£78,000 Credit Card DEbt

Sensible77

I’ve finally decided to try to bring to a halt my ridiculous level of debt. I owe £78,000, (that’s right, seventy eight thousand pounds), on credit cards and my outgoings are £2,000 a month more than my income. I’ve been living off my credit cards but, of course, this has almost dried up and I’m beginning to realise the seriousness of the situation. I have told my wife, who was totally in the dark about it, and after a few tough days, she has been very good about it. I have nothing to show for the money as I have been unable to pay my way properly for over 15 years, ( lost money on sale of house, raised deposit on next house with credit cards), but relied on a good salary and credit rating to obtain credit. I have contacted CCCS and Pay Plan who have said that as I have no disposable income that I must appeal to the CC companies. At the moment I am not behind with any payments to the cards or any other lender, (mortgage and house secured loan through Ocean Finance). I am quite frightened about approaching the CC companies and wonder how anyone else in this situation has fared. I am going to cancel Sky TV and my pension payment which will save £200 a month. I have an unsecured loan with HSBC of £257 a month which is due off in September 2007. Three of my credit cards are with HSBC as is my current account and I am afraid that they will take all my salary as soon as I get paid after I tell them. I have looked at remortgaging but have been declined due to the amount of CC debt. I could borrow more money against our house with Ocean Finance but am very reluctant to take on more debt. I have been paid today and could probably just get through the next month. Any advice will be greatly appreciated. Thank you

slowlyfading

Welcome to the site You need to post a SOA (Statement of Affairs, see SouthernScousers sticky at the top of the page) so we can assess more
Nicola x

CLAPTON

your first step is to open a new bank account immediately and ensure all your income is paid into it and the essential bills come out (mortgage, secured debt, utilities, council tax). Obviously the new bank must be an institution you owe nothing to.

next is to post a SOA here so we can see the fincancial details. Also can you add what the house is worth and the mortgage and brief details fo the family situtaion OH, Children.

OberonSH

First of all, you need to pop up a Statemtn of Affairs, so we can see if we can all help you get that overspend down. Above all, keep calm. You've been really brave admitting this, and the fact that your missus is supportive, as this will affect the whole family.

So write down everything in and going out, with the help of the posts rght at the top of the forum. That will make any cash leakages obvious. Naturally, you need to stop using the credit cards!!

My action plan for 'lightbulb day' is fairly simple, and once you have your head round things, I find it useful to action it whilst you're still geared up.

1) Ebay/Amazon & carboot anything not nailed down. This will bring in some cash and stop you spending ont he cards for the basics.

2) reclaim your bank charges. Most people don;t realise how much they can claim back, and usualy takes a nice chunk off the top.

3) set yourself a REALISTIC budget to make sure you're focussed. Then work out what you can afford to repay. Might be worth getting in touch with one fo tehdebt charities to help with this. CCCS etc won;t charge you, and will give you advice on how to handle your creditors.

I hope these little things help, I'm sure everyone else will be along shortly to offer advice also. Don;t foget, you'll never see that £78k figure again, as of today it starts going down, and down, and down....

warburtonrichard

Sensible -
I signed up to Alliance & Leicester through the quidco.com website and got £50.00 cashback. The A&L account took 2 weeks and it was open, which would give you plenty of time to arrange DDs and salary to go into the new account. All the above comments are the best advice, but this might be a helpful one too. The decision takes less than 24 hours to come through too, so you wil know soon that you're going to have your parachute account open.
All of that conditional of course on not owing them any money.
Warby
x

immoral_angeluk

Well done for taking the first step and admitting this can't go on anymore. Like the others have said if you post up a SOA we'll be able to help you with what options you have and suggest ways to help.

Sensible77

Thanks for all your responses. Below is our SOA. We no longer have dependant children. I have a car through a scheme at my work at £260 per month taken direct from my salary which expires next March.

Monthly incomings:
My salary £1200
Partner’s salary £700

Total £1900

Total Outgoings:

Mortgage incl. building
& contents insurance £400
Council Tax £84
Secured Loan
Ocean Finance 12.5% £325

Telephone £38
Sky £44
Water Rates £20
Gas £42
Electricity £38
TV Licence £12
Life Assurance £24
TV Rental £27
Food £250
Petrol £100
HSBC Loan 9.9% £257

Barclaycard Visa £4970 £5000 limit 24%
Barclaycard MasterCard £3100 £3250 limit 24%
Capital One MasterCard £820 £1000 limit 24%
Capital One Visa £3480 £3600 limit 24%
Citi Card £6520 £7500 limit 22%
Egg Card £7400 £7500 limit 17%
Halifax One £2500 £2600 limit 20%
HSBC MasterCard £7140 £7350 limit 20%
HSBC Online Credit Card £9020 £9100 limit 20%
Marbles £9300 £9800 limit 18%
MBNA £9540 £10000 limit 21%
Mint £8800 £9000 limit 17%
Monument £4830 £5000 limit 21%

Wonky

Hi,

This is my first ever post on the site but below are some suggestions ... other more knowledgeable people will be along in time!

Hope it helps.

Sensible77 wrote: »

Thanks for all your responses. Below is our SOA. We no longer have dependant children. I have a car through a scheme at my work at £260 per month taken direct from my salary which expires next March. WOULD IT BE POSSIBLE TO CHANGE THE CAR YOU HAVE IN THE SCHEME TO REDUCE YOUR MONHTLY PAYMENTS? OR GET RID OF THE CAR ALTOGETHER? THIS IS A LOT OF MONEY PER MONTH EXCLUDING PETROL

Monthly incomings:
My salary £1200
Partner’s salary £700

Total £1900

Total Outgoings:

Mortgage incl. building
& contents insurance £400 CAN YOU GO INTEREST ONLY FOR A WHILE TO FREE UP SOME CASH TO THROW AT YOUR CC DEBTS?
Council Tax £84
Secured Loan
Ocean Finance 12.5% £325

Telephone £38 ARE YOU ON THE BEST PACKAGE - ANY PACKAGES AROUND OFFERING FREE WEEKEND/EVENING CALLS YOU CAN CHANGE TOO?
Sky £44 CANCEL THIS AND GET A FREEVIEW BOX IF YOU WANT ADDITIONAL CHANNELS
Water Rates £20 COULD YOU MAKE SAVINGS BY CHANGING TO A WATER METER?
Gas £42 SEEMS HIGH FOR ONLY TWO PEOPLE - SEE IF YOU CAN SWITCH PROVIDER
Electricity £38SEE ABOVE
TV Licence £12
Life Assurance £24
TV Rental £27 CAN YOU STOP THIS AND GET A CHEAP TV, OR GET ONE FROM WWW.FREECYCLE.CO.UK?
Food £250 AGAIN A LITTLE HIGH FOR TWO PEOPLE, COULD YOU CUT BACK HERE SOMEHOW?
Petrol £100
HSBC Loan 9.9% £257

Barclaycard Visa £4970 £5000 limit 24%
Barclaycard MasterCard £3100 £3250 limit 24%
Capital One MasterCard £820 £1000 limit 24%
Capital One Visa £3480 £3600 limit 24%
Citi Card £6520 £7500 limit 22%
Egg Card £7400 £7500 limit 17%
Halifax One £2500 £2600 limit 20%
HSBC MasterCard £7140 £7350 limit 20%
HSBC Online Credit Card £9020 £9100 limit 20%
Marbles £9300 £9800 limit 18%
MBNA £9540 £10000 limit 21%
Mint £8800 £9000 limit 17%
Monument £4830 £5000 limit 21%

joeblack066

Hi There!! As far as I can see the outgoings that you have listed total £1661. I can't see anything for car repairs, tax and MOT, but I feel that your food bill is very high for 2 people, and therefore you could easily trim this down to about £150 and allow £100 for car etc. If you also lose the Sky TV, that saves another £44 and if the TV rental is out of the contractual period can you not cancel this aswell? Therefore you should have £283 pcm to throw at your CC's. Then you need to put them into a 'Snowballer' which will show you how to split the payments between each company, and this will give you the figure to offer each one. Here's the link; http://us.whatsthecost.com/snowball.aspx
Welcome and good luck! You CAN do this and you will feel so much better now that you have taken your first steps!

purplelaurel

Hi There

Firstly you are not alone, our situation about the same we owe £85k of unsecured debt and like you have survived on credit cards in the same way for many years. Before Christmas we were in a terrible state and didn't know what to do, this site is great you will get lots of suport and advice, but I would also suggest you contact National Debtline who are great, you can talk through everything with them and they will advise what plan of action is needed, and there will be options. We were advised to firstly set up new safe bank account as someone has already mentioned, then to cancel all our direct debits of 'non priority' or unsecured debts and then write to them all asking them to hold action, if you look on National Debtline website there is a brilliant self help pack but even better share your worry and give them a call. You need to be patient as takes a while to get through but ringing this time of night is best as not so busy.

Good luck and hope all works out for you.

lynzpower

Hi there, here are my thoughts!

Mortgage incl. building
& contents insurance £400 ( can you get your B&C cheaper without being tied to the mortgage)
Council Tax £84
Secured Loan
Ocean Finance 12.5% £325

Telephone £38 ( whats this, sounds like a package, get landline only and get primus 2 ( free evening & weekend calls for free, you get 15 cash back through quidco for this)
Sky £44 ( dump, as you said you would:)
Water Rates £20
Gas £42 ( https://www.est.org.uk, check you are not wasting ANY gas, turn your thermo down, insulate your loft, extra jumpers!)
Electricity £38 ( as above!)
TV Licence £12
Life Assurance £24 ( check this is the cheapest if not swtich)
TV Rental £27 ( dont rent a tv! ask for one off freecycle.org, or get a cheapie 2nd hand one off ebay, they tend to go for a fiver save yourself a fortune!)
Food £250 ( you can slice this down to 100 with some VERY careful planning, using money off vouchers, using up what youve got in and a bit of grow your own! its not as hard as youd think!!)
Petrol £100 ( get it from tescos or sainsburys and get clubcard points towards shopping)
HSBC Loan 9.9% £257

Barclaycard Visa £4970 £5000 limit 24%
Barclaycard MasterCard £3100 £3250 limit 24%
Capital One MasterCard £820 £1000 limit 24%
Capital One Visa £3480 £3600 limit 24%
Citi Card £6520 £7500 limit 22%
Egg Card £7400 £7500 limit 17%
Halifax One £2500 £2600 limit 20%
HSBC MasterCard £7140 £7350 limit 20%
HSBC Online Credit Card £9020 £9100 limit 20%
Marbles £9300 £9800 limit 18%
MBNA £9540 £10000 limit 21%
Mint £8800 £9000 limit 17%
Monument £4830 £5000 limit 21%

Now if your credit rating is good, and you havent missed any payments, I suggest you try to get as much of this debt onto 0% or low life of balance as you can

Cut the cards up and do not use them - never.

Sell anything you can and throw the proceeds at your most expensive debt

Can you take on any part time work, say on the weekend? Do you have any specific skills, can you freelance? What about your wife, does she work full time for 700? seems quite low?

All the best, youve a mountain to climb but it can be done with some willing
lynz
xx