Struggling with debt? Ask a debt advisor a question

Barrex

Hi everyone!

I'm in a bit of a situation with my finances currently. It all started when I was studying for a degree. My circumstances did not enable me to get a student loan at the time (because I had not been a resident in the UK for 3 full years at the start of my course, missed it by about 4 months), so after checking this website to find the best student account I went ahead and applied for a Co-op one.

They provided me with a £2000 interest free over-draft until the moment in time when 1 year has passed since the end of the degree. This is quickly approaching now, there's barely two months left and as some of you may know, Co-op do not reduce the overdraft limit gradually across a number of years like some graduate accounts do.

This puts me in the situation that I have 2 months left to pay this off before they start charging what I imagine is quite severe interest.

It gets worse. Since I maxed out the overdraft in the first two years of the degree, I made the stupid mistake of starting to use Wonga, not realising the huge consequences this would have in the long run. It all started snowballing and now I'm finding myself reaching the situation where I have to give them my entire paycheck on pay day and apply (more or less immediately) for another loan to get me through the month.

As you might have guessed, I am employed. I'm working full-time and I honestly believe the overdraft would have been paid for long ago had it not been for my situation with the payday loans company.

I need to do something to get this sorted, but frankly I'm not sure where to begin. I have done some reading on debt consolidation thinking this might be the way forward. Ideally I would like to pay back about £200 a month for however long it takes to clear the debt, as I do have rent and utility bills to pay on top and still need to afford to live. It's safe to say my credit rating is less than great, so applying for the standard low-interest loans is out of the question as I would not get accepted.

Any thoughts from anyone will be sincerely appreciated, I will take everything into account when considering the best way to deal with this is. It would be great if you could include any information relating to how a particular solution affects credit scores too, as although mine is not particularly good, I would like to avoid making it worse.

Thank you!

florida2015

hi

I bank with Barclays I have a 1890 approved overdraft I am paying 22.00 a month interest on this plus 6.50 acc fee I also have a loan with Barclays which stands at 5800 at the moment and I pay 173 a month on this I also have 975 on a credit card and a small amount on a next card. i am starting to struggle to pay things off and live day to day comfortably i do have enough to cover min payments

recently i have been going over my overdraft and have had charges what i have done now is opened a basic current account with Lloyds no overdraft i have transferred my dd and all the money i have wages ctc wtc etc into the new account i plan to pay 80.00 a month into the Barclays to hopefully start making a dent in the overdraft and to not bank where i have debt should i have done this ? will i get in trouble with Barclays ?

i know the position i am in is not as bad as some but i want to try and sort things out at the moment i'm just getting by not living and can only see it getting worse i'm a single /divorced mum with one child so it is a struggle

any advice would help thanks just want to know if i did the right thing with Barclays

mum2one

florida2015 wrote: »

hi

I bank with Barclays I have a 1890 approved overdraft I am paying 22.00 a month interest on this plus 6.50 acc fee I also have a loan with Barclays which stands at 5800 at the moment and I pay 173 a month on this I also have 975 on a credit card and a small amount on a next card. i am starting to struggle to pay things off and live day to day comfortably i do have enough to cover min payments

recently i have been going over my overdraft and have had charges what i have done now is opened a basic current account with Lloyds no overdraft i have transferred my dd and all the money i have wages ctc wtc etc into the new account i plan to pay 80.00 a month into the Barclays to hopefully start making a dent in the overdraft and to not bank where i have debt should i have done this ? will i get in trouble with Barclays ?

i know the position i am in is not as bad as some but i want to try and sort things out at the moment i'm just getting by not living and can only see it getting worse i'm a single /divorced mum with one child so it is a struggle

any advice would help thanks just want to know if i did the right thing with Barclays

Someone will be around from CCCS tomorrow, but youve taken the best step in changing bank accounts to a basic account
I know you say you can pay £80.00 pm to Barclays - but I really would suggest filling in the debt rememdy plan by CCCS - this cover all your outgoings and incomings and what is spare then goes to creditors.

I did a self managed DMP for 12 months, but I have been with CCCS for 7 months, and they have been really helpful.

At the mo ur paying £28.50 to barclays for your account, plus your other expenses, but your having trouble with that, yet you want to pay £80.

I would say notify them that there is a problem and your seeking advice, this will give you some breathing space to get money sorted and also the bank will know that your acting responsibility, and not burying your head in the sand.

You've taken charge of the problem, thats a lot more than a lot of people do xx

florida2015

thanks mum2one for replying

i did speak to stepchange and after i gave them my info wages benefits etc they offered me a dmp but i forgot to include the 250 housing benefit i receive so after i called them back and told them this they said with what i have coming in a dmp would not be right for me and that i needed to budget to have more funds free to clear debts easier said than done

however it is my responsibility to do this so that's my plan create a budget and try to change the way i'm living i wouldn't mind except i really don't live excessively maybe i should put all my figures up on the boards here to see if anyone can shed any light on where i'm going wrong xx

Darren1980

Advice needed,

I have around 10k on a 0% barclays balance transfer card - this runs out on august 31st. By this time I will be able to have the debt down to around 4k (without missing any payments anywhere else) so I am not struggling to make the payments but want to avoid the interest hike come 31st august. I have applied for and subsequently been rejected for balance transfer cards so my credit is now only rated as fair.... what advice could you give to avoid the interest hike or recommend a short term loan company that I could use?

StepChange_James

Barrex wrote: »

Hi everyone!

I'm in a bit of a situation with my finances currently. It all started when I was studying for a degree. My circumstances did not enable me to get a student loan at the time (because I had not been a resident in the UK for 3 full years at the start of my course, missed it by about 4 months), so after checking this website to find the best student account I went ahead and applied for a Co-op one.

They provided me with a £2000 interest free over-draft until the moment in time when 1 year has passed since the end of the degree. This is quickly approaching now, there's barely two months left and as some of you may know, Co-op do not reduce the overdraft limit gradually across a number of years like some graduate accounts do.

This puts me in the situation that I have 2 months left to pay this off before they start charging what I imagine is quite severe interest.

It gets worse. Since I maxed out the overdraft in the first two years of the degree, I made the stupid mistake of starting to use Wonga, not realising the huge consequences this would have in the long run. It all started snowballing and now I'm finding myself reaching the situation where I have to give them my entire paycheck on pay day and apply (more or less immediately) for another loan to get me through the month.

As you might have guessed, I am employed. I'm working full-time and I honestly believe the overdraft would have been paid for long ago had it not been for my situation with the payday loans company.

I need to do something to get this sorted, but frankly I'm not sure where to begin. I have done some reading on debt consolidation thinking this might be the way forward. Ideally I would like to pay back about £200 a month for however long it takes to clear the debt, as I do have rent and utility bills to pay on top and still need to afford to live. It's safe to say my credit rating is less than great, so applying for the standard low-interest loans is out of the question as I would not get accepted.

Any thoughts from anyone will be sincerely appreciated, I will take everything into account when considering the best way to deal with this is. It would be great if you could include any information relating to how a particular solution affects credit scores too, as although mine is not particularly good, I would like to avoid making it worse.

Thank you!

Hi there,

From what you've said it sounds like the payday loans are the first thing to look at sorting out. While you continue to make full payments and then taking out further loans you'll be trapped in a cycle which is hard to get out of.

I'd suggest reading this article about how to deal with payday loans: http://moneyaware.co.uk/2013/01/payday-loan-debt-help-what-to-do-if-you-cant-afford-the-payment/. Follow the link to the template letter and then use it to stop payments and then you can look to pay them by installments.

Following that I'd suggest using our advice tool, Debt Remedy (http://www.stepchange.org/msehelp) which will be able to look at your finances and produce a personal action plan for you.

It's hard to say what solution will suit you best but it sounds like consolidations loans might not be a great idea if you're credit rating isn't great. It may be that the best solution involves taking further knocks to your credit history in the short term, but we'll advise you of the implications of the various strategies when you go through Debt Remedy.

Kind regards

James

StepChange_James

florida2015 wrote: »

thanks mum2one for replying

i did speak to stepchange and after i gave them my info wages benefits etc they offered me a dmp but i forgot to include the 250 housing benefit i receive so after i called them back and told them this they said with what i have coming in a dmp would not be right for me and that i needed to budget to have more funds free to clear debts easier said than done

however it is my responsibility to do this so that's my plan create a budget and try to change the way i'm living i wouldn't mind except i really don't live excessively maybe i should put all my figures up on the boards here to see if anyone can shed any light on where i'm going wrong xx

Hi there,

Planning and then living to a budget is incredibly hard to do. I'd suggest going through the budget you put together with us and double checking everything in there is correct.

If anything is missing or underestimated then give us a call and we'll adjust your figures and see if it changes the advice we can offer. If everything is correct then trying to set up a system to live to the budget should be enough to get on track.

Different things work for different people, some people literally put their money into jam jars when it comes in to help them plan out their different parts of their budget. Others pin the budget to their fridge, so they have a regular reminder of their plan.

Changing bank accounts, like you've done, is usually a really positive step as it gets you out of the habit of being constantly in an overdraft and means you can then only spend the money that comes into the new account.

Posting your statement of affairs (SOA) in the main forum is a good way to get some really useful feedback. They may also be able to help you work out different ways to manage on a budget.

I hope this helps, but feel free to post any questions you might have.

Kind regards

James

StepChange_James

Darren1980 wrote: »

Advice needed,

I have around 10k on a 0% barclays balance transfer card - this runs out on august 31st. By this time I will be able to have the debt down to around 4k (without missing any payments anywhere else) so I am not struggling to make the payments but want to avoid the interest hike come 31st august. I have applied for and subsequently been rejected for balance transfer cards so my credit is now only rated as fair.... what advice could you give to avoid the interest hike or recommend a short term loan company that I could use?

Hi Darren,

We're not the best people to give advice about taking out new credit. If your credit rating isn't great then it's going to be tough to get cheap credit of any kinds, as the best deals usually have the highest expectation of credit ratings.

It's also important not to apply for too many forms of credit in a short space of time. This can make your credit rating take a short term dip as you start to look like a riskier prospect to potential lenders.

Martin Lewis' articles on cheap loans (http://www.moneysavingexpert.com/loans/cheap-personal-loans)and balance transfers (http://www.moneysavingexpert.com/credit-cards/balance-transfer-credit-cards) are good places to get advice on these things.

If you're worried you won't be able to afford your debt payments we can give you more in depth advice. Contact details are in my signature.

Kind regards

James

moreira38

hi i hope you can advise me,10 years ago or nearly 10 ago i contacted a solicitor to represent me with the legal custody of my two young children at that time my two children now are 18 and 16 years old,i could not afford to pay the solicitor no more as the childrens dad made things so dificult that i went into the ground financialy i could not fight for my children custody no more so my solicitor obviously dindt represent me no more,but i stayed in debt over 5 thousand pound,now 10 years later i had a bayliff at my door regarding this debt with the solicitor i havent heard from them for 10 years,he did ask me my name and i confirmed it,after 10 years am i still liable to pay this debt or the debt is now null?? can they do this? please some advice would be great thank you very much

StepChange_Private_Messages

moreira38 wrote: »

hi i hope you can advise me,10 years ago or nearly 10 ago i contacted a solicitor to represent me with the legal custody of my two young children at that time my two children now are 18 and 16 years old,i could not afford to pay the solicitor no more as the childrens dad made things so dificult that i went into the ground financialy i could not fight for my children custody no more so my solicitor obviously dindt represent me no more,but i stayed in debt over 5 thousand pound,now 10 years later i had a bayliff at my door regarding this debt with the solicitor i havent heard from them for 10 years,he did ask me my name and i confirmed it,after 10 years am i still liable to pay this debt or the debt is now null?? can they do this? please some advice would be great thank you very much

Hi Moreira38,

There should be a ‘limitations period’ on the debt under The Limitations Act 1980 - this means the solicitor would have a certain period of time to chase you for the debt. This is usually 6 years.

Before you make any payments or send any written confirmation you could speak to the bailiff – get an address and send a letter asking them to send proof of the debt and of the last payment you made towards it.

Write “without prejudice” at the top of the letter – this way you are not admitting the debt in writing.

You can then take it from there checking if the debt is in limitations period or if it is statute barred (non-enforceable).

Hope this helps,

Jess