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Struggling with debt? Ask a debt advisor a question

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  • System
    System Posts: 178,117 Community Admin
    Photogenic Name Dropper First Post
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    Firstly i am on an ipod so bad gramma. I am in big trouble. I have so many debts including payday loans i cant pay back my hubby has left me i am a nurse and cant wirk as my car has broken down noone to help me. I have no mortgage but noone will lend me money to consoladte . What can i di i have less than a quid and cant get to work

    Hi and welcome to the forum.

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


    Consolidating debts often makes the situation worse as you are borrowing more money repayable over a longer period.

    We will be able to assist you with this and the first thing to do is put together an accurate budget.


    You can find help by visiting our online debt advice service Debt Remedy (
    http://www.stepchange.org/msehelp) to help you find a solution to your debt problem quickly.

    Debt Remedy will assist you in completing a financial statement with information on your household, employment, income, expenditure and debts. From this the service will automatically determine your options.


    To help you fill in the form, it’s best to gather together information about
    :
    • Your income

    • Your expenditure

    • The creditors you owe money to


    You’ll receive a downloadable advice booklet providing a tailored solution for you based on your current circumstances and advice on ways you may be able to improve your situation.


    If you’re not confident with computers or would like to speak to an advisor then you’re welcome to ring our free Helpline on 0800 138 1111. We’re open Monday to Friday 8am - 8pm and Saturday 9am until 3.00pm.


    If you phone us it may be possible to refer you directly to a counsellor for immediate advice. Alternatively, we will arrange for an appointment to be booked at a time convenient for you.


    I hope this helps.


    Kind regards,


    Mat
  • Urbanina
    Options
    Hi there,

    I don't know if you can help me, I hope so!
    Background to my situation: I moved abroad last year with the ultimate aim of paying off some small-ish debts and starting to save. Unfortunately the plan didn't work as quickly as I hoped and in the short term I have actually ended up further in the red.

    My circumstances are about to change as I have just accepted a well-paid job that will mean I will now have spare money each month that I can use to pay off my debts more quickly.

    I have a rental flat in the UK. My mortgage payment is £785 but the rental income is only £450 - not ideal, but better than nothing. I have been meeting the payments so my mortgage is totally on track.

    Aside from mortgage, my other debts are:
    £1,750 in an overdraft
    £3,500 on a barclaycard
    £1,000 on a santander credit card

    Here is the issue that I need advice on: I have a new tenant moving in who will pay 12 months rent up front in a lump sum. My instinct is telling me to put this in a savings account and not touch it (apart from to deduct the monthly £450 towards the mortgage) in case the tenant wants to move out for any reason and I have to refund the unused rent.

    However, I would save myself a lot of interest if I used it all to pay off some of my debt (almost all of it in fact), immediately. Then if the tenant moved out I'd have to refund them using a credit card.

    Is it appropriate to use this lump-sum money like that? Is there a danger my credit card limit could get reduced thus leaving me unable to repay the tenant? My current allowances are £6,000 and £3,000 across the two cards. It's unlikely they'll move out, but I have to plan for every possibility.

    Please let me know how you think I should manage this!
    Thanks
  • Cenedra41
    Cenedra41 Posts: 6 Forumite
    edited 12 November 2012 at 3:58PM
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    Hello

    I'm desperately in need of some advice. My husband and I have a consolidation loan we took out 2 years ago for £16000 (still has 3 years to run at £331 per month) but since then we have also built up debts of £30000 more or less on three other credit cards. We are paying £200 per month approximately on each credit card so all in all our debts are costing us around £1000 per month. Up to this month our mortgage cost us £1200 per month as we bought at the height of the boom and thought fixing it would be a good idea! From this month it has gone down to £800 which helps but I am 9 weeks pregnant with twins, bad timing I know but I am 44 so this was last chance saloon as far as having kids goes. I intend to return to work but I am desperately stressed and worried about how we will manage these debts. I'm not a high earner so have to balance how many days I return to work against cost of childcare. I only get 6 weeks full(ish) pay then down to £130 per week statutory maternity pay which isn't nearly enough to manage on.

    At the moment we struggle with minimum payments and run out of money mid month which means I have to put basics such as shopping on to cards which is just adding to the debt. I want to funnel the savings from my mortgage payments into paying things off but have a limited amount of time now until I go on maternity leave next year. I want to deal with this issue now and do something but don't know where to start.

    We considered borrowing extra on the mortgage but a. I don't think they'd lend money to us to consolidate debts and b. we don't have a great deal of equity in the mortgage anyway.

    I considered another consolidation loan but it would need to be very long and low interest for us to manage the payments until I am able to work more hours.

    My husband earns a good salary and is doing his best to do what overtime he can get but it's never enough. Another thing is that on 2 of the cards we have 0% deals until next year which are then due to finish and will go up again.

    I know we have brought this on ourselves but we need to sort this out so it doesn't add to pregnancy stress and gives us a clear idea of the steps we can take

    any help will be so appreciated thanks

    Tina

    sorry one more thing I forgot to add - my husband works for a financial company and due to the nature of the job he holds cannot be a bankrupt or have IVA's etc
  • System
    System Posts: 178,117 Community Admin
    Photogenic Name Dropper First Post
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    Urbanina wrote: »
    Hi there,

    I don't know if you can help me, I hope so!
    Background to my situation: I moved abroad last year with the ultimate aim of paying off some small-ish debts and starting to save. Unfortunately the plan didn't work as quickly as I hoped and in the short term I have actually ended up further in the red.

    My circumstances are about to change as I have just accepted a well-paid job that will mean I will now have spare money each month that I can use to pay off my debts more quickly.

    I have a rental flat in the UK. My mortgage payment is £785 but the rental income is only £450 - not ideal, but better than nothing. I have been meeting the payments so my mortgage is totally on track.

    Aside from mortgage, my other debts are:
    £1,750 in an overdraft
    £3,500 on a barclaycard
    £1,000 on a santander credit card

    Here is the issue that I need advice on: I have a new tenant moving in who will pay 12 months rent up front in a lump sum. My instinct is telling me to put this in a savings account and not touch it (apart from to deduct the monthly £450 towards the mortgage) in case the tenant wants to move out for any reason and I have to refund the unused rent.

    However, I would save myself a lot of interest if I used it all to pay off some of my debt (almost all of it in fact), immediately. Then if the tenant moved out I'd have to refund them using a credit card.

    Is it appropriate to use this lump-sum money like that? Is there a danger my credit card limit could get reduced thus leaving me unable to repay the tenant? My current allowances are £6,000 and £3,000 across the two cards. It's unlikely they'll move out, but I have to plan for every possibility.

    Please let me know how you think I should manage this!
    Thanks

    Hi and welcome to the forum.

    I think where we could help is putting together an accurate budget and looking at what you can afford towards repaying the debts now that you’ve got a new job.


    I’d recommend that you gather details of your income and expenditure give us a call to discuss the situation.


    If you live outside of the UK, and are contacting us regarding UK debts you can contact us on +44 113 297 0126 to book an appointment with an advisor. Lines are open Monday to Friday 08:00-20:00 and Saturday 09.00 to 15.00. It would be helpful that when you call you have details ready regarding your income, expenditure and creditors, as this can help speed up the referral process. If you have this information ready it may be possible to refer you directly to an advisor if one is available, otherwise we will arrange a time that is convenient for you to be called back for an appointment.


    I hope this helps.


    Kind regards,


    Mat
  • Decked
    Decked Posts: 48 Forumite
    First Post First Anniversary Combo Breaker
    Options
    Mainly on credit cards. Spoken to various people, seems like a DMP is the way to go, had lots of advice and slowly working way through budget plan etc.
    A couple of questions, I have £5k overdraft with my bank and also £12k on credit card with same bank. If I set up safe account and stop paying my salary in to my current bank, can they take any action?
    I am 100% up to date on all payments and always have been for the last 20 years. It's got silly though and I am paying over £900 a month in interest.
    I am hoping that the credit card companies would take this into account, would I do any harm in approaching them personally and asking for interest to be frozen and payments reduced with a review of payments in say 12 months time. Also should I start with a phone call or go straight in with a letter?
    Thanks
  • Former_StepChange_Rachel
    Former_StepChange_Rachel Posts: 252 Organisation Representative
    Options
    Decked wrote: »
    Mainly on credit cards. Spoken to various people, seems like a DMP is the way to go, had lots of advice and slowly working way through budget plan etc.
    A couple of questions, I have £5k overdraft with my bank and also £12k on credit card with same bank. If I set up safe account and stop paying my salary in to my current bank, can they take any action?
    I am 100% up to date on all payments and always have been for the last 20 years. It's got silly though and I am paying over £900 a month in interest.
    I am hoping that the credit card companies would take this into account, would I do any harm in approaching them personally and asking for interest to be frozen and payments reduced with a review of payments in say 12 months time. Also should I start with a phone call or go straight in with a letter?
    Thanks


    Hi there Decked :)

    Thank you for posting and welcome to the MoneySavingExpert forum.

    If you owe your current bank an unsecured debt, they do have the right to continue taking money out of your bank account. This is called the Right of Offset. This means that they can take a payment regardless of the other bills and expenses you may have such as rent, council tax, food etc. They can do it without warning but most banks will let you know in advance before they exercise this right they have.

    The best way to prevent having your money seized by the bank is to get a brand new bank account with a bank you owe no money to. Your current bank will not be able to exercise their Right of offset once you do, so long as your new bank is not connected to them. I’ll give you an example:

    Say you bank with Lloyds and have debt with them. You get a basic bank account with Santander and move everything away - Lloyds cannot contact Santander and demand payment. They can only extract money from the account by means of a direct debit or standing order that you authorise.

    But, if you move to Halifax, Lloyds have merged with them and can offset your new account - what a waste of your time!

    So, my advice is always to check with your new bank that they are definitely NOT connected to anyone you owe money to. please be aware that the bank you owe money to can pass the debts on to a collection agency, but don't worry, this is normal and something we can help you deal with.

    You are within your rights to approach your creditors directly and try to negotiate lower payments, but keep in mind that when you act on your own behalf, chances are a lot of your creditors will refuse your offer outright. They will want to ensure that they're treated as fairly as your other creditors.

    The best way to make reduced payments on multiple debts that's fair and realistic for everyone is going on a fee-free, impartial Debt Management Plan such as what we may be able to offer you.

    In case you're not familiar with us, we a free and confidential debt advice charity. There's a lot of fee-charging DMP companies out there but our plans have no fee included, so you have peace of mind that your payment is going towards your debts and not in our pockets.

    I recommend you try Debt Remedy, our online debt advice tool that can give you your best debt solution in just 20 minutes. The link will be in my signature.

    If you'd prefer to speak to someone, just call our Helpline (free from landlines and mobiles) and talk to one of our advisors.

    Our number is 0800 138 1111. We're open 8:00am to 8:00pm Monday to Friday, and 9:00a.m. and 3:00p.m. on Saturday.


    Best wishes,

    Rachel
    I work as a debt advisor for StepChange Debt Charity (formerly CCCS) and have specific permission from Martin to post on these boards to try and help those in debt. Read more information on StepChange Debt Charity in the Debt Problems: What to do and where to get help article. If you find you're struggling with debt and you need further help try our online advice facility Debt Remedy

    If money worries are keeping you awake, read Paul's success story at [url="http://www.needtosleep.org]Need to Sleep[/url]

  • wnjmurphy
    Options
    Hello,

    I have just requested my DMP that (as per the email) should arrive tomorrow.

    If I get everything back via e-mail tomorrow, when will things be set up? Reason I ask is I have a pay day loan (DOH!) to go out at the end of the month. If they take the money, it leaves me requiring probably another to pay the rent etc.

    If I contact them direct, do they stop the taking of the payment, or will they still attempt it on that date, if so, how quickly can StepChange act to make sure they don't.

    Many thanks for your help and your fantastic service.
  • p0lly
    p0lly Posts: 134 Forumite
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    Hi Just a quick query I have this company chasing me for a debt I do not owe. I have asked them for the credit agreement over a month ago and they have written to say the company are still trying to retrieve it from their archives. They say they will not be in touch again unless they have the agreement. I am wondering should I just leave at that or will this be on my record ? TIA P0lly
    JBFF # 20 NSD 12/25
    Jan Grocery budget £77 /100
  • singlewhytemail
    singlewhytemail Posts: 1 Newbie
    edited 14 November 2012 at 2:25PM
    Options
    hi there, i am looking for some assistance with some solutions to resolve my current financial situation which i've summarised below;

    i have unsecured debts of around 9k which i am unable to meet due to a decrease in salary. having read about the different options i have, the ones i am looking at are a DMP and IVA.

    i would prefer to write these debts off over a 5 year period via an IVA, rather than applying for a DMP, as i believe the DMP process would take longer to resolve and would not include writing off any debt. at the moment i am not in a position to resolve these debts on a monthly basis as they are with 4 different companies who are asking me to pay more than i can afford.

    i have been a homeowner for 8 years and earn 21K a year so hopefully these debts are resolvable using one of these methods, after mortgage and bills i have around £300 per month which i could use as repayment for these debts. i'd really appreciate some advice on the best way forward for me as i'd like to start 2013 on a better financial footing.

    :money:

    sincere thanks
  • r6joe
    r6joe Posts: 13 Forumite
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    Hi,
    I have been contacted by a debt recovery agency about a debt I dont recognise. I sent them the standard "prove it" letter to which they have replied saying that because it is an "O2 mobile phone account" they do not have to produce any documents. Is this true and do I just have to pay a bill I dont think I owe or are they trying it on?
    Thank you
    Joanne
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