struggling with debt - not defaulted yet...

debtfree2015_2

Hi,

This is a bit of a long one, I have been lurking various threads but been too ashamed to post.

In 2008 I had only 1 loan. Over the course of 2009-2010 I built up debt escaping a violent ex. My pride took over and rather than run I stayed local so I could work which resulted in regular sudden moves loosing deposits etc each time he found me.

Late 2010 I realised I couldnt continue to do this so left my job of 10 yrs and 400 miles away.

Anyway, I am just about managing minimum payments on cc & loan, purely by living of a £18 shop budget and if I need things eg daughters school shoes, I wait until I have space on credit then buy. Just had my elect price review, I have storage heaters so not the cheapest - but I am with the cheapest for econ 7 so I know if I leave it much longer I probably will have a late payment. It sounds silly, but my credit rating is just about the only thing he didnt destroy, Ive managed to keep it under control by adapting my lifestyle, never defaulted or been late.

I have looked at DMP's by the CCCS plan I would be paying out £150 pm less than what I am now. Im reluctant to go down this route, as mentioned my record is good for payments. I doubt card companies would reduce interest as by the DMP, they would only get £5 less than what they do now, its the loan company that would be hit hardest even though they have the best interest rate! So I thought I would call the loan provider (m&s) and explain I was struggling, to see if there was away of reducing payments, I was told their collections dept would call me monday.

I wish I had phoned them monday now Im worrying myself silly!

Im guessing they might come back with an extention agreement, ie longer period with maybe an interest increase? If they do come back with this, is it likely to damage my credit rating? It was a 6 year agreement, 3 year mark was in July.

I made it clear to the lady on the phone, I have no intention of defaulting, as she thought I would be cancelling the dd now. I explained, I just wanted to prevent getting into that situation so thought it would be better to see if they can help first. I wont consolidate - wouldnt get through anyway as on a low income.

If anyone has ever had any help from a loan provider what did they suggest & did it affect your credit file, or is it just an amendment to the agreement?

I did try contacting my highest paying interest card, BOS, she said they wont help until I default 3 times!!! Which defeats the object of me trying to avoid DMP

Surely prevention would be better?:(

rising_from_the_ashes

Hi, welcome to MSE, you'll find loads of advice & support here.

First of all, I'd suggest posting a Statement of affairs http://www.makesenseofcards.com/soacalc.html which will show your income, outgoings & debts - it gives everyone a better idea of what's going on, where savings can be made etc.

Don't worry - it's sortable!

debtfree2015_2

Hi,

Thank you, think Ive done it right. Ive only just switched the phoneline over so I wont notice the £20 odd monthly difference until November. Last one was a cheap line but didnt include 0845 numbers in the free time.

Money comes in 4 weekly, so I multiplied by 13 & divided by 12 to get that figure, normally at the end of the year I have a + balance in my bank.

Havent included overdraft as it will be gone as of 1st Jan.

Statement of Affairs and Personal Balance Sheet
Monthly Income Details
Monthly income after tax................ 1339
Total monthly income.................... 1339[/b]
Monthly Expense Details
Rent.................................... 675
Electricity............................. 60
Water rates............................. 32
Telephone (land line)................... 22
TV Licence.............................. 13
Groceries etc. ......................... 100
Clothing................................ 5
Other travel............................ 25
Contents insurance...................... 13
Presents (birthday, christmas etc)...... 15
Total monthly expenses.................. 960[/b]

Assets
Total Assets............................ 0[/b]

No Secured nor Hire Purchase Debts
Unsecured Debts
Description....................Debt......Monthly...APR
loan...........................6333......175.9.....11.9
card1..........................1758......50........21.9
card 2.........................2718......70........16.9
card 3.........................2808......65........21.9
Total unsecured debts..........13617.....360.9.....-

Monthly Budget Summary
Total monthly income.................... 1,339
Expenses (including HP & secured debts). 960
Available for debt repayments........... 379
Monthly UNsecured debt repayments....... 360.9
Amount left after debt repayments....... 18.1
Personal Balance Sheet Summary
Total assets (things you own)........... 0
Total HP & Secured debt................. -0
Total Unsecured debt.................... -13,617
Net Assets.............................. -13,617

rising_from_the_ashes

A couple of very quick comments from me (my dinner's just about ready!:)) but I'm sure others will be along to help soon.

From a quick look, you're not "wasting" vast sums anywhere (I know when I did my first SOA, I was spending over £200/month on groceries - for me!).

Although you appear to have enough to cover your outgoings (although it's obviously really tight) I see you've not included your overdraft payment in these figures - which must mean you're not currently covering everything?

- Your rent is very high in proportion of your income (at over 50%) which is obviously having a pretty big impact.
- You've not included Council Tax?
- You've no childcare/child related etc included?
- Have you checked whether your entitled to any benefits (WTC etc), if you're on a low income you may be able to get something.

debtfree2015_2

Hi,

thanks for replying.

yep Ive included everything, not entitled to WTC until work goes over 16 hrs, so on IS at the time being (daughter under 5). I just use the one figure as I it calculated it on CCCS when I was looking at DMP. The figure is everything inc CTC & CB.

Im hoping that work does pick up soon as obv that will increase my income & WTC works out more than IS. I registered self employed 2 weeks ago, after a year of no luck job wise, Im am looking for a job now as the S/E is starting slow so I have plenty of time on my hands, but its pretty isolated here, no car, irregular & expensive public transport.

Most flats start at about 750 here, Im above a shop so its cheaper. In my old town I was in a 2bed house for £750pm, so Ive saved on my rent although had to downgrade quite a lot.

Daughter is in preschool so no childcare to pay.
I didnt include council tax as that is wiped out by council tax benefit, again until I come off IS.

I think I am going to have to be patient see what m&s suggest.

Ive coped for so long, its just my bills & food shop are getting higher and higher. I shop in Lidls which is fairly cheap and a walk away, cant get to the other big supermarkets, without paying £6.50 bus fare, that will wipe out any savings I would make with the value brands.

I keep thinking isnt that long away & if I can earn more money it will be over even sooner, I just dont know how Im going to get through this winter without defaulting or paying late - its my heating bills that will push me over the line.

Thats why I thought re the loan, my biggest payment, if I could lower it even by £20 it would make the month easier.... or a 2 month repayment break would give me an extra £29 a month for 12 months towards bills ie elec/food shop.

Il have to be patient and wait until monday fingers crossed for a good outcome

rising_from_the_ashes

Keeping my fingers crossed for you - as I say others will be around later on (Sat night and dinner-time ish). If your post falls off the front page, just "bump" it back up for more help. As you say, if you can try to increase your income it would help enormously - do you have anything you could ebay? (old clothes you/your daughter don't use anymore, toys etc). It's coming up to Christmas and I'm sure lots of people will be going down this route to try to save some pennies.

Re cutting down on groceries - pop over to the Old Style board as great help over there too. If you look at the October Grocery thread (sticky at top of board) there's loads of great recipes on the 1st couple of pages. Also, it may be worth doing a big shop once a month for cheaper items - the delivery charge can get down to £3 if you pick the right time to get it.

debtfree2015_2

Hi Rising,

I will pop over there today thank you for that.

After having a good look over my budget, it will be tough over christmas but as off January be fine.

I called M&S spoke to loans dept explained I wouldnt need collections calling me Id be fine, I explained its been a hard few months, nans funeral in france travel fees that I didnt have etc have had a bounce affect hence why Im struggling more now. I only would have needed 1 month reduced or something to make it easier. She then said, well you have got a month repayment break that you havent taken as yet. She said it was included in the T&C's as standard, for one month only, no interest, no marks added, just make up the payment at the end of the loan, she couldnt understand why the lady was going to get collections to call me as I hadnt defaulted or said I would default...phew thats a relief!

I haven't asked to take the break, Im going to see how I get on over the next few weeks but its good to know its there to take if I need it.

I think viewing my statutory credit report perked me up a bit, its good & Im determined to keep it that way :T