Considering a debt managment plan

StephenUK

Hi all,

Firstly sorry if there are any typos in this I am using my phone.

I currently have a debt of around 4500 / 5000. These are as follows:

- 3100 overdraft to lloyds TSB ( 100 unauthorised )
- 760 to Provident Personal Credit
- 600 to Wonga payday loans ( 900 with interest on due date)
- 530 to QuickQuid ( This is not my debt but its in my name. I got it to help my mum out she is paying it at the end of this month)

I have tried getting a consolidation loan as the I'd save money and it'd be very affordable but I am uneligible apparently.

My NETincome is between 250 - 310 a week. I am 21 and live at home so my rent is fairly low. I am also owed an additional 525 by my mother who I said she can pay back at her leisure.

I am starting to stess out I just want to get all this sorted out. This has been caused by a drink problem coupled with an online gambling problem.

Should I go ibto a debt management plan or should I just try to tackle these myself? I know its not a lot of money in real terms but its effecting my immediate cashflow significantly.

Ive already got a new bank account set up and ready to go with NatWest, should I make it so my pay goes to that account and begin to move forward with the DMP?

Thanks

frugalqueen_2

hi I was in £45K of personal debt and paid every penny back and you can too - just google my name and you'll find me.

1. Get two jobs - you have no children, you can work weekends and evenings
2. sell any stuff you have on ebay
3.give up smoking and drinking - you'll have money
4. take a packed lunch and drink to work - you'll have money there
5. tell mum she needed pay the loan back but can you have so many weeks rent free to use the money to pay off debts
6. payback the wonga type loans first - for a few weeks pay them £100 a week - pay the minimum to all the others
7. Set yourself a £20 a week challenge and live off that - google my name and see how
8. stop spending any money - you have debts - pay them off, not doing so is immoral
9. get to your GP about your addictive behaviour
10 - you won't like this - grow up, get a back bone and take responsibility for your actions

frugalqueen_2

hi I was in £45K of personal debt and paid every penny back and you can too - just google my name and you'll find me.

1. Get two jobs - you have no children, you can work weekends and evenings
2. sell any stuff you have on ebay
3.give up smoking and drinking - you'll have money
4. take a packed lunch and drink to work - you'll have money there
5. tell mum she needed pay the loan back but can you have so many weeks rent free to use the money to pay off debts
6. payback the wonga type loans first - for a few weeks pay them £100 a week - pay the minimum to all the others
7. Set yourself a £20 a week challenge and live off that - google my name and see how
8. stop spending any money - you have debts - pay them off, not doing so is immoral
9. get to your GP about your addictive behaviour
10 - you won't like this - grow up, get a back bone and take responsibility for your actions

StephenUK

I know I have to pay back the debt, and I have already taken reaponsibility Im asking what the best solution is. I already work 60 hours a week (6 nights) so a second job is not really feasible.

If I do it alone Ill probably end up paying a few late fees and possibly a default for a week or so. Ill also be quite low on cash for the next few weeks. So is it a debt management plan I need?

fermi

A DMP won't necessarily stop fees or defaults. Especially in the short term where you are looking at reduced income, as will take a month or so to set up.

Short term, if you are not going to be able to meet full payments, would be to talk/write to creditors to explain this and ask for any period of grace/options that they might be willing to give.

See on the main site: http://www.moneysavingexpert.com/loans/debt-help-plan

Then in the meantime look at the other options.

You could easily self manage a payment plan with just a few creditors. Many do here. Conversely, a DMP is good for relieving you of the admin burden of that, feeling that you are in a structured/supported plan, and perhaps (debatable) a better chance of charges/interest being stopped in the long run. Often it's more a case of how you feel rather than what is "best".

Perhaps post a more detailed SOA here to see what can be thrown at the debts. Your summary is a little unclear on that.

jubilee14

Hi Stephen UK am in the debt situation and due to size of the debt have had to go down the DMP route which is fine however it does mean i will never get credit again and probably have to stay with the mortgage company i have whether rates go up or not for the next 6 years minimum.

You are 21 so undoubtedly you will want to get some credit in time to come for a mortgage/car and if you go down DMP route you are impacting your chances and there is no chance if you wanted to in the next 6 years. Your debts are not unbelieveablly extoritionate and if you are working at 60 hours a week and are on minimum wage you must be bring in a reasonable amount ( in excessive £1200 a month along with the fact you stay at home your rent is low)

So i would say knuckle down and manage it out with a bit of work it should be paid well before the 6 years that your credit will be affected if you go DMP. Its different for everyone and dont take any more credit out!!! Good Luck

sickasachip13

frugalqueen wrote: »

8. stop spending any money - you have debts - pay them off, not doing so is immoral

10 - you won't like this - grow up, get a back bone and take responsibility for your actions

Hey Stephen,

I just wanted to respond quickly by saying well done on acknowledging the problem and admitting you have an issue with gambling.

You could manage these debts yourself with a good plan - follow Fermi's advice in the first instance. I'm in a DMP but went in with significant debts. Mind you, if I'd acknowledged I had money management problems at your age, I might have been more savvy and avoided shedloads of mine!

To FrugalQueen, hats off for paying your debt off in full, that's great. But, I'm not sure how helpful the OP will find the statements above - he's already said he wants to pay and is feeling stressed - being told that he's behaving immorally and has no back bone is hardly the supportive approach that these boards should be about.

Good luck Stephen, get an SOA posted and I'm sure people will have useful info.

SAAC

Max_Maxwell

If I'd had your foresight about my debt when I was your age I would have been debt-free 20 years ago. Well done for stepping up and tackling the issue.

You are in a stronger position than most to deal with this head on. You are working, living at home and child-free. Before looking at the DMP route talk/ write to your creditors directly and tell them you are struggling. Tell them you wish to sort things as quickly as possible and before it gets out of control but you need their help. Lenders must be seen to be flexible and accommodating to borrowers in financial difficulty, as long as the borrower plays fair and communicates. Don't default without talking to them, it will be so much harder to gain their favour without doing the right thing.

They might offer to reduce payments for a period of time, or hold the interest. The important thing is for you to work out what you can reasonably afford and communicate that to them.

A borrower taking control of the situation is far more likely to gain help and trust from a lender than the one who walks away without a word.

antonic

I have 7 months to go to clear my £22k debts, via a DMP with Payplan.

If you choose the DMP route choose a free provider like Payplan, Christians Against Poverty or Stepchange DO NOT use a fee paying one.

Congrats on facing up to the problem and for wanting to deal with it !.

ChopinonaBudget

Hi Stephenuk,
First of all, well done for taking trying to charge Of your situation, that's a huge first step.
If you post an SOA, the lovely people on these boards will offer you lots of advice in how you can organise your existing finances any better to help with paying back your debts; and that's not even including the advice you've been given about DMPs

Last but by no means least, these boards are meant to be a supportive environment, and for the most part they are. Plenty of people who come here are stressed, fragile, panicky or lost. Please don't tie to heart the words of the poster who told you to 'get a backbone' and that you were behaving immorally. His opinion (her?) is in the minority and should be disregarded as the mean spirited mouthpiece that it was.
Good luck. You're doing everything right so far, you can certainly get his sorted

sistafromanothermista

:wave: Firstly, well done on your LBM and wanting to do something about it.
Secondly, have you got any help/support for the gambling problem? if not, that should be your first port of call.