Help. What's my best option? (My SOA)

JJ7001

Hi all,

Please find below my SOA. I've run up debt through foolish immature spending through university and beyond. I've got to the point where I can't make the minimum payments any longer. I'm currently a private tenant in my mid 20s. The CCCS site suggests I should go for a Debt Repayment Plan but I'm worried that I'll be unable to rent again or get a mortgage (when I clear the debt).

I would really appreciate your advise...thanks

Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Monthly income after tax................ 1640
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1640

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 83.5
Rent.................................... 500
Management charge (leasehold property).. 0
Council tax............................. 50
Electricity............................. 15
Gas..................................... 15
Oil..................................... 0
Water rates............................. 15
Telephone (land line)................... 0
Mobile phone............................ 50
TV Licence.............................. 6
Satellite/Cable TV...................... 0
Internet Services....................... 15
Groceries etc. ......................... 80
Clothing................................ 25
Petrol/diesel........................... 50
Road tax................................ 0
Car Insurance........................... 50
Car maintenance (including MOT)......... 12
Car parking............................. 0
Other travel............................ 10
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................................ 10
Entertainment........................... 20
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1026.5


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


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 0........(0)........0
Hire Purchase (HP) debt ...... 2000.....(83.5).....0
Total secured & HP debts...... 2000......-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Halifax CC.....................1200......32........12.9
Halifax Overdraft..............1200......50........0
MBNA CC........................3394......135.......29.9
Amex CC........................2600......75........19.9
Personal Loan..................7500......163.......8.9
Nationwide Overdraft...........1400......0.........18.9
Nationwide CC..................8000......195.......15.9
Total unsecured debts..........25294.....650.......-


Monthly Budget Summary
Total monthly income.................... 1,640
Expenses (including HP & secured debts). 1,026.5
Available for debt repayments........... 613.5
Monthly UNsecured debt repayments....... 650
Amount short for making debt repayments. -36.5

Personal Balance Sheet Summary
Total assets (things you own)........... 0
Total HP & Secured debt................. -2,000
Total Unsecured debt.................... -25,294
Net Assets.............................. -27,294


My current situation is I'm maxed out on my overdrafts and have no money to meet any repayments this month. I also have a £400 payday loan to pay end of June....I know I'm an idiot and totally to blame for this but I really need to get it sorted.

Hopelessly_Hopeful

My advice is pay the payday loan off this month, send tokens of a pound to the others and start a DMP the month after.

Your credit score will be trashed for 6 years from defaults but chances are is probably is anyway. It is all recoverable, will just take time.

DMP should give you breathing space in your budget too.

HHx

mildredalien

You will still be able to rent with adverse debts, they generally only look for things like bankruptcy rather than whether you are on a DMP. Mortgage will probably be trickier until any defaults come off your file (if you enter a DMP it will mean defaulting on your debts in order to pay what you can afford rather than the minimum amounts).

It looks like your SOA is pretty bare bones as it is, however rent is pretty high. Any way you could reduce it by house sharing or getting a flatmate/lodger etc? The only other places it seems you could cut down is clothing (sell what you don't wear and use ebay/charity shops etc.) and your mobile phone bill.

consultant31

I hate to kick you when you're down but a tv licence is nearer £12 a month

jobdone1

morning your hire purchase is this for a car of something else

JJ7001

Thanks for the reply. I live in a house share hence the reason for the reduced tv license. Unfortunately there's nothing I can do about the rent. My HP is for a car.

cpjackso

Any chance of overtime at work?

Ebay/car boot sale for unwanted items.

Any credit left on the lower APR cards (ie. to transfer high APR debt to lower APR debt?) - or any 0% balance transfer offers?

Would it be possible to catch the bus/walk/bike and get rid of the car and car related expenses?

Mobile bill is expensive - have you tried ringing the provider to switch to a lower tariff?

Gas+Elec seem low - is this just your part of the bill?

Anyway to move to a cheaper rent property to reduce the bill?

If you cut out clothes and entertainment you should be just about able to service your debts... but its the pay day loan that is going to cripple you. I'd probably be tempted to ask if parents/partner/best mate etc could lend me the £400 and pay back over 6 months etc.

Have you missed any payments yet on your debts...? Getting defaults is going to ruin your finance for 6 years - so if there is anyway of scraping together the cash to pay these debts down it might be worthwhile... Always pay off the highest APR first.

If you dont have anything to sell on ebay etc then the main thing to confront is how you have accrued this debt - £25k is a lot of debt... You need to set a plan that will stop you from making the same mistake in future and racking up even more debt.

mildred1978

Do you really need a car if you're only spending £50 a month on fuel? It's costing you at least £180 a month to do what - 50 miles a week? A bike/bus/taxi would probably work out cheaper.

billinghamfan

Hi

Can I please point out to people when they comment on rent, depending on where someone lives it is not always possible to reduce rent! Where I live £750 is about average for a shared house.

JJ7001 - I'm 31 (32 next week!!) my credit rating is trashed I'm in a DMP and feel alot better! Your credit rating will be trashed for 6 years if you go into a DMP but realistily with your current debts and current house places will you have a desposit to be able to get a mortgage in the next 6 years? If you face it now and sort it out you will be out of it alot sooner.

If you can pay off your payday loan I would and then go into a DMP for all your other debts especially if your payday loan is with a toothfairy company!

Best of luck!!

JJ7001

Thanks again for all your support.

No overtime at work unfortunately either wise I would oust definitely be taking it. I dorive around 150 miles a week for £50 and its not possible to get to my workplace on public transport.

I've missed around 4/5 payments over the last year. Hopefully that hasn't damaged my rating too bad. cpjackso, I think I may take your advise and try a friend. I think I know someone who will be able to lend me around £1000. I can try her and if she approves then I guess I can make the immediate payments and just try cutting as much as possible to manage the debt.

Barbeduk

The missed payments will be noted on your credit file. You have such a tight budget at the moment, the problem is, what do you do if something unexpected crops up? Think really carefully about how you take it from here. The dmp will give you breathing space and as someone has already pointed out, would you be in any position to save a deposit for a mortgage in the next few years anyway?

£25k is a heck of a lot. Can you sell any of the stuff you bought?