Please Help!

SMC625

I have finally getting my head out of the sand with my credit cards and have added them up roughly below. I take home a wage of £1100 a month and am spending about £300 a month just servicing the debts I'm not exactly struggling to pay them at the moment but cant really pay consistently more each month. I can, and have asked my boss for more overtime but that cant be guaranteed.


Barclay Card £6200

Virgin Card £10000

Post Office £1100

I also have no savings or assets that I can fall back on.

I'm going to the Citizens Advice Bureau tomorrow but would like an alternative opinion.

This seems like an impossible mountain to climb

Tixy

Hi and welcome

The first thing we usually suggest to people is that they post up a statement of affairs, this lists income, expenditure, assets and debts and APRs and gives a good picture of your overall finances (to us and to you). This info would also be useful to take along to CAB.
We use this link to format the statement of affairs, it encourages people to think about all their expenditure over a year - http://www.makesenseofcards.com/soacalc.html

The other thing that would be useful to know is whether anything specific caused these debts, whether you made any large purchases that could be sold to put towards your debts, whether you had a period of unemployment or a reduced salary etc.

SMC625

Ok.... Here is a statement of affairs that I have done. I have, I admit done one that I THINK I could live on, rather than one I have been. My most recent bank statement shows I went to McDonalds at least 6 times:eek: I'm going to post a past SOA with things like that. Its amazing how much money I throw away on total rubbish that I put in my mouth. I suppose there is one good thing to come out of this I have already lost a bit of weight.


Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household.........
Number of cars owned....................

Monthly Income Details
Monthly income after tax................ 1300
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1300

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 120
Management charge (leasehold property).. 0
Council tax............................. 30
Electricity............................. 0
Gas..................................... 0
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 25
Mobile phone............................ 10
TV Licence.............................. 12
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 140
Clothing................................ 20
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 56
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 20
Haircuts................................ 0
Entertainment........................... 50
Holiday................................. 0
Emergency fund.......................... 0
(Unnamed monthly expense)............... 0
(Unnamed monthly expense)............... 0
Independent Payment Protection Insurance 15.84
Total monthly expenses.................. 498.84


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 0

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
Barclay card...................6400......144.......26
Virgin.........................6000......188.......29.9
Post office....................1100......25........19.9
Overdraft......................1200......0.........16.92
Total unsecured debts..........14700.....357.......-


Monthly Budget Summary
Total monthly income.................... 1,300
Expenses (including HP & secured debts). 498.84
Available for debt repayments........... 801.16
Monthly UNsecured debt repayments....... 357
Amount left after debt repayments....... 444.16

Personal Balance Sheet Summary
Total assets (things you own)........... 0
Total HP & Secured debt................. -0
Total Unsecured debt.................... -14,700
Net Assets.............................. -14,700


I have spoken to a Debt Advice Company "The Debt Advisory Group" who say they could get the interest frozen and the payments down to £275 a month Over a 5 and a half year period. My concern is that they charge a fee of £40 a month but having gone the CAB they say not to use them and go to the free charity ones. The Debt Advisory group said that they charge a fee because they are independent and as the free ones are funded by the Banks that they are influenced by this. As I have debt with MBNA who looking on this web site are very aggressive over a DMP that they would be more successful, Claiming a 98% success rate. I don't know who to believe. I don't want a DMP if I can turn this around my self.

mildredalien

Many people here have used the free debt charities with great success - not to be cynical or anything but I'm pretty sure that the private companies who want you to pay for their services will try and 'persuade' you to go with them by telling you that the other free methods aren't as good....

mildredalien

p.s. it might be a good idea to put your info into a snowball calculator to see how long it could take you to pay off your debts without a DMP. You will still incur interest charged, but you won't default on your debts if you can manage payments yourself. There should be a link to a snowball calculator from your SOA.

silkglade

Hi and welcome

Martin always advises to use the CCCS or national debtline as they are free and I believe government funded (not bank funded) I would advise most definitely to NOT use a company you have to PAY for the privilege as this will put months or years of extra payments on your debts for no reason as you can get this service free elsewhere.

Good luck and well done on making the 1st and very important steps

SMC625

I was thinking that myself. It put me as 29 months to clear it but I would rather clear the overdraft of quicker than what it says. I can also do over time at work which could bring in about an extra £250 a month. I have a 0% offer on the Virgin card for 12 months with a 3% transfer charge I was thinking about moving the Barclay Card debt over. If I'm right I can get the overall debt down by over £1000 in a year by doing this. Unless I'm wrong with this. Although I am paying Russia Roulette with this as if I fail its nearly all on the MBNA account!

The interest on all types of transactions with this card aree the same.

nottoolate

SMC625 wrote: »

The Debt Advisory group said that they charge a fee because they are independent and as the free ones are funded by the Banks that they are influenced by this. As I have debt with MBNA who looking on this web site are very aggressive over a DMP that they would be more successful, Claiming a 98% success rate.

lying swines :mad:

the reason they charge a fee is that they are out to screw as much money out of you as possible.

they will try to keep you in debt as long as they can. once you are out of debt their fees stop, so its not in their interest to help you clear it quickly

avoid any company that charges. they are just out for their own profits and will fib and cheat to get them.

eyeopener2

First of all.

Do not touch a fee paying company with a barge pole, they cannot do anything the the free (CCCS, Payplan,CAP) can do for free.

Secondly they are lying about MBNA, i've been on a DMP with CCCS for 18 months and MBNA have been great, never had an issue with them.

Thirdly, you have, if you stick to your budget a large(ish) surplus so you really need to stick to that. If you could throw £400 a month at your debts you would soon make inroads. Check out the snowball calculators to see what £400 a month on top of minimums make.

Lastly.............as you have been keeping on top of your payments its unlikely any of the creditors would accept the DMP, you have to fall behind a bit or miss payments for them to take you seriously.

Stick to your new budget, be tough for a couple of years and you WILL get out of this.

E2

SMC625

Do you think the balance transfer is a good idea? Are there any down sides to it?

I have done the card tart thing before and did close the account once it was clear. I WILL be doing this with the Barclay Card.

Standingtall

There do not seem to be hard and fast rules or even trends as to whether companies will freeze interest and charges. I panicked about MBNA when starting my DMP with Payplan. However within three weeks of it been set up I have received a letter for each of the credit cards I had with them stating that they accept the payment offers and that everything is frozen. Such a relief!