Struggling with debt? Ask a debt advisor a question

ktmatey

Hi, I have managed to rack up about £11,500 of debt on credit cards and borrowing from family. I have now done a detailed budget and can afford to pay this debt back at £650 per month.

However, I have a current cash flow issue. I haven't been budgeting and am really behind each month, so have run out of cash, still have some credit card monthly minimums to pay, as well as other household bills before the end of the month.

I don't really want to borrow more, or get behind with payments, but don't know the best approach to getting back on track.

A bit lost. Any help massively appreciated.

johnnyk39

Hi,

I need some help regarding my debt please.

I have 3 credit cards and have about £13,000 debt on them I am trying to pay off. The interest rates have now also started so it is making things hard to pay the balances in full. I will be paying roughly £400 a month for balances but the interest rates are just about half that!

I have recently been turned down for a loan which I was hoping to take to pay them all off over 5 years. I could have got another credit card but they were giving me £500 limit which isn't much help.

My credit rating says 3/5 on noodle. I have never missed any payments before or got behind so far but I think I am starting to struggle a bit and it's getting on top of me more and more.

Last year I sold my house for a bit less than it was worth and I was hoping at the time this would've helped pay off some of the debt I have had over the years but it wasn't to be.

I was thinking of going to a debt consolidation route but I would rather not.

I got in touch with one of the credit card company's and they have said I need to fill out forms if I am having problems paying the balances but they won't lower interest rates for now.

Any help would be great.

Thanks,
John

StepChange_James

ktmatey wrote: »

Hi, I have managed to rack up about £11,500 of debt on credit cards and borrowing from family. I have now done a detailed budget and can afford to pay this debt back at £650 per month.

However, I have a current cash flow issue. I haven't been budgeting and am really behind each month, so have run out of cash, still have some credit card monthly minimums to pay, as well as other household bills before the end of the month.

I don't really want to borrow more, or get behind with payments, but don't know the best approach to getting back on track.

A bit lost. Any help massively appreciated.

Hi there,

It sounds like you'll be able to manage these debts out of the £650 a month you've left in your budget for the longer term, but there is a short term issue for this month due to cash flow.

If this is the case then there are a few possible approaches. You could contact some of the companies you make payments to and request the regular payment dates be pushed back until after you're paid next.

This isn't a long term solution but if changing the dates means the bill skips one of your pay cycles it might be enough to sort things out.

Alternatively you could ask companies you owe money to for a payment break. This is probably a slightly longer shot, but some companies are willing to do this.

If you do end up missing payments on anything you can usually make arrangements to catch up by installments. So rather than paying a double payment the next month to catch up, you could pay your normal payment plus a bit extra to catch up over a few months (the timescale is something you'd negotiate with the company).

If I've got it wrong and you think you might need debt advice to find a long term debt solution then I'd suggest contact us using the details in my signature below.

Kind regards

James

StepChange_James

johnnyk39 wrote: »

Hi,

I need some help regarding my debt please.

I have 3 credit cards and have about £13,000 debt on them I am trying to pay off. The interest rates have now also started so it is making things hard to pay the balances in full. I will be paying roughly £400 a month for balances but the interest rates are just about half that!

I have recently been turned down for a loan which I was hoping to take to pay them all off over 5 years. I could have got another credit card but they were giving me £500 limit which isn't much help.

My credit rating says 3/5 on noodle. I have never missed any payments before or got behind so far but I think I am starting to struggle a bit and it's getting on top of me more and more.

Last year I sold my house for a bit less than it was worth and I was hoping at the time this would've helped pay off some of the debt I have had over the years but it wasn't to be.

I was thinking of going to a debt consolidation route but I would rather not.

I got in touch with one of the credit card company's and they have said I need to fill out forms if I am having problems paying the balances but they won't lower interest rates for now.

Any help would be great.

Thanks,
John

Hi John,

I think it's sensible to wary of debt consolidation. We speak to a lot of people who've made their situation worse by trying to borrow their way out of trouble.

I'd suggest getting some in depth advice about how to sort these out. We have an online tool, called Debt Remedy - http://www.stepchange.org/msehelp - which can help. It takes about 20 minutes to complete and will give you a personal action plan with suggestions on how to move forward.

When your credit card company say they need forms from you they'll be mean the kind of information Debt Remedy collects from you. So the advice booklet you'll receive will contain things you can send on to them which will show them your current situation.

I hope this helps.

James

Gimmesomeluck

Help, please I'm at desperation point. This problem has made me feel suicidal. We got into debt three years ago and because my husband was being chased for money he got an IVA with Premier Solutions Ltd. We were told that we had to pay them a one off pament of £1000 plus Vat. We scrimped and got the money together for this. We quite clearly asked if there would be anything else to pay and they said quite firmly NO. Our debt was £16,331.34 to 5 companies. We have religously paid the agreed £200 a month which now totals £6,800 Now you would think that would be it. No, they have now phoned us and demanded over £16,000 saying that we agreed and signed for the charges that they would add on. We have no paper to say this, nor have we signed anything to aggree to this.
I have been asking them over the phone for the final figures that was agreed to at the creditors meeting at the start of the IVA, each time I was fobbed off with we'll find out and get back to you of which they never did. Please please please what are we to do.
I have just lost my father and now this. I really can't find a reason to carry on.

System

Gimmesomeluck wrote: »

Help, please I'm at desperation point. This problem has made me feel suicidal. We got into debt three years ago and because my husband was being chased for money he got an IVA with Premier Solutions Ltd. We were told that we had to pay them a one off pament of £1000 plus Vat. We scrimped and got the money together for this. We quite clearly asked if there would be anything else to pay and they said quite firmly NO. Our debt was £16,331.34 to 5 companies. We have religously paid the agreed £200 a month which now totals £6,800 Now you would think that would be it. No, they have now phoned us and demanded over £16,000 saying that we agreed and signed for the charges that they would add on. We have no paper to say this, nor have we signed anything to aggree to this.
I have been asking them over the phone for the final figures that was agreed to at the creditors meeting at the start of the IVA, each time I was fobbed off with we'll find out and get back to you of which they never did. Please please please what are we to do.
I have just lost my father and now this. I really can't find a reason to carry on.

Hi and welcome to the forum,

It sounds like you would benefit from some free and impartial advice.

Firstly the majority of IVAs last 5 to 6 years (the legal term). From your post it suggests you have only paid into the IVA for just short of three years. The term of the IVA should have been explained to you at the outset and will be detailed in your IVA proposal.

It’s not clear if your IVA has failed at this point. If it does fail, any remaining debt will be chased by your creditors.
I’d recommend that you speak to the Insolvency Practitioner who is Supervisor of your IVA. They will be the person who signed the original written IVA document with you.

It can sometimes be hard to speak to the IPs themselves rather than a case handler, I’d suggest you ring the company and insist on this.

If you find that the Supervisor isn’t helpful you can use the below link to make a formal complaint.

http://www.bis.gov.uk/insolvency/insolvency-profession/professional%20conduct/how-complain-against-an-ip
While it does sound like you’re on an IVA it is worth checking the Insolvency Register for your details http://www.insolvencydirect.bis.gov.uk/eiir/ We have come across instances where people have been told they’re on an IVA but instead they’re on something similar to a fee charging debt management plan. You say you have no signed paperwork with the company, which is concerning. With no signed paperwork, or legal IVA document, there is no IVA. You can read more about that here - http://moneyaware.co.uk/2011/04/are-you-really-on-an-iva/

All IVAs do have fees attached (although not usually upfront fees anymore). We can help you resolve this situation, but in the first instance you can only speak to the Supervisor of your IVA as they are legally bound to offer professional advice and assistance (this is partly what you have paid the fees for).

If all of this stress is making you feel suicidal I’d recommend that you speak to your GP or give the Samaritans a call http://www.samaritans.org/.

If you need any more help please come back to me.

Kind regards,

Mat

johnnyk39

StepChange_James wrote: »

Hi John,

I think it's sensible to wary of debt consolidation. We speak to a lot of people who've made their situation worse by trying to borrow their way out of trouble.

I'd suggest getting some in depth advice about how to sort these out. We have an online tool, called Debt Remedy - - which can help. It takes about 20 minutes to complete and will give you a personal action plan with suggestions on how to move forward.

When your credit card company say they need forms from you they'll be mean the kind of information Debt Remedy collects from you. So the advice booklet you'll receive will contain things you can send on to them which will show them your current situation.

I hope this helps.

James

Thanks James,

I can hopefully keep up the payments (with interest) for another while yet and look towards the long term rather than the short term to pay this debt off. I have planned that if I can pay the minimum payments, along with interest it would take 4 years to pay off! If I can afford more each month I will try but like lots of people I have lots of other bills to pay and a family to support.

Can I ask how long is best to reapply for new credit cards to pay less interest? One company says try again in a month and another says 6 month. I don't want to keep trying and getting knocked back and I take it this doesn't help my credit score either?

Thanks again for your help.

Cheers,
John

System

johnnyk39 wrote: »

Thanks James,

I can hopefully keep up the payments (with interest) for another while yet and look towards the long term rather than the short term to pay this debt off. I have planned that if I can pay the minimum payments, along with interest it would take 4 years to pay off! If I can afford more each month I will try but like lots of people I have lots of other bills to pay and a family to support.

Can I ask how long is best to reapply for new credit cards to pay less interest? One company says try again in a month and another says 6 month. I don't want to keep trying and getting knocked back and I take it this doesn't help my credit score either?

Thanks again for your help.

Cheers,
John

Hi John and thanks for getting back to us.

The best advice on credit ratings and credit cards with lower interest rates is right here on MoneySavingExpert.

Martin has written a great article about how to repair credit ratings and how they work, it’s worth a read if you’re currently getting turned down for a lower rate card.

http://www.moneysavingexpert.com/loans/credit-rating-credit-score

It also worth signing up to the email for alerts about good lower rate credit card deals and 0% transfers.

I hope this helps.

Kind regards,

Mat

baldwin1976_01

Thanked 0 Times in 0 Posts

In 2008 I was made redundant and incurred alot of defaults and several CCJ's. Most of these are now settled and next year will no longer appear on my file. My question is this, if a default is paid early when will the default mark fall off my file - 6 years from the date of the default or 6 years after the account is closed.??

Secondly What happens to your credit rating if your defaults and CCJ's don't show anymore on your file ? Will it slowly improve if you open new accounts and keep up payments ?

Anyone's advice would be much appreciated as I desperately want to be able to obtain credit again.

Regards

Baldwin1976_01

Former_StepChange_Rachel

baldwin1976_01 wrote: »

Thanked 0 Times in 0 Posts

In 2008 I was made redundant and incurred alot of defaults and several CCJ's. Most of these are now settled and next year will no longer appear on my file. My question is this, if a default is paid early when will the default mark fall off my file - 6 years from the date of the default or 6 years after the account is closed.??

Secondly What happens to your credit rating if your defaults and CCJ's don't show anymore on your file ? Will it slowly improve if you open new accounts and keep up payments ?

Anyone's advice would be much appreciated as I desperately want to be able to obtain credit again.

Regards

Baldwin1976_01

Hi there,

Thank you for posting.

Whatever is on your credit file will remain there for six years from the day it was logged. So with the default you were asking about, it would take six years from the date of the default for it to disappear from your credit file.

if you're making repayments on your debt, your credit file will be improving steadily all the while. It's always good to reassure people when they are worried about their credit file that their situation isn't permanent - as long as you're taking responsibility for your debt, you CAN have a great credit rating again.

Hope this helps

Best wishes

Rachel