Getting professional help to beat debt. Diary

Getmeoutofdebt

14th March 2012

Posted my Cashflow letters and financial statements to MBNA, Barclaycard and Yorkshire bank visa. I couldn't send my letter to LLoyds TSB yet due to the fact that my transfer of bank account from Lloyds to Co-op is going to take a few weeks (getting wage paid in & direct debits swapped over etc) and its not wise to tell them that I can't afford to pay my credit card bill if my wage is going in to my bank with them.

I could have posted my letters sooner but in typical "Me" fashion, I have been flapping! Too scared to do it I suppose. Worried about the reaction I may get. The one thing that in the end made it easier for me to send them was the result of a few sums!
I was planning ahead, wondering how I will deal with my creditors replies to my letters, so I decided to work out what the difference in payments would be (i.e my minimum payments that I can't afford, against my new payment offers.)
I took my last credit card statements and listed
1) minimum payment,
2) interest charged,
3) the difference between the two (i.e the amount actually being knocked off the debt rather than the interest)
4) My new payment offer.
The results surprised me! I was expecting my new payment offer to be paying off less than my original payments..... but..... if my creditors freeze the interest, I will actually be paying off more a month than before, even though I am paying out less!
Normally, if I pay what the credit cards want me to pay, I shell out approx £600 a month. £380 of this last month was interest. So I only actually paid £220 off my debt. Whereas my offers to these cards as part of my debt plan total £339! So.... if they freeze the interest, I will be £261 better off and they (overall) will be £119 better off!
Knowing this gave me the guts to send the letters. Just seeing how much I am being ripped off each month with interest made me realize that I'd be a fool not to send the letters. I will be paying these debts forever otherwise and it has given me more confidence to deal with them by knowing that my offers, although they first seemed low to me, are actually going to be knocking more money off my debts than before! Providing of course that my interest is frozen!
I now just wait for my replies! Arrgh!! Fingers crossed!!!!

Nat0273

Hi there I did the same mid feb , Mbna immediately froze to 0percent and accepted repayment offer although they will default the account in 7 months unless u can agree a min payment that will pay the balance off within 5years, I am waiting a new form to fill out to prove I could do this as really don't want to default

Barclaycard agreed to reduce apr to 6.9percent and accepted my offer of repayment but will inform credit ref agencies and will review it in 11months

Tesco can't understand there reply they want to default me straight away as soon as I don't pay the min repayment I should make so too scared to pay them my offer!

Halifax still not heard from them!

Good luck

Getmeoutofdebt

Thanks nat for your post! Its good to get some info like this from someone who has done the same. It gives me a bit of an idea what to expect and also for other people reading this thread too who are thinking of doing the same. Until I came on here I didn't really know anyone who had done this kind of thing before so its great to share info. I'd always heard that MBNA could be quite hard work so hearing that they froze the interest for you is great! I am glad you are getting some good reactions from your creditors! (apart from Tesco, but If you are doing the same as me through debtline / cashflow, there are other letters to send if you don't get a good response so fingers crossed with a bit more persuasion they may give you the answer that you want)
I haven't heard from anyone yet. I only posted my letters Tuesday so I'm not really expecting a response till maybe next week, though yours have taken a while haven't they if Halifax haven't replied a month later? I'm not even sure if I have sent my letters to the correct addresses. I had such a hard time when phoning them to get details that I ended up just googling for random addresses!
Good luck to you anyway! Hope you manage to get everything sorted and get out of debt without too much hassle.

Nat0273

Me too I'm not sure if I got the right address for Halifax they do take some time to come back I think Mbna was the quickest at around 10days good luck

Getmeoutofdebt

23rd March 2012

Payday! My credit card bills are due to be paid today and I still haven't had any replies from the letters I have sent out. I checked with National Debtline and they said to go ahead and make my new lower payments rather than what the credit cards want me to pay. So that is what I have done. Maybe they will get round to contacting me once they realise I haven't paid the full amount. It has made such a difference to me to pay the new amounts. I actually have enough money left in my bank to cover the food shopping and bills! Yay!! I don't need to borrow any more to get through the month. The downside will probably be that by next payday I will have accumulated a handful of default charges and that my debts have gone up due to interest.
I'm feeling quite positive though at the moment. Just wondering what the next few weeks will bring. Fingers crossed its not too bad!

elantan

well done on your bold move i am sure it will settle soon

Getmeoutofdebt

24th March 2012

My first reply! Yorkshire bank have accepted my lower payment offer and will suspend interest...... BUT....... only for 3 months! Hmm! Wasn't quite what I was expecting really!! I thought I would get a big fat NO or a longer term of frozen interest but maybe with a few conditions thrown in. I'm not really sure what to make of it. Three months?? Do they think I am going to be a whole load better off in three months time? It doesn't make sense. My lower offer is £83 per month as opposed to £125. I owe them £5800. 3 x £83 = £249 paid off before they go back to charging me almost £100 a month in interest. It's hardly going to make a difference and then once my interest kicks in again my debt will just go up due to my minimum payment being less than the interest. Grrr. I'm glad they weren't offhand with me etc but it seems like a pointless offer really. I am going to have to send them a reply and maybe grovel a bit I think!

Memory_Girl

Hi Hon

Just keep making the agreed payment- even after three months you can go back and say "nothing has changed - here is what I can afford, same as before".

Sure they may moan - but you can't get blood from a stone as they say. You are making payment amounts after taking advice so even if they were daft enough to take you to court they wouldn't get any more (so they won't spend money doing that will they?)

What may happen down the line is that they get fed up and pass the debt on to a DCA - in which case all interest should stop being applied anyway, and same rules. "You are being paid what I can afford, here you go"

Whatever you do, don't stop paying, but don't be bullied into paying more that you can truly afford.

If you start getting hassle from creditors on the phone - pop back, because Fermi has some kick !!! letters you can then send them.

But - kettle on and chin up, you are doing all the right things

MG

Getmeoutofdebt

Thanks Memory Girl, I really appreciate your comments and it does make me feel better about it all. I have sent them an nice reply thanking them for their temporary help but explaining that it's not going to help me much in the long run and will they reconsider something a bit more long term, I basically said that I do want to pay my debt but I need their help to do it. Fingers crossed. Like you say, if it goes to a DCA the interest would stop. Hopefully they will see sense if I pester them a bit!
Cheers!

Getmeoutofdebt

26th March 2012

My second creditor to reply is MBNA. Two letters from them today. Both a bit vague. Both are from the "head of collections and recovery" so its obviously to do with me contacting them but they are not giving much away information-wise. One tells me I can't use my card anymore and I must destroy it. The other just says "please find enclosed 3 giro slips as requested". Not that I requested any! Do I just presume they have accepted my offer? Why don't they tell me? I can ring them but only mon to fri 9 to 5, impossible cos thats when I'm at work and even if I get a break its impossible to go somewhere private to ring them.
Grrr! Another one I am going to have to write back to!