years?!!) I know this is completely my fault and I should have to pay it back, its just so depressing thinking about my DIRE credit rating and no chance of building anything for myself until in 27?! I know it could be a lot worse but I just look at other people my age, and regret what I did so much!

I am lucky as I live with my parents (who do not know - they have their own big money probs and it would cause them a lot of stress) so i pay minimal rent and I earn ok money for my age (£22k) but I commute on the train for work which is extremely expensive. I also have a car (not on finance just an old banger) but insurance and petrol is £££££, I'm also paying off some short-term loans with Wonga and Payday UK (the devil I know) but these are nearly cleared. I also have a £400 debt with 02 that a friend paid for me which I'm paying off.. it all adds up...

ANYWAY - just wondering if anyone has any inspiration or tips for me just to keep me going?!

Thanks

KateMP

Congrats on facing up to it - scary I know but the first step is done - now just keep to it!!
Would it be worth selling the car and putting any payments towards debts? Have you already checked travelcards etc to make sure you cant reduce the costs by paying in advance? If you do keep the car try using cashback sites for insurance as it can help reduce the costs. I dont mean to be harsh but with £22k a year coming in and low housing costs do you think you can cut back anywhere else to increase your debt repayments? Maybe girls nights in, clothes swopping with friends, ebaying your old cds/dvds/jewellery etc (just trying to think what I used to buy when i got my first CC and did exactly the same as you!!). Good luck with it all either way!!

DizzyDizzy

Hello and welcome! We've all been there and are all mostly living daily with the regrets and "what was I thinking" momments!

Are all your loans/credit cards on the dmp? I would make sure they are all on there - that way no creditor can be seen as getting preferential treatment.

But look on the bright side - your only 21! and you will be debt free in 6 years if you stick to it!!! I will be nearly 40 by the time we are debt free. I wish I had found this site 10 years ago! After you have become debt free you will have the rest of your life to look forward to x

Tixy

Hi and welcome and well done for unlurking and posting.

Presumably you worked out an income & expenditure with CAB to work out how much you can afford to pay to the debt collectors? Is there anything on there you can identify that you could cut back on?

A 6year DMP is fairly average as a starting point, although I'm sure it seems a long time to you. Of course the best way to reduce this would be to see if you can make any savings so you could increase your payments or put some savings aside in the hope that you might be able to settle the debts earlier.

Once the payday loans are clear would you be able to increase your repayments to the other debts? if you commute to work by train is a car essential (rather than just nice to have)? Could you sell it to save yourself the insurance, tax, petrol and maintenance costs? Or maybe SORN it for a while so that you are not paying anything out on a monthly basis?

As a tip if you find you are struggling to live to your new DMP budget, as agreed with CAB, I find it really useful to keep a spending diary to keep track of what I spend (and to see those little spends really add up over a month).