What can I do?

Endsmeet_2

Hi,
I really need some advice/help as what to do next?
I am living at home with my parents and have basically been living beyond my means for a number of yrs now, I thought that I was in charge of my debts and even though I am in debt, I was keeping on top of them.
My circumstances have changed now where I have met a girl who has children and within the next 5 yrs I aim to settle down and buy a house together.
I have 4 loans and 5 credit cards, the loans I have been paying off using my monthly pay and it left me with a small, but livable amount each month, my main problem is the cards, I worked out a way of getting thru all this by using each card to pay each other basically off robbing peter to pay paul.
But I have almost come to a point (about 3 months time) where my C.C. limits will have been reached and I will be unable to continue doing what I have been.
I based everything on a loan finishing in 12 months time then using that to pay extra off one of my C.C. and then it would be a roll on effect as another loan finishes 6 months later and so on. In 4 yrs time all my loans will be payed and what I was paying on them will be put towards my C.C. debts.
Because I have been stupid, the C.C. limits have almost been met and I will be unable to continue meeting the monthly min payment.
Even my pay rise which I will receive in 1 month time has been gobbled up by my employer as they are making changes to my pension scheme and require me to pay more each month for a final salary pension, I was due to finish paying it next yr and I would have been £85 a month better off but now they are insisting that I carry on paying, that has also taken a chunk out of my plan.
I have never missed a payment in 20 yrs or even defaulted on anything like this
Basically I have fell short by about 12 months
I have been reading all the advice that is available to me and the 1st course of action seems to be to contact the creditors of the C.C. and to tell them that I will be unable to meet the min payment and that I can pay a token amount ( say £10 ) a month and ask them to freeze the interest rates.
I am not very good on the phone and would like to send them a letter asking them for this option but I was wondering and would like advice on how good are they on accepting this?
Also is it possible to only deal with a couple of creditors at 1st, by only dealing with say 3 at 1st, would my remaining creditors become aware of my situation and freeze their balances or even demand that I pay their total balances back?
I have got my credit check from expirien and even though there are an awful lot of debts against me, none of them report a missed payment or anything like that.
I have applied for another C.C recently which is stupid I know but it offered 0% on balance transfers so I thought that I could save something there but I was not accepted by the creditors.
I have also applied to top up my loan and that was not accepted either.
My main concern is that if they do not accept my offer of a token payment, will they send around the bailiffs?
I do not own the house, my mother and father are retired and are almost 80yrs of age and anything like this would cause them great concern to put it mildly.
I have not slept properly for months now worrying about this, I am at the stage where I am thinking about it every waking moment and I even think about it when I am watching telly.
Its affecting my life so much that I am feeling so sick in the stomach and can't even concentrate on anything normal anymore
I am totally scared at what may happen to me and getting to the point of having bailiffs coming around...I don't wanna think about it.
Can anyone offer me advice about the creditors and how well they accept a token payment?
I have found the letter on the National Debt line website which would do but I only want to deal with 3 companies at first and I think that they want to know every creditor.
I want on carry on paying off my loans as normal but will the C.C. insist that I inform the loan companies of my situation and pay less to them thus extending the loan term or worse ?
It is really making me ill and even now, I feel like being physically sick.
Sorry for going on so much but can anyone help me with advice but I can-not talk to anyone , my friends or family?

FrugalJo

Hi Endsmeet
Welcome. I know the sick feeling, sleepless nights and the constant worrying as do many on here. You've posted on here now so the only way is up.

The more wise will be along in a minute with some excellent advice, but will suggest you post a full statement of affairs up, all incomings and outgoings with interest rates if poosible and they'll have you saving money in no time.

I'm pretty sure you can't offer one creditor one reduced payment and pay the full minimum on another, but the wizards will confirm that in better terms.

Toto

Hi endsmeet and welcome to MSE.

I'm sorry to read about your situation, lots of us have done similar things so you're not alone. Please try to relax, it's not worth making yourself ill over.

You really shouldn't pay one creditor over another, it's not fair to offer token payments to one so you can pay minimum payments on another. You should offer them all a pro-rata amount based on what you have available. I would certainly get some help with this. There are free charities out there who will negotiate with your creditors for you and organise a payment plan for you. Payplan, CCCS and the CAB are all great and I would certainly give one of them a call, they're really nice and non judgemental.

The other thing to do would be post a SOA, see the first time poster's sticky at the top of the forum page for a guide. We can then pick through and offer some advice based on your actual income and expenditure.

hypno06

Hi there and welcome to DFW.

I am not sure of the procedure regarding minimum/token payments as we have never gone down that route, but I would have a chat with National Debtline or one of the other FREE organisations eg CCCS or Payplan who will be able to give you some good advice and options.

It seems that you need to get through the next 12 months before you can start snowballing the debt using the loan payment which you will no longer be paying, and www.whatsthecost.com which can tell you in which order to pay the debts off, and how long it will take you to become debt free.

Have a look at SouthernScouser's sticky for first time posters at the top of these threads to get an idea of how to put together an SOA and we will see if we can come up with some ideas for you.

You have taken the first step now, so good luck on your DFW journey.

Endsmeet_2

Hi,
Thanks for making me feel so welcome, I have done a SOA below and it doesn't make happy reading, in fact it turns me white.
I haven't put on APRs on some as I am unsure of some of them, I tend to pay it/screw up the bill when I receive it.



Monthly income approx £1638 min net but can vary with overtime if avail and I try to do as much as I can but its not guaranteed so I've put minimum amount

Outgoings:

Egg Isa £10 p.m. savings
Egg saver account £15 p.m. which I use every 6 months for car tax

Overdraft £900 limit £200 owed which is payed off each month by salary going in

Rent £217 which includes food/internet/gas/elec etc
TSB loan 1 £411 p.m. balance £4,984 APR 8.9%
TSB loan 2 £413 p.m. balance £17,132 APR 8.9%
Egg Loan £426 p.m. balance £16,511 APR 6.9%
Lombard loan £197 p.m. 30 months left to pay
Black Horse car finance £85 p.m. 23 months left to pay
Virgin car insurance £21 p.m.

TSB advance c.c. £9590 balance - limit £10,000
Goldfish C.C. £12200 balance - limit £12,500
Cap 1 c.c. £2000 balance - limit £3200
Cahoot c.c. £6100 balance - limit £6500
Mint C.C. £7866 balance - limit £8300

Petrol £60 p.m. approx depending on usage
Weekly expense food and drink can vary but roughly £40
Mobile phone £10 p.m.
7 birthdays a yr approx £15 each
MOT £45 min
Christmas 7 people £20 each approx
prescription £6.70 a month
Dental/eye test are covered by medicash taken from wages


Not much else I can think of.

Endsmeet_2

Hi again,
Sorry for being a pain but I have a couple more questions
If I phone someone or go down the debt plan road will the house be affected, will the house I am living at become flagged as a debt house?
Basically will my Mum,Dad and Brother be still able to apply for credit or will it just be me, for obvious reasons I do not want them to be black listed because of my foolishness

Thanks again

Toto

I can see why you're feeling a bit overwhelmed ends, I was in a simillar position a year or so ago. There is good news in that if you take out all of the repayments you have a good surplus income to repay the debt on a payment plan. So, please please give one of the organisations we've mentioned a call. They really will sort you out and deal with your creditors for you. Honestly they've seen it all before so no need to feel ashamed.

When you do your SOA for them, make sure you add everything you need so you can budget properly. There's no point in throwing every single penny at the debt, leaving yourself without something you need and failing the dmp.

Things I can think are missing are

car insurance, mot
clothing
birthdays/christmas
dental
prescriptions
eye test?
internet
going out

I found it useful to sit down and go through a couple of months bank statements. From there I could see where I was actually spending money. Also, from now on it's a great idea to start a spending diary so you know where every penny has gone.

Toto

Endsmeet wrote: »

Hi again,
Sorry for being a pain but I have a couple more questions
If I phone someone or go down the debt plan road will the house be affected, will the house I am living at become flagged as a debt house?
Basically will my Mum,Dad and Brother be still able to apply for credit or will it just be me, for obvious reasons I do not want them to be black listed because of my foolishness

Thanks again

Don't worry, houses aren't blacklisted, it's the name which is credit scored. So long as you have no joint finances such as bank accounts your family won't suffer because your credit rating isn't 100%

Endsmeet_2

Hi Toto,
Thanks for your advice,
Which company would you recommend or are they all much the same, Ive had a look around the websites and to be honest, they are scaring me abit and all mention about being a house owner etc which I am not.
I will update my SOA above with a couple of things you mentioned but to be honest, I can't really say how much I spend per month on certain things as it varies so much, but I try to keep it within a certain figure which I will post.
Thanks so much for all your help so far

Toto

You're welcome.

Personally I would call CCCS or payplan, sometimes they have a bit of a wait so I would see which one can help you the quickest, they are both pretty much the same. The CAB are great because they will sit down with you and sort through it all, but some areas have a long waiting list for their debt counselling.

Please don't be scared, these people are on your side. They are charities set up to help people like us. They deal with and help thousands of people in debt every day and are very good at it. You don't need to be a homeowner, you aren't taking any loans. You don't need to have anything other than the desire to sort out the debt issue and to get your life back. I promise you that after a phone call to them you will feel as if you're 3 stone lighter and will probably get the best night's sleep you've had in a long time.

Endsmeet_2

Thank you so much,
I am so worried about all this now that I'm losing weight just thinking about it, I will give them a call on Tuesday as my house is empty for a couple of hrs then.
I just don't want my Mum and Dad to even get a sniff of my problems as they are far too old to have this thrown upon them.
How do they go about it ? Is it all done over the phone or do they send something for you to fill in?

Thanks again so much