On the edge of a right mess! Payday loans mainly - Any advice greatly appreciated

BigTone

Good evening,

Well as a previous DFW, I am sad to say that life has gone t*ts up over the last 18 months, I've been a bit of a plank and I am on the verge of a right mess.....again!

I have approx. 15k of debt, the majority of which I can manage and am willing to pay back in full as per the agreements I have entered into.
I would like to start saving some money so I have stopped smoking, 28 days so far, stopped drinking for the same and have been extremely careful with money, spending about £30 since the new year, excluding essentials.

This has made me review my financial situation and yesterday scheduled an appointment with payplan for some advice.

The aspect which really bugs me is the fact that I have 4 payday loans, totalling £2800, this months repayments alone total £2389.05 with a further £407.88 due next month.

I have a fairly good income and negating the payday loans, would have approx. £800-£900 disposable income, per month which could be saved towards the much needed mortgage! (brief SOA below)

My question is, am I better to try and grit my teeth and defer all but one payday loan, per month, until they are gone
or
do I take the risk of contacting the payday loan companies and entering into a repayment plan with them?

My priority is not to affect my credit rating to such an effect that it hampers my likelihood to get a mortgage.

I believe that payplan will advise me, but nothing is better than experience.

I am thinking that if I can just get rid of these payday loans, I can make decent headway into clearing the rest but to be honest, cannot see the wood for the trees at the moment.

Anything you can help me with is greatly received.

Thanks in advance

SOA
Credit cards - 5 accounts totalling 7,000
Loans - 3 accounts totalling £4,250
Overdrafts - 2 accounts totalling £2,800

Essential spends per month = approx. £1,200
Income £2,196 pcm after tax

[Deleted User]

BigTone wrote: »

My priority is not to affect my credit rating to such an effect that it hampers my likelihood to get a mortgage.

I fear you may have already seriously hampered your mortgage chances, when you took out the PDLs.

My advice is twofold.

1. Stop taking out PDLs.

2. Post a SOA, so the good people of MSE can advise you properly.

BigTone

Bedsit_Bob wrote: »

I fear you may have already seriously hampered your mortgage chances, when you took out the PDLs.

My advice is twofold.

1. Stop taking out PDLs.

2. Post a SOA, so the good people of MSE can advise you properly.

Thanks for the advice, are you able to expand on the reasoning behind this? does this mean that anyone who has taken out a payday loan has done the same? only one of the 4 appears on my credit report, forgive me but I simply do not know.

1 - Done

2 - SOA Below

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 0
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 2196
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2196
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 550
Management charge (leasehold property).. 0
Council tax............................. 0
Electricity............................. 0
Gas..................................... 0
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 30
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 5
Groceries etc. ......................... 160
Clothing................................ 0
Petrol/diesel........................... 350
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 25
Haircuts................................ 0
Entertainment........................... 50
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1170

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 2000 - own car due to reluctantly sell as I have a company car
Other assets............................ 0
Total Assets............................ 2000

No Secured nor Hire Purchase Debts
Unsecured Debts
Description....................Debt......Monthly...APR
Capital One Card 1.............460.......5.........19.9
Capital One Card 2.............998.......20........23.7
M&S Card.......................1952......49........30
Santander Loan.................214.......109.......19
Sainsburys Loan................2784......70........23
Co-Op Loan.....................1275......109.......20
Barclaycard....................3470......78........30
Total unsecured debts..........11153.....440.......-

Monthly Budget Summary
Total monthly income.................... 2,196
Expenses (including HP & secured debts). 1,170
Available for debt repayments........... 1,026
Monthly UNsecured debt repayments....... 440
Amount left after debt repayments....... 586
Personal Balance Sheet Summary
Total assets (things you own)........... 2,000
Total HP & Secured debt................. -0
Total Unsecured debt.................... -11,153 + PDL's @ £2,800
Net Assets.............................. -9,153
Created using the SOA calculator at www.stoozing.com.
Reproduced on Moneysavingexpert with permission, using IE browser.

Compingchris

Hi there and well done for posting. I read a lotion here that people who take out payday loans will struggle to get a mortgage. I think this is because it could look like you're not able to manage your money. That's not a judgement from me, it's just what I've seen.
I don't think you have filled in the SOA fully. You don't have anything in for gas/elec, council tax, insurances, tv lisecne. Once these are in you will gain a better view of what you left at the end of the month.

BigTone

Compingchris wrote: »

Hi there and well done for posting. I read a lotion here that people who take out payday loans will struggle to get a mortgage. I think this is because it could look like you're not able to manage your money. That's not a judgement from me, it's just what I've seen.
I don't think you have filled in the SOA fully. You don't have anything in for gas/elec, council tax, insurances, tv lisecne. Once these are in you will gain a better view of what you left at the end of the month.

Hi, thanks for the reply,
I still live at home 👎, the rent covers all such expenses.

Compingchris

I see that's cool. It sounds like you are going to default on the payday loans, which will mean that you will have little, if any chance of getting a mortgage unfortunately.
I don't mean to sound patronising in any way, but do you think you have a problem handling your finances? Is there a reason why you've gotten into debt again. From your sig it looks like you did a fantastic job first time round. What went wrong? I'd never judge anyone for anything. There may well be valid reasons for the payday loans, there may not? I just think that you don't have a lot of room to manoeuvre in, and tacking the cause (if any) of the problem would be the best way to go.

[Deleted User]

BigTone wrote: »

does this mean that anyone who has taken out a payday loan has done the same?

Pretty much.

A PLD is seen, by most mainstream lenders, as a sign of financial desperation.

I think you will struggle to get credit, from mainstream lenders, until all PDLs have dropped off your files.

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 0
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 2196
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2196
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 550
Management charge (leasehold property).. 0
Council tax............................. 0
Electricity............................. 0
Gas..................................... 0
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 30
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 5
Groceries etc. ......................... 160
Clothing................................ 0 - Never?
Petrol/diesel........................... 350
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0 - Never?
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 25
Haircuts................................ 0 - Never?
Entertainment........................... 50
Holiday................................. 0
Emergency fund.......................... 0 - You need something in here.

Total monthly expenses.................. 1170

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 2000 - own car due to reluctantly sell as I have a company car
Other assets............................ 0
Total Assets............................ 2000

No Secured nor Hire Purchase Debts
Unsecured Debts
Description....................Debt......Monthly...APR
Capital One Card 1.............460.......5.........19.9
Capital One Card 2.............998.......20........23.7
M&S Card.......................1952......49........30 - Once the PDLs are gone, concentrate on this, as the APR is :eek:
Santander Loan.................214.......109.......19
Sainsburys Loan................2784......70........23
Co-Op Loan.....................1275......109.......20
Barclaycard....................3470......78........30
Total unsecured debts..........11153.....440.......-

Monthly Budget Summary
Total monthly income.................... 2,196
Expenses (including HP & secured debts). 1,170
Available for debt repayments........... 1,026
Monthly UNsecured debt repayments....... 440
Amount left after debt repayments....... 586
Personal Balance Sheet Summary
Total assets (things you own)........... 2,000
Total HP & Secured debt................. -0
Total Unsecured debt.................... -11,153 + PDL's @ £2,800
Net Assets.............................. -9,153
Created using the SOA calculator at www.stoozing.com.
Reproduced on Moneysavingexpert with permission, using IE browser.

You have left off the details of your PDLs.

BigTone

Bedsit_Bob wrote: »

Pretty much.

A PLD is seen, by most mainstream lenders, as a sign of financial desperation.

I think you will struggle to get credit, from mainstream lenders, until all PDLs have dropped off your files.






You have left off the details of your PDLs.

Thanks all for all the advice, just to clarify, are we talking NEVER be able to get a mortgage? Even if I cleaned up my debts and managed to save a decent amount? Say 10k in the next 5 years?

I will review my SOA and repost it.
I would say that I did have a problem managing my money, but I know what I need to do, pay it off and save, just don't really know the best way to approach it, if that makes sense.

A 6 year default on the pdl's would be irrelevant if my chances of feet getting a mortgage are gone wouldn't it?

Cheers

[Deleted User]

BigTone wrote: »

just to clarify, are we talking NEVER be able to get a mortgage?

No, not never, which is why I said:-

I think you will struggle to get credit, from mainstream lenders, until all PDLs have dropped off your files.

Once they have dropped off your credit file, they won't affect you.

According to your SOA, you have nearly £600 pm left over.

Do you actually have this much left, or is there expenditure missing from the SOA?

Are the payments listed for your other (ie. non-PDL) debts the minimums, or are you overpaying some of them?

mum2one

BigTone wrote: »

Thanks for the advice, are you able to expand on the reasoning behind this? does this mean that anyone who has taken out a payday loan has done the same? only one of the 4 appears on my credit report, forgive me but I simply do not know.

1 - Done

2 - SOA Below

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 0
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 2196
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2196
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 550
Management charge (leasehold property).. 0
Council tax............................. 0
Electricity............................. 0
Gas..................................... 0
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 30 - can you look for sim only deal or capped deal (eg Tesco) - you can get some good deals for aroud £10 to £15
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 5
Groceries etc. ......................... 160 this seems high as your paying rent and bills included?
Clothing................................ 0 - you don't spend anything on clothes?
Petrol/diesel........................... 350
Road tax................................ 0 -is this a company car? just asking as theres no other details in
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0 - no dentist, prescriptons etc even over the counter items
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 25
Haircuts................................ 0 -nothing on this
Entertainment........................... 50
Holiday................................. 0
Emergency fund.......................... 0 should have something even if it is £20 a month
Total monthly expenses.................. 1170

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 2000 - own car due to reluctantly sell as I have a company car
Other assets............................ 0
Total Assets............................ 2000

No Secured nor Hire Purchase Debts
Unsecured Debts
Description....................Debt......Monthly...APR
Capital One Card 1.............460.......5.........19.9
Capital One Card 2.............998.......20........23.7
M&S Card.......................1952......49........30
Santander Loan.................214.......109.......19
Sainsburys Loan................2784......70........23
Co-Op Loan.....................1275......109.......20
Barclaycard....................3470......78........30
Total unsecured debts..........11153.....440.......-

Monthly Budget Summary
Total monthly income.................... 2,196
Expenses (including HP & secured debts). 1,170
Available for debt repayments........... 1,026
Monthly UNsecured debt repayments....... 440
Amount left after debt repayments....... 586
Personal Balance Sheet Summary
Total assets (things you own)........... 2,000
Total HP & Secured debt................. -0
Total Unsecured debt.................... -11,153 + PDL's @ £2,800
Net Assets.............................. -9,153
Created using the SOA calculator at www.stoozing.com.
Reproduced on Moneysavingexpert with permission, using IE browser.

I noticed you dont seem to have any mention to the payday loans, I really think that your going have to seek some proper help with these loans, if it was one then fair enough but there is more.

There are Payplan and CCCS - I know you want a mortgage but the payday loans will hinder things for the moment unless you live rent free is the only way your get square asap. x

BigTone

Bedsit_Bob wrote: »

I fear you may have already seriously hampered your mortgage chances, when you took out the PDLs.

Apologies, I mis-understood the above

I do have a considerable amount left, I could probably clear the pdls by May this year, the interest I would have paid over this period would be extortionate as I would have to defer all but one, each month until then.

If I contact them with aview to entering into a repayment plan, how would this affect my chances to be looking at a mortgage in day three years time?