Didnt think I wanted a DMP, but think I might now

monday_blues

Bettingmad hi, I done the debt remedy thing on cccs website last night and some of the allowances were more than i would have asked for i.e. groceries was 344 or something whereas i currently try and stick to 200. haircuts 33 i think it was (only had my hair cut once since july 11), i will keep that open on the laptop whilst on the phone to them just in case i get stuck. Roll on tomorrow x

Bettingmad

monday_blues wrote: »

Bettingmad hi, I done the debt remedy thing on cccs website last night and some of the allowances were more than i would have asked for i.e. groceries was 344 or something whereas i currently try and stick to 200. haircuts 33 i think it was (only had my hair cut once since july 11), i will keep that open on the laptop whilst on the phone to them just in case i get stuck. Roll on tomorrow x

Even if you don't currently make use of the available allowances make use of them when providing your figures. it will make the DMP more comfortable in the long run. As I said earlier it will mean the debt taking slightly longer to pay off but give me that rather than be cut to the bone and having a miserably restricted budget.

Did it give a date you will be debt free on the debt remedy?

eyeopener2

Hi

I am one of the ones who cut things to the bone and with hindsight would still do it again. It is tough, very tough but as i'm within touching distance now (ok it's 18 montha off but that seems quite close) i won't be changing it. I've survived the last 20 months on a DMP and longer before that with no money, as it was all going to creditors, so a bit longer won't kill me.

I hardly go out, I don't spend anything really and it does get me down sometimes but each month, as I update my signature and see the progress it gives me a lift and then I struggle though to the next month and so on.

Is this for everyone? No it isn't , but it has worked for me so far. I wouldn't recommend it.

You must use your budget wisely, think about what it is you want to achieve on your DMP, what is important to you and make sure you leave yourslef enough to live but at the same time you are making a significant dent in your debts. If you don't it will go on, and on and on.

Balance things sensibly and you will be fine.

E2

ps. Don't worry, everything will turn out fine once your settled into it.

monday_blues

hi eyeopener 2, well done on your progress to date. I admire you being so strict, I dont think I will be, I think our family need to learn how to live within our means, but have struggled for so long without a realistic budget, that to be honest I'm hoping for a bit of relax, by that I dont mean an easy life, but financially things been sooo tight for so long, and lately got to the point when not even doing a regular grocery shop. I have taken your comments on board though and intend to take your advice. thanks

I've just tried to do a bill payment online via my IF account and although there is money in the account, it wont let me do the payments??? Is this bad news already, have they frozen my account?

Poosmate

Hi Monday and welcome. Could you please tell if you pay your Council Tax over 10 months or 12 and as you have arrears will you still get the 2 free months if over 10 months?

Also, do you pay your water rates over 8 months too?

If you pay both with 2 and 4 months (respectively) free then you could over Feb and March use your CT and Water Rates spare money to pay off your two IF debts (£150 + £100) and also the knock a huge dent in the Next (£600) account which no doubt is one of the highest APRs.

Do you just have one current acct where everything is paid from?

I have 2 current accounts. Salary paid into one, no DDs from it. Transfer £xxx into second current account which covers all household bills (mortgage, CT, Water, Virgin (cable/phone/internet), BT, gas/elec, emergency fund, CC, overdraft). I know all of my household bills are paid for and what's left in my current account is what I have for shopping (groceries), clothes, petrol, spends.

Hope that helps.

Poo

Poosmate

Another plan:

How about you open up a Halifax Rewards account and have your salary paid into it (£5 per month free)? Set all of your DD's for your debts from this account (£730 from £1050 = £320).

Partner opens Halifax Rewards account and has his/her salary paid into it (Ker-ching another £5 per month for free). Set up all the DD's for your household bills from this. (I make that £1129.00 made up as so:- £650 mortgage, £235 CT, £35 elec, £60 gas, £12.50 tv, £40 sat/int/landline, £8.50 pet ins, £66 life ins and £22 build ins). I make what's left to be £89.

Open a joint current account and transfer £320 from your Halifax acct and whatever is left from partners acct after all bills are accounted for (£89). Also have the Benefits £120 paid into that account too. So you'll have £529 left in your joint account (+ £10 in your Halifax accts) when everything is paid for.

So out of your £529 (+£10) you need shopping = £225 and petrol = £150 leaving £154 (+£10) for everything else. Personally I'd put £50 in a savings acct for car tax/ins/mot and poss the free £10 from your Halifax accts too).

Your mobile phones really should be reduced (as others have said PAYG £15 each pcm max).
Your sat/internet seriously needs cutting as you currently pay £90 pcm for it plus landline. You could keep this but pay as little as £40 for a bundle - shop around.
Close Next acct, you can't afford to shop there any more.
Try to reduce your elec consumption. In your favour gas and elec prices are coming down - get used to using less before it goes up again!

You can reduce your groceries bill (drop brands, shop at 3.30 on a Sunday and bag some much reduced bargains (9p loaves of bread etc).

Sell stuff on Ebay to give you a bit of extra cash.

If you do it this way, the surplus cash in your Halifax acct should always increase as your minimum payments reduce. You could use this to make overpayments on your debts with the highest interest rates. Or use it to pay off Next first as that would free up another £60 quicker.

I hope that helps, I've found that being organised and compartmentalising these things is half the battle. Once everything is in place the money monster will more or less run itself. Its so much less stressful and will force you to live within your means and its so empowering to know that you are doing it.

If you can do it this way, your credit rating remains intact (or will improve it after this initial blip) and will open up 0% deals for you in the future.

This is how I do it (except I don't have a Halifax Rewards acct) and it works for me.

Sorry for the long post but hope it helps.

Poo

Poosmate

Doh! Sorry, me again!

I forgot to say. Things will get better, from April your Council Tax will be £35 less, either put this into your savings acct or pay it off your Next acct to free up that £60 quicker.

If you don't have to pay your council tax in Feb and March you could do as I posted in my first post or split it and put £100 per month into your savings account to give you a good head start.

Believe me, it really will get easier and its so rewarding to make those extra payments out of your surplus cash without having to increase your outgoings. The more surplus you get, the more you pay off your debt, the less interest you pay, the more surplus you get - it's a fabulous backwards spiral.

Good luck and apologies for any typos it's late and I need my bed!

Night all

Poo

monday_blues

Poosmate wrote: »

Hi Monday and welcome. Could you please tell if you pay your Council Tax over 10 months or 12 and as you have arrears will you still get the 2 free months if over 10 months?

Also, do you pay your water rates over 8 months too?

If you pay both with 2 and 4 months (respectively) free then you could over Feb and March use your CT and Water Rates spare money to pay off your two IF debts (£150 + £100) and also the knock a huge dent in the Next (£600) account which no doubt is one of the highest APRs.

Do you just have one current acct where everything is paid from?

I have 2 current accounts. Salary paid into one, no DDs from it. Transfer £xxx into second current account which covers all household bills (mortgage, CT, Water, Virgin (cable/phone/internet), BT, gas/elec, emergency fund, CC, overdraft). I know all of my household bills are paid for and what's left in my current account is what I have for shopping (groceries), clothes, petrol, spends.

Hope that helps.

Poo

Thanks Poosmate, you spent a fair bit of time responding to my post. To answer your questions:
We pay council tax over 12 months, + have a couple of months arrears hence the extra £35 pm we are paying.
We dont have water costs as in Scotland.
We have 3 bank accounts, one is where household bills come off, another for bill payments to creditors and a third is the santander account i have recently set up, but not really utilising it for any set purpose. my salary goes into that one, but then i transfer money around. santander said they would do the switchover for all direct debits, but they never, so.....

monday_blues

Well, here we go again .... Version 3 of my SOA based on interview with CCCS. She says we dont have enough money to sustain payments to creditors. This is recommended SOA realistic if to go down DMP route and if necessary to present to creditors. Some of the allowances I thought were high, some a bit lower. See what you think?

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 1
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 1000 not including overtime
Partners monthly income after tax....... 1218 not including overtime
Benefits................................ 120
Other income............................ 0
Total monthly income.................... 2338
Monthly Expense Details
Mortgage................................ 650
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 200
Electricity............................. 35
Gas..................................... 70
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 82 this is the cccs figure for mobile, internet and landline combined. We are currently 30for landline and approx 60 for mobiles. internet is free through mobile - so i know i've got some work to do here.
TV Licence.............................. 12.5
Satellite/Cable TV...................... 23
Internet Services....................... 0
Groceries etc. ......................... 300
Clothing................................ 60
Petrol/diesel........................... 150
Road tax................................ 20
Car Insurance........................... 30
Car maintenance (including MOT)......... 30
Car parking............................. 0
Other travel............................ 20
Childcare/nursery....................... 0
Other child related expenses............ 40
Medical (prescriptions, dentist etc).... 20
Pet insurance/vet bills................. 30 she said this figure to include food for dog, plus insurance
Buildings insurance..................... 22
Contents insurance...................... 0
Life assurance ......................... 66
Other insurance......................... 0
Presents (birthday, christmas etc)...... 30
Haircuts................................ 26
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 20
???? (written down £20 not sure whatfor 20 can't read my own writing, sorry
optician................................ 20
school lunches.......................... 20
food at work............................ 10
gas care................................ 10
club fee ............................... 50
Total monthly expenses.................. 2066.5

Assets
Cash.................................... 0
House value (Gross)..................... 190000
Shares and bonds........................ 0
Car(s).................................. 3000
Other assets............................ 0
Total Assets............................ 193000

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 140000...(650)......0
Total secured & HP debts...... 140000....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
abbey..........................9000......320.3.....0
barclaycard....................7000......80........0
barclaycard....................7000......80........0
if.............................150.......0.........0
if.............................100.......0.........0
bos overdraft..................600.......10........0
next...........................600.......60........0
if.............................5000......80........0
nationwide.....................5000......100.......0
Total unsecured debts..........34450.....730.3.....-

Monthly Budget Summary
Total monthly income.................... 2,338
Expenses (including HP & secured debts). 2,066.5
Available for debt repayments........... 271.5
Monthly UNsecured debt repayments....... 730.3
Amount short for making debt repayments. -458.8
Personal Balance Sheet Summary
Total assets (things you own)........... 193,000
Total HP & Secured debt................. -140,000
Total Unsecured debt.................... -34,450
Net Assets.............................. 18,550
Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission, using IE browser.


The lady suggested figures that we dont even ever consider, probably hence goes on cards eventually.

What do you think?
Is a DMP the way for us to go, opinions wanted?
or, Struggle on, credit rating already damaged I fear, and no additional credit available I dont think
or, consider this DAS arrangement?
or, self contact creditors and try and come to arrangements?
or, sell house (but scotland home report and mktg fee comes to around £800 before even on market - which we ain't got, and what if we don't sell - further into debt we cannot afford.

Many thanks in advance,

Poosmate

Hi Monday, sorry I don't know what a DAS is (I guess something like IVA south of the border?).

Did CCCS say that they won't represent you if even if you wanted to go on a DMP? I mean is that what they mean by saying you "don't have enough money to sustain payments to your creditors"? If so, did they suggest you go bankrupt?

Shame about you paying your CT over 12 months - I love Fab/Mar when I know I have that extra cash to bolster my emergency fund and the 4 months where I don't pay water rates too.

I think you've probably answered your own question regarding selling your house - do you want to move or is it really your "home"? Mind you, even if you did, looking at the figures your net assets amount to £18,500 that's including the car, so £15,500 then take out solicitors fees and the cost of moving £1500? Leaves you £14k as a deposit on somewhere else to live and a credit record shot to poo - you aren't going to get a very nice mortgage interest rate. ok so looks like you're staying where you are then.

Ok, so the next step is to reduce your outgoings, increase your income and make a start on getting those debts manageable and eventually GONE!!!

You do have some room for manouevre for reducing your outgoings. The two biggest leaping out by miles is your sat/int/phone package and your mobile phones.

Can you downgrade/size your car to give you a bit of cash to jump start you into reducing your outgoings?

Do you have anything you can sell on Ebay/Gumtree/MusicMagpie/whatever?

Can either you or your partner get a part time job even if only for a few months (again to kick start your debt busting)?

I'm sorry you bank at "Satan"der! It's one bank I would avoid like the plague I've heard so many bad reports about themand never thought they really could be that bad till I tried to pay some money into an account held with them.

I still believe you could turn this around by yourselves but it would take a lot of hard work and determination - you could have some fun on the way though by giving each other presents for birthday/Christmas like 6 months supply of toilet roll, or a few months supply of coffee (that should be your and your partner's little secret though - no one else would understand!).

Good luck and keep us posted.

Poo