What will happen when I offer token payments?

mrsjones2be

Ok so if you have seen my previous I'm looking at moving back into a properly I own with hubby he has moved out.
However, I'm not goin to be able to afford min payments on my credit cards I owe aprox £5500 on 5 cards & 1 overdraft.

I have been on step change an filled in there debt remedy form an it came out saying I should offer payments if £1.00 until my situation improves.

I could offer £5 -£10 per creditor every month.

What happens if I do this?? And how do I do this ?

Will they accept it, or just default me ? My credit rating is shot to pieces anyway so more defaults won't hurt.

eyeopener2

Go to the national debtline website and you will find a template letters that you can use. Send that and await the response.

You can include a statement of affairs to show your being serious about it as well.

You could phone them all, tell them the situation and just pay your token there and then but you could be badgered into paying more than you want to. So be wary.

Have a look at the national debtline, you will find a lot of info there. The link is at the top of this page in the stickies.

Most creditors are ok if they believe your situation is short term. I

catandy

I was in the same boat with making nominal payments of £1 - I did everything in writing using a template from Stepchange and a copy of my SOA and just made the payment - I had 6 cards, 2 phoned me up to ask me to pay more and I explained I wasnt currently in a position to do so.. 5 out of the 6 froze all interest and 3 months in none had jumped with defaults. I just made sure that I made the promised payment without fail each month.

Now I'm in a position to speak with them and arrange a proper payment plan and they have been receptive to that as well - Im not able to clear all the arrears on my accounts in one go so ive arranged to pay a bit extra over the next 3 months to bring my accounts up to date... then its time to pay extra at the highest interest one and start to clear them completely.

Dont leave yourself short - make sure you make the payments as per the agreement you make with them and keep them in touch with any changes ie ability to pay more etc. oh and dont let them bully you - because some of them will try

good luck

mrsjones2be

Thanks for your replys , should I offer them £5 or £1?
Did u ask them to freeze Interest?

My other question is 2 of my cards are with Barclays who I bank with the others are Halifax and Santander.
Barclays have on several occasion taken payments out of my current account for the cards .
Should I change bank accounts ?

Find_The_Real

Just to add to this, if any of your creditors are the linked to the bank you have your main account with, before you contact them open a new basic bank account and swap any payments and direct debits over, that way they can't offset any money you have to pay for the debt.

I went through StepChange itself for my DMP so it may be worth giving them a ring and they will go through the whole process and budgets with you.

Good luck and I hope it all goes well for you.

Update - posted same time as OP so that would be a yes to a new bank account!!

eyeopener2

Barclays are complete swines, so make sure you open a new account.

catandy

ditto regarding barclays and the same for halifax as well

you need a new totally 'clean' bank account with no connection to the companies you have debts with.

I would pay them the £1 for now, get yourself back on your feet then make an agreement to pay. Wont make any difference to them regarding £1 or £5 if they freeze interest or slap on a default they seem to please themself anyway as everyone seems to get different results

and put in your letter that you want them to freeze interest - worked for me so fingers crossed for you as well.

DS4215

If you can genuinely afford to pay £10 per month to each card, why not offer them £1 each and put the other £9 away each month. As it builds up you might be in a position to make a F&F offer to the smallest debts and clear things off that way..