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StepChange_James

lisac123 wrote: »

Hi

I would like to ask for help in that i have loans and credit cards that i have never missed payments on.

I am a homeowner, again, never missed a payment on my mortgage.

I need to get my debts into one monthly manageable payment.

What are my options, lenders will not lend due to the amount of borrowing i have.

Thank you.

Lisa

Hi Lisa,

There are a few ways to get debt into one monthly payment. Here are the ones I can think of;

Consolidation loans - Can lead to paying a lot more back over time, so often not the best solution.
Secured loans - Taking out a second mortgage to pay off unsecured debts. We usually advise against these as it puts property more at risk.
DMPs - Reduced payment plans where a third party negotiates informal lower payments on your behalf (we do these for free when they suit your situation)
IVAs - A more formal payment plan where you commit to make payments (usually for 5 or 6 years) and if you keep up to payments you get some debts written off at the end. Home owners usually have to commit to putting some equity into the IVA too.
Bankruptcy - If you go bankrupt the courts may ask you to pay a monthly amount through to them from your disposable income. Homeowners often lose their properties in bankruptcy, but this depends on how much equity you have in the house.

As you can see, there are a few different options and it totally depends on your circumstances which would suit you best. I'd recommend getting in touch with us and we'll help you know what options you've got and which of them might suit you best.

You can do this online here: http://www.stepchange.org/msehelp using our Debt Remedy tool. Or you can give us a call (http://www.stepchange.org/Contactus.aspx) and we'll give you advice over the phone.

All the best.

James

p.s. I hope I've not thrown too much information at you here. Don't worry about following everything, if you get in touch with us we'll guide you through and explain it all.

WeesieWeasel

I have a Barclaycard that I took out in about 2008. I was told I had to have their Plan B payment protection, which is now costing me around £12 a month. I was told I had to have it to cover my payments should I fall ill or lose my job. I didn't really want the extra charge but was told it was very important....I felt pushed into buying it.

In 2009 I got very sick and eventually lost my job in 2010. I am now classed as disabled and unable to work. I get just over £400 a month in benefits. My husband earns around £18000 a year (before tax) so money is pretty tight.

I moved in 2011 and forgot to transfer my barclaycard statements straight away. I recently sorted everything out but imagine my surprise when I find I owe over £1400 on a card I haven't used since early 2011! The minimum payments haven't been enough to cover the interest and the plan b. As a result I have been charged for being over my limit. I can't get into my online account to see how long they have been charging me this.

I read the small print for the plan B and it seems I can't claim for being ill as I'd need a note from my employer, which I no longer have. It covers short term illness but has nothing in place for what has happened to me. Turns out I was paying this insurance that I didn't really want for nothing!

My debt is going up each month. In January I owed £1406, I made the minimum payment and now I owe £1423. I would make more than the minimum payment but I am already in my regular barclays account overdraft. My husband pays all the bills/rent (and is £5000 in debt on his barclaycard plus £1000 on his Santander account) so my disability benefit covers things like food and emergencies like vet fees.

I know I'm not as in much debt as most people on here but I have no idea how I'm going to pay this off, especially since the amount keeps increasing. It's not great for my already poor health

Thanks for any help/advice!

EDIT: The plan B also only covers you if you are fit and looking for work.

StepChange_James

kelly023 wrote: »

Hi there,

My partner is self employed and hasn't worked in 6 weeks and I'm a little behind on my payments to cc's. (before this he worked for a few months but was then out of work for 3 years so been tight over few years.)

He been taken on the books now but needs to work a week in hand.

So half anyway through feb I'll have my excess money again and can start paying ,arrears. I think I'll be 3 months in arrears in 1 before paying the arrears off.

Is this better than arranging a dmp?

Thanks

Hi Kelly,

Thanks for posting. If you're going to be in a position where you can make full payments to your debts plus pay extra on them to catch up with the missed payments then that's a good plan.

Planning a budget to make sure you can cover the payments to debts and have enough left to live off is also a useful thing to do.

Providing you can afford it, then it's better to maintain payments full payments than do a DMP. It's better for your credit rating, there's no risk of creditors not co-operating and it's generally easier.

I'd suggest trying to pay more than the minimums on your cards whenever you possibly can too, as you'll then start to see a lot more progress with bringing down the balances.

If it's not affordable to get back on top of these debts then get in touch with us and we'll talk you through other options, including DMPs.

All the best.

James

StepChange_James

WeesieWeasel wrote: »

I have a Barclaycard that I took out in about 2008. I was told I had to have their Plan B payment protection, which is now costing me around £12 a month. I was told I had to have it to cover my payments should I fall ill or lose my job. I didn't really want the extra charge but was told it was very important....I felt pushed into buying it.

In 2009 I got very sick and eventually lost my job in 2010. I am now classed as disabled and unable to work. I get just over £400 a month in benefits. My husband earns around £18000 a year (before tax) so money is pretty tight.

I moved in 2011 and forgot to transfer my barclaycard statements straight away. I recently sorted everything out but imagine my surprise when I find I owe over £1400 on a card I haven't used since early 2011! The minimum payments haven't been enough to cover the interest and the plan b. As a result I have been charged for being over my limit. I can't get into my online account to see how long they have been charging me this.

I read the small print for the plan B and it seems I can't claim for being ill as I'd need a note from my employer, which I no longer have. It covers short term illness but has nothing in place for what has happened to me. Turns out I was paying this insurance that I didn't really want for nothing!

My debt is going up each month. In January I owed £1406, I made the minimum payment and now I owe £1423. I would make more than the minimum payment but I am already in my regular barclays account overdraft. My husband pays all the bills/rent (and is £5000 in debt on his barclaycard plus £1000 on his Santander account) so my disability benefit covers things like food and emergencies like vet fees.

I know I'm not as in much debt as most people on here but I have no idea how I'm going to pay this off, especially since the amount keeps increasing. It's not great for my already poor health

Thanks for any help/advice!

EDIT: The plan B also only covers you if you are fit and looking for work.

Hello and welcome to the forum,

I'd say there are two things to sort out here:

1) Should you actually owe this money, as it sounds like much if not all of the balance relates to insurance you didn't want.

2) If you do owe the money, how will you pay it back.

While we can give you lots of advice and support on how to pay back debts, I'd suggest holding back on paying this debt back until you are certain you actually owe the money.

So I'd recommend looking into whether you were mis-sold your insurance. MoneySavingExpert.com is arguably the best place to get help on this sort of thing. This page is the best place to start: http://www.moneysavingexpert.com/reclaim/ppi-loan-insurance/.

If, after looking into it, you find that there is a balance to pay back on this debt then please get in touch with us and we'll give you advice on organising affordable payments (if that's the best route).

Hope this helps.

James

Foxi27

Hi,
I think what I need may be reassurance as well as advice! I set up a restaurant jointly with my mother in 2005, which due to many and varied circumstances closed in 2009. Since then, I have become a full-time student and am not earning.
However, I recently had the opportunity to pay off what I thought were the outstanding debts from our business. Having done so, I requested a credit report from Experian...
SHOCK HORROR!... only to find an outstanding CCJ in my name for £24,000! It makes me feel ill just typing that amount, I never thought I'd owe that much money in my life!
Anyway, to cut a long story short, we left the restaurant before the end of our contract and so I am very sure that this newest debt comes courtesy of our old landlord. Since we have moved from our old house address this would also be why I had no inkling of this debt, otherwise I would have done something about it much sooner.
My worry is this; the judgement is dated 2010. How do I go about trying to pay it off, since I have no regular income and could only afford maybe £30 a month? More importantly, my new home address is my boyfriend's home. I'm afraid baliffs will appear and try to take his possessions which have absolutely nothing to do with this.
I would dearly love to hear any advice you could give me. Many thanks, Foxi27 :eek:

supersavershal

StepChange_James wrote: »

Hello,

I think mum2one has cleared this up already, but just to confirm, this should be fine. There's no problem with having two bank accounts providing they're with banks you don't owe money to (which you don't).

The switching service shouldn't be a problem either. I'd suggest checking to make sure they won't give you an overdraft or transfer the balance from your old account. If you're clear you don't want one they shouldn't put one on.

If you can spare the time, it would be really nice if you could come back and post on here about how you've got on with the switching service. We often suggest people use these switching services but rarely hear how useful people have found them.

Kind regards

James

Thank you James, I decided to go into branch and they are in the process of switching my direct debits, I made it clear it was only my DDs to be switched and they were fine with that.
I will let you know how it all goes, most of my DDs are due on the 1st and they say it can take up to four weeks to switch them, im hoping that is the longest time. In any case if they are not done in time I will pay with my debit card over the phone.
Thanks for replying and Mumtoone.

Former_StepChange_Rachel

Foxi27 wrote: »

Hi,
I think what I need may be reassurance as well as advice! I set up a restaurant jointly with my mother in 2005, which due to many and varied circumstances closed in 2009. Since then, I have become a full-time student and am not earning.
However, I recently had the opportunity to pay off what I thought were the outstanding debts from our business. Having done so, I requested a credit report from Experian...
SHOCK HORROR!... only to find an outstanding CCJ in my name for £24,000! It makes me feel ill just typing that amount, I never thought I'd owe that much money in my life!
Anyway, to cut a long story short, we left the restaurant before the end of our contract and so I am very sure that this newest debt comes courtesy of our old landlord. Since we have moved from our old house address this would also be why I had no inkling of this debt, otherwise I would have done something about it much sooner.
My worry is this; the judgement is dated 2010. How do I go about trying to pay it off, since I have no regular income and could only afford maybe £30 a month? More importantly, my new home address is my boyfriend's home. I'm afraid baliffs will appear and try to take his possessions which have absolutely nothing to do with this.
I would dearly love to hear any advice you could give me. Many thanks, Foxi27 :eek:

Hi there, thanks for posting.

When it comes to CCJ’s, they can often lie dormant on your credit file as your one for £24,000 currently is. As the CCJ has now gone forthwith (this is the term the court uses when a payment arrangement wasn’t made on time) they can instruct bailiffs to visit you. We would always recommend NOT letting a bailiff into your property under any circumstances. They can only come into your property if you give them an opportunity to do it peacefully, like leaving a door open or a window unlocked so they can climb in. Once in, they get something called Walking Possession which means they can come back to levy goods when they wish.

I would recommend that you find out what County Court put this CCJ in place (you can usually see this information on your credit file). Once you’ve done this, download an n245 form here: http://hmctsformfinder.justice.gov.uk/courtfinder/forms/n245-eng.pdf

This is called a variation of an order form. It’s a budget form of sorts where you can outline to the court how much you have coming in every month and what you have going out. You can then make an offer to the court in section 11 stating what you can currently afford to pay each month (even if it turns out you can only afford £1 a month, still put it down).

There’s a fee of £35 to process the n245 form that you must include in the as a cheque or money order with the form. If you’re on low income, there’s a form called the EX160 that you can enclose with the n245 form and if you fit the criteria for low income, the court will refund you the £35 once your monthly payment offer has been processed. You can download the EX160 here (there's quite hefty guidance notes that you don't need to print out so make sure you only print the necessary pages to save ink): http://hmctsformfinder.justice.gov.uk/courtfinder/forms/ex160a-eng.pdf

I would also download a second copy of the n245, so that if a bailiff does visit you, you can put it up against the window and point at it. This is usually indication enough to the bailiff that you’re doing something about the CCJ.

It wouldn't hurt to get some more long term advice on your whole situation. We're a registered charity and we can give guidance on how you're best managing your finances moving forward. Call us on 0800 138 1111 or try our anonymous online advice tool Debt Remedy: http://www.stepchange.org/msehelp

Hope this helps – post again if you have any further questions


Best regards

Rachel

Kellsmc1

Hi all

I have foolishly overspent on credit cards and now I am paying out a fortune each month. I really want to get all my debts in one place and get them paid once and for all but I dont want to damage me credit score by applying for all sorts of loans with no hope of getting them. Please help.

safcjohnny

Hi, I’ve been looking into DMP’s & IVA’s and would be grateful for any advice you can offer.

I owe about £31K (four credit cards, a loan and overdraft) and have reached the point where even making the minimum payments every month is now a major struggle and I’m not left with anywhere near enough money to live on. Recently it’s got to the point where I’ve been having to miss a months payment on some of the cards so that I can scrape by. This obviously incurs late payment fees and over limit fees and as a result my credit rating must be zero. Currently all payments are at least up to date but all the cards are up to or close to their limits. I’m not blaming anybody else, this is all down to my bad money management in the past, I’ve seen this day coming for a while now but have buried my head in the sand hoping something (what, I don’t know!) would happen to magically bail me out.

My background is that I split from my partner about two years ago but still pay some of the household bills and pay her maintenance monthly for our two kids (aged 9 & 15). I haven’t formally moved out of the house but haven’t lived there since 2011. I currently rent a room from a friend and contribute towards the utility/food expenses there. The house with my ex partner is owned outright as tenants in common (50/50) with no mortgage, I wanted to remortgage in 2012 to clear my debts but was advised by an IFA that I couldn’t do this without the agreement of my ex partner. Originally she agreed but after months of deliberating she told me she wasn’t prepared to do it despite my reassurances that I wouldn’t default on the mortgage, I don’t suppose I can blame her given my track record. I’m 48 in regular employment earning £28K per year and have been in a local government pension plan for 30 years. I really can’t see any other way to begin to clear what I owe as the interest I’m paying is crippling me. I’m wondering specifically if me owning half the house, even though I can’t get at the equity in it, will affect my chances of a successful DMP or IVA.

Any advice would be very much appreciated – I’m desperate.

StepChange_James

KellsMC1 wrote: »

Hi all

I have foolishly overspent on credit cards and now I am paying out a fortune each month. I really want to get all my debts in one place and get them paid once and for all but I dont want to damage me credit score by applying for all sorts of loans with no hope of getting them. Please help.

Hi Kelly and welcome to the forum.

I wouldn't beat yourself up about the credit cards, doing the job I do has taught me that this sort of thing can happen to almost anyone.

It's an interesting questions about what to do next. You're right to think that applying for lots of consolidation loans is going to make you look less credit worthy.

We actually advise against consolidation loans most of the time anyway. They can often end up stretching the debt over a longer timescale and lead to repaying a lot more on the debts.

Regardless of the next steps, it would be a good idea to plan a detailed income and expenditure budget that will tell you more about your finances. You can do this using our online advice tool Debt Remedy(http://www.stepchange.org/Contactus.aspx).

While I'm not sure if your finances are so stretched that you might struggle to keep up with paymetns, Debt Remedy will offer you advice about debt solutions if the payments are a struggle. If not it will still help you plan a budget and give you some money tips.

I hope this helps. Another handy place to look might be the loans section of the main MSE site: http://www.moneysavingexpert.com/loans/cheap-personal-loans. But obviously make sure you only look at loans you can comfortably afford and consider if it will cost you more in the long term.

Kind regards

James