Struggling with debt? Ask a debt advisor a question

jdl93

Hi There, ill try to keep it short for you.

Basically being young, ive got into alot of debt which i regret now, and managed to get a much high paying job.

So money situation as it stands right now.

£2400 to lloyds *overdraft*
£450 to Vanquais *Credit card*
£740 to aqua *Credit card*
£1100 to barclaycard *Credit card*
£350 to wonga *payday loan* (Interest Frozen) £135 a month agreement

I want to get a loan next July so i can get a decent car rather than my piece of old rubbish, so i want to improve my credit score before then. am i better off getting wonga paid off and out the way so it doesn't show as recent, even though the interest is frozen, or should i start paying off the cards.

would there be any way of getting the interest frozen on the cards?

Thanks in advice for your help!

carol1963_2

Morning, Sorry to chase but I would appreciate an answer to my question please so I can contact Step Change to let them know my decision.

Many Thanks.

System

carol1963 wrote: »

Morning, Sorry to chase but I would appreciate an answer to my question please so I can contact Step Change to let them know my decision.

Many Thanks.

Hi Carol,

I've answered your question in the private message you sent us.

I hope this helps.

Kind regards,

Mat

System

jdl93 wrote: »

Hi There, ill try to keep it short for you.

Basically being young, ive got into alot of debt which i regret now, and managed to get a much high paying job.

So money situation as it stands right now.

£2400 to lloyds *overdraft*
£450 to Vanquais *Credit card*
£740 to aqua *Credit card*
£1100 to barclaycard *Credit card*
£350 to wonga *payday loan* (Interest Frozen) £135 a month agreement

I want to get a loan next July so i can get a decent car rather than my piece of old rubbish, so i want to improve my credit score before then. am i better off getting wonga paid off and out the way so it doesn't show as recent, even though the interest is frozen, or should i start paying off the cards.

would there be any way of getting the interest frozen on the cards?

Thanks in advice for your help!

Hi and welcome to the forum:)

If you’re thinking of taking out further credit the most important thing is to make sure you can afford it first.

I’d recommend putting together an accurate income and expenditure budget looking at what you can afford with your current debts and any new debts you take on.

Our online debt advice tool Debt Remedy http://www.stepchange.org/debtremedy.aspx?hp=400 can help you with a budget.

It’s also worth looking at your credit file to see if there are any defaults which could restrict your access to credit.

Getting interest frozen on the credit cards is up to the creditors, but doing this would mean that you've broken the terms of the credit agreement. And this could affect your credit rating.

You can learn more about how to improve your credit rating (and how credit ratings work) with this article.

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

I hope this helps.

Kind regards,

Mat

carol1963_2

Thanks Mat, I've seen that but I did ring yesterday and didn't really get a yes/no answer and I'm so indecisive at the moment I just don't know what/where to turn. Yes in my heart I want to defer but I'm scared of any additional 'hassle' that might entail but at least I will have paid my very good neighbours/friends some of there money.

Jog_on

Hi,

Could you please give me some help and advice? Im at my wits end and losing the will to live.

My Father left me his property in his will, he passed away in 2005, and my mother shortly after him. I lived in the said property with my then partner, he couldnt deal with my grief so the relationship ended...this is all irrelevant to you but just to give you some background! The lawyer could only find a copy of the will and not the original will which started a long and painful process of getting the property into my name. In this time, my partner stayed there and i moved out (short term supposed to be) for some breathing space. Needless to say, ive never managed a foot in the door since. My lawyers fees are going to be in the region of 'horrendous',The lawyers have now proven tenor of the will which is great, but in all that time, my ex partner has been renting out the property to a friend of his!!!! When i was at the address, i did have storecards, which i totally forgot all about.....on Monday, i got home to two letters from Robinson Way Ltd asking if i was......that used to reside at..........I havent replied!!! Im terrified to reply. I am currently working part time, but work extra when i can as i need the cash. I have been forced to rent accomodation which is costing a fortune every month, as well as bills...im barely scraping by (some months i dont) Im not in the situation to pay these debts back. What do you suggest i do? I know that after 6 years the debts should be statute barred ( i know this isnt the right attitude to have and im ashamed im even saying it) but should i continue to ignore these letters?

My ex now has the life of Riley, new cars, own business, holidays etc and i cant move forward with my life!

Any help and advice would be greatly appreciated.

Regards
Jog on

uphillstruggler

StepChange_James wrote: »

Hello,

I don't think there really is a set amount that creditors are likely to accept for full and final settlements. As you've seen, some are willing to offer big reductions and others can be tougher to negotiate with.

Debt collectors don't have any more power than HSBC have at the moment, so them passing the debt on wouldn't affect you. Other than you'd just have to deal with the debt collector instead of HSBC, but they can sometimes be a bit more willing to come to arrangements.

I'd recommend trying to get some sort of payments to your debts that aren't cleared. If your budget is in deficit it might be hard to find much but any payment at all will show that you're acknowledging the debt.

I've spoken to people in the past who've had debt collectors start chasing them for the leftover balance of a debt cleared by full and final settlement. If you've got written confirmation of the agreement and proof of sending the money then you should be covered.

That's why it's important to get agreements in writing and keep them somewhere safe afterwards.

Hope this helps.

James

Thanks for this, James. Much appreciated.

highlander05

Hi,

I found out this week that my wife and I are going to become parents -- totally unplanned and a real shock, but something I need to prepare for over the next six months by getting my finances in order. Can you help?

I have supported my wife through Uni, she graduated in July and actually starts her first job tomorrow -- although obviously that won't be the windfall we'd hoped as she'll have to take some time off pretty soon.

While she was at uni we basically lived fairly well on my wage, I earn a decent amount (£45k) and we live in a rural area where property and cost of living is cheap.

When we've needed a holiday or a family member has needed a loan I've always been happy enough to use my credit cards, I did that when buying my new (to me) car last year and when decorating our living room, buying a new tv etc, and I've never worried too much about paying it off as I could always afford the repayments and I figured that when my wife started working we could just double up on all the payments until it was clear.

However, she found work hard to come by when she graduated, and as I say she only starts this week in a part time job.

To top it all off my car (which I need for work) is playing up as well and needs things like new tires etc which I just can't afford.

I currently earn in the region of £45k a year.

I have a credit card debts on three different cards all fairly near their maximums (£7k at 18% £5.2k at 18% and £3k at 22%) and an overdraft of £1k as well.

Each month I pay £250 off each credit card (£750 total), £200 off a loan I had, as well as my £300 mortgage, and some finance on furniture etc we've had.

Although I take home around £2.600 a month, I never seem to have anything left, and by payday I'm having to use the cards to pay for fuel and essential shopping, which in turn means the principal never really goes down by much. Last month I had to cancel my direct debit to my electricity supplier to stop me getting bank charges because I had no money left in my account.

I own a house, valued at £85-90k, which has a £60k mortgage -- do you think my best bet would be to try an consolidate the credit cards onto my mortgage? I'm thinking that even if my mortgage doubled to £600, I'd be so much better off each month, without having all those credit card bills to pay. I know I'd need to cut the cards up/close the accounts so I didn't end up racking up bills again.

I would do that -- although I'm obviously going to need some money over the next few months to do things around the house and get ready for our new arrival. I have had ccjs in the past but now have none (haven't had for about four years) and I don't want to fall into the trap of having them again. It held my life up for three years and prevented me buying a house, so I will never allow myself to have them again if I can possibly avoid it. I have no late payments on my accounts either.

I'm really excited, we both are, but I feel under so much pressure because I don't know how I'm going to stay on top of it all without falling behind on one or more of the cards.

Former_StepChange_Rachel

Jog_on wrote: »

Hi,

Could you please give me some help and advice? Im at my wits end and losing the will to live.

My Father left me his property in his will, he passed away in 2005, and my mother shortly after him. I lived in the said property with my then partner, he couldnt deal with my grief so the relationship ended...this is all irrelevant to you but just to give you some background! The lawyer could only find a copy of the will and not the original will which started a long and painful process of getting the property into my name. In this time, my partner stayed there and i moved out (short term supposed to be) for some breathing space. Needless to say, ive never managed a foot in the door since. My lawyers fees are going to be in the region of 'horrendous',The lawyers have now proven tenor of the will which is great, but in all that time, my ex partner has been renting out the property to a friend of his!!!! When i was at the address, i did have storecards, which i totally forgot all about.....on Monday, i got home to two letters from Robinson Way Ltd asking if i was......that used to reside at..........I havent replied!!! Im terrified to reply. I am currently working part time, but work extra when i can as i need the cash. I have been forced to rent accomodation which is costing a fortune every month, as well as bills...im barely scraping by (some months i dont) Im not in the situation to pay these debts back. What do you suggest i do? I know that after 6 years the debts should be statute barred ( i know this isnt the right attitude to have and im ashamed im even saying it) but should i continue to ignore these letters?

My ex now has the life of Riley, new cars, own business, holidays etc and i cant move forward with my life!

Any help and advice would be greatly appreciated.

Regards
Jog on

Hi there Jog on,

Thank you for getting in touch and I’m very sorry to hear what you’ve had to deal with since your father passed away.

As we primarily give debt advice, we wouldn’t be able to give you all the help you need in regards to your ex-partner being in the house your father left you. I recommend you seek independent and free legal advice either from your local Citizens Advice Bureau (you can find your nearest one here: http://www.citizensadvice.org.uk/) or get in touch with Shelter who often advise on housing issues such as this: http://www.shelter.org.uk/

When it comes to the storecards you mentioned, it’s understandable that you may have lost track with what you owed on them with everything that’s happened. That said, ignoring the debt for 6 years does not mean that the Limitation Act will apply. The Limitation Act is the official name for what protects you once a creditor fails to establish a payment with you within a 6 year period. If they then try and initiate a payment arrangement after the 6 year period is up, the debt becomes unenforceable.

This usually doesn’t apply however if the creditor didn't have updated details to contact you or if they take the debt to county court in your absence. Please don’t be ashamed for wondering if the Limitation Act applies to you. It’s only human that it would cross your mind and we all wish our problems would disappear by themselves from time to time. The important thing is that you are dealing with the problem by seeking advice.

You don’t have to deal with this alone, and we help thousands of people every week deal with difficult situations just like this. I highly recommend you get in touch with us and look at things in more detail. We have an anonymous advice tool called Debt Remedy that can provide a debt solution in just 20 minutes: http://www.stepchange.org/debtremedy.aspx?domain=www.MoneyAware.co.uk


I do feel however that due to the complicated nature of your situation, it would be better for you to have a chat with one of our friendly advisors. You can contact them here: http://www.stepchange.org/Contactus.aspx

Hope this helps,

Best regards

Rachel

Former_StepChange_Rachel

highlander05 wrote: »

Hi,

I found out this week that my wife and I are going to become parents -- totally unplanned and a real shock, but something I need to prepare for over the next six months by getting my finances in order. Can you help?

I have supported my wife through Uni, she graduated in July and actually starts her first job tomorrow -- although obviously that won't be the windfall we'd hoped as she'll have to take some time off pretty soon.

While she was at uni we basically lived fairly well on my wage, I earn a decent amount (£45k) and we live in a rural area where property and cost of living is cheap.

When we've needed a holiday or a family member has needed a loan I've always been happy enough to use my credit cards, I did that when buying my new (to me) car last year and when decorating our living room, buying a new tv etc, and I've never worried too much about paying it off as I could always afford the repayments and I figured that when my wife started working we could just double up on all the payments until it was clear.

However, she found work hard to come by when she graduated, and as I say she only starts this week in a part time job.

To top it all off my car (which I need for work) is playing up as well and needs things like new tires etc which I just can't afford.

I currently earn in the region of £45k a year.

I have a credit card debts on three different cards all fairly near their maximums (£7k at 18% £5.2k at 18% and £3k at 22%) and an overdraft of £1k as well.

Each month I pay £250 off each credit card (£750 total), £200 off a loan I had, as well as my £300 mortgage, and some finance on furniture etc we've had.

Although I take home around £2.600 a month, I never seem to have anything left, and by payday I'm having to use the cards to pay for fuel and essential shopping, which in turn means the principal never really goes down by much. Last month I had to cancel my direct debit to my electricity supplier to stop me getting bank charges because I had no money left in my account.

I own a house, valued at £85-90k, which has a £60k mortgage -- do you think my best bet would be to try an consolidate the credit cards onto my mortgage? I'm thinking that even if my mortgage doubled to £600, I'd be so much better off each month, without having all those credit card bills to pay. I know I'd need to cut the cards up/close the accounts so I didn't end up racking up bills again.

I would do that -- although I'm obviously going to need some money over the next few months to do things around the house and get ready for our new arrival. I have had ccjs in the past but now have none (haven't had for about four years) and I don't want to fall into the trap of having them again. It held my life up for three years and prevented me buying a house, so I will never allow myself to have them again if I can possibly avoid it. I have no late payments on my accounts either.

I'm really excited, we both are, but I feel under so much pressure because I don't know how I'm going to stay on top of it all without falling behind on one or more of the cards.

Hi there,

Thank you for posting and congratulations on your happy news!

From what you’ve mentioned, it sounds like you would benefit from some free and impartial debt advice.

The credit cards, overdraft and unsecured loan you mentioned are what we call non-priority debts. This means that when you take your whole budget into account, they will also come secondary to living costs such as your mortgage, council tax, car expenses, food and the baby supplies you will very soon need to start budgeting for.

We don’t usually recommend getting further credit out by means of a consolidation as it doesn’t always fix the problem in the long run. We would also advise you to steer clear of taking out a secured loan to get rid of this debt. Once a debt becomes secured on your house you must pay it on time in full every month. You have a lot more flexibility when your debts are unsecured. Our blogpost on consolidation loans goes into further detail on this: http://moneyaware.co.uk/2013/01/to-debt-consolidate-or-not-to-debt-consolidate/

I can understand your reservations when it comes to your credit file. Living on the credit cards cannot carry on indefinitely however, and will only cause you more anxiety in the long run. You as new parents will need to focus your energy on this new chapter in your life, and it’s best that you consider all your options as soon as possible.

It's also important to remember that having a decent wage doesn't automatically mean a person is free from debt problems, so please don't beat yourself up over this. We help people no matter what their circumstances.

I recommend that you take a deeper look at everything you’re spending out on and get some long term debt advice from us. We are a free and independent debt advice charity. Our anonymous advice tool Debt Remedy can give you a debt solution in just 20 minutes: http://www.stepchange.org/debtremedy.aspx?domain=www.MoneyAware.co.uk

Hope this helps

Best regards

Rachel