Advice on Making Arrangements to Pay...

SirNoseD'Funkalot

Hello. I hope that someone can help me...

A recent change in circumstances has left me unable to manage my money any more. I am over-committed, have no savings left, and have started to build up some arrears.

I have pared down my lifestyle to the absolute minimum, and renegotiated my phone and utilities. I am fairly confident that I am not wasting money anywhere, as I have analysed every single element of my lifestyle.

I have prepared an Income and Essential Expenditure Sheet. I’ve included Rent, Council Tax, Insurance, Phone, Gas/Electricity, £25 for food and £10 for travel as essential weekly expenditure. Even with the lifestyle changes, I’m only left with around £15/week surplus cash to put towards my other expenses, which are as follows :

Credit Card - £924.40 (I missed my payment last month and have incurred a charge for this, which is a nightmare…)

Store Card - £212

Mail Order Catalogue - £376.



Obviously, I just am not in a position to pay these amounts, even the minimums. I was wondering if there was any facility for me to write to these three creditors, enclosing my financial statement, and ask them to ‘make allowances’ for want of a better phrase. Do creditors ever agree to freeze interest charges for people in my situation? I could potentially pay around £3/week to each of these, leaving me a fiver or so for emergencies. I would ensure that this continued faithfully to keep reducing the balances; I have cut up my store card, (although I’m a bit afraid to cut up my credit card in case an emergency arises, as I no longer have any money in the bank...)

Anyway, I feel embarrassed to ask this of the creditors before knowing if it’s something that’s at all possible. Also, would it help if I asked an ‘official’ to do this for me, eg. someone from the CAB?

I’m staying hopeful that I will be back to fulltime work at some point in the future and things will pick up again, but for now I need to start dealing with these issues.

Any feedback would be very much appreciated.

Thank you…

fatbelly

Yes, the CAB could help.

But you're in a position to pay £65 per month towards debts of £1512.

Minimum payments on a credit card are usually 2-3%, i.e £30 - £45 per month, so i don't think you're in as difficult a position as you think.

Set up a direct debit on your c/c for the minimum payment (so you don't forget) and transfer your store card to it (assuming the apr is less on the c/c than the store card. If the catalogue is also higher, then ask to pay that by c/c too.

Mike sure you're not paying for insurances and try to apply for a low apr card like hsbc or m&s.

You can sort this out without a default, without spoiling your credit rating and without a lot of harassment from your creditors.

Good luck!

Do you feel like posting your income/expenditure sheet?

justruth

Also as you are scared to cut up the CC as you see it as useful for emergencies, I suggest you put it in a tub, cover it with water and freeze, this way you have to wait for the card to defrost before using it.

SirNoseD'Funkalot

Thank you both for replying. I guess I do have a full £15/week to put to my debts, but I'm terrified about what I'll do if/when an emergency arises, as I have absolutely no other resources.

I just had no idea if it was acceptable to phone my credit card company and try and renegotiate my terms, as if I'm paying the minimums, am I not really just paying the interest, so the debt doesn't reduce? I was wondering if they'd consider putting a freeze on interest to help me clear the balance?

Anyway, I went to library last night and spent about 4 hours surfing these forums and I think I've learned an awful lot. Also, I feel a bit guilty/ashamed for making a big fuss when there are people on here who owe tens of thousands of pounds. I'm going to knuckle down and phone HSBC this morning to see what they say, and I will ask about transferring my other two debts onto this card.

If I don't get any joy, I may ask the CAB to have a look, and see if they can offer any additional support.

Cheers again... )

CLAPTON

you need to post your income and expenditure before advice can really be given.