Help needed - Not sleeping now cos I am so worried!

westhamsam11

Hi - I am using my husbands user name - He has said I should post on here to see if I can sort out my debt!

Basically I have a loan over 10 years with 9 years left on it that costs me £165 per month and I have 2 credit cards that are up to over £8000 between them and I have a Next account that is over £1200. I earn £800 per month take home pay and my wages just cover my repayments and then I survive on my cards all month. I know I am digging myself deeper and deeper into debt but I can see no way out. The way we work things is my husband pays all the bills and the mortgage and I pay for the council tax and all the food shopping. Most of the time I deal with family birthdays, clothes for the kids, school dinner money etc I used to spend quite a bit on clothes for myself and my husband but this all stopped a long while ago when I realised how bad things were getting. I have previously merged debt (about 3 years ago and it was about £3000) into our mortgage when we changed mortgage companies and promised I would not get another credit card, loan etc And then I thought well if I get one and dont go silly and now I am back to square one again but this time the debt is out of control.

My husband thinks maybe I should see someone about an IVA but I am worried as I know very little about what it entails and I can not believe companys can do this for nothing - surely they have to earn a living somewhere???

Any ideas would be much appreciated - Thanks in advance.

Magentasue

I think you should:

1) Phone one of the companies in the blue banner at the top of this thread ASAP - check out their websites for info.

2) Work out a budget of how much you have to pay each month for your council tax and food (check out Moneysaving Old Style for ideas on how to cut back on this) and subtract this from your £800 take home pay.

3) Allocate the rest to your creditors. Send them their reduced payment with a letter explaining your difficulties and asking them to give you space (reduced payments and interest) to sort things out.

4) Cut up your cards, use cash only for shopping.

When you get things sorted out with one of the helplines,they will help you to negotiate with your creditors or consider other options like an IVA or bankruptcy. In the meantime, keep everyone informed and ditch the credit.

Once you've made a start, congratulate yourself on how you're on the way to sorting things out. Good luck!

HTH

Malestrom

What are the interest rates on your loan, credit cards and Next account?

westhamsam11

Malestrom wrote:

What are the interest rates on your loan, credit cards and Next account?

I know this sounds so flippin stupid but I have no idea of rates on any of them - Now you can see how I got into this mess cant you? I do have all the paperwork here for them so it shouldnt be too hard to find out the rates.

Malestrom

Post back with the APR's and we'll see if we can suggest something. Have you missed any payments on anything yet, or made any late payments? Do you have any CCJ's?

squeaky

Then you really need help to help yourself relax.

You've made a good step because you're taking charge right now and getting things in hand and that's got to feel good.

Make yourself a list of the things you've done for more feel good factor.

Then make a list of the things you know about, have under control now, but have yet to be done.

The thing is that if you keep a list in your head you tend to go back on things and count them again and often end up going round in circles. Writing down a list helps in different ways...

YOU write the list so YOU are in charge of it. Even though you haven't done the jobs just yet you are in control.

And you will also be pleased to see that the list is way shorter than the one in your head! That helps to relax no end.

It helps if you get your list of tomorrows things to do at least an hour before bed time so that your take charge effort has time to sink in to your poor battered brain so it's sure you're in control.

Try and avoid, then, thinking about the list as you try to sleep. Don't tell yourself off! Just stop thinking about it and think about something else.

Hope that helps.

ADAM001

take all your debt details to your local CAB,get some advice.

westhamsam11

Malestrom wrote:

What are the interest rates on your loan, credit cards and Next account?

Next - Balance owing - £1510.00 (24.99% APR)

M&S - Balance owing - £4816.00 (15.9% APR)

Capital One - Balance owing - £4554.07 (14.9% APR)

Northern Rock Loan - started Sept 2004 £14,000 over 10 years at 7.5% APR

Now I have sat and typed all this out its even more scarier than I thought.

Magentasue

I've just typed out a reply and deleted it because it was all over the place because I'm not clear on whether you can afford to repay these debts and how you feel about IVAs and bankrutcy. A couple of questions:

1) What are the minimum payments
2) How much is your monthly council tax payment
3) How much for food etc and how many of you are there

westhamsam11

Magentasue wrote:

I've just typed out a reply and deleted it because it was all over the place because I'm not clear on whether you can afford to repay these debts and how you feel about IVAs and bankrutcy. A couple of questions:

1) What are the minimum payments
2) How much is your monthly council tax payment
3) How much for food etc and how many of you are there

Minimum payments are - roughly £150 each debt and then £164 for my loan. My council tax is £100 per month and I do overspend on food etc - There is my husband, myself and 2 kids - I probably spend in the region of £500 per month on foodand then extra for birthdays, bits for the kids etc I know this can be cut back on and have started already on the birthday side of things and the food bills. I know nothing about IVA or bankruptcy - would these affect our mortgage? Although the mortgage is in both of our names it is my husband who makes the payments. I also pay into 2 christmas clubs - one is £40 per month and the other is £50 per month - In reality I suppose I could drop these if needed.

Magentasue

westhamsam11 wrote:

Minimum payments are - roughly £150 each debt and then £164 for my loan. My council tax is £100 per month and I do overspend on food etc - There is my husband, myself and 2 kids - I probably spend in the region of £500 per month on foodand then extra for birthdays, bits for the kids etc I know this can be cut back on and have started already on the birthday side of things and the food bills. I know nothing about IVA or bankruptcy - would these affect our mortgage? Although the mortgage is in both of our names it is my husband who makes the payments. I also pay into 2 christmas clubs - one is £40 per month and the other is £50 per month - In reality I suppose I could drop these if needed.

I don't think this is what you want to hear (because I wouldn't want someone saying it to me:cool:) but I think you should:

1) Drop the Christmas clubs - you have to live on less or you'll never get out of this mess
2) Allow £100 a month for food etc - check out Moneysaving Old Style and look at the grocery challenges. Like I said before - don't use credit
3)Apply for 0% credit card and transfer the Next debt and as much of the M&S as you can. Click on credit cards in the yellow box on the left and find the best 0% balance transfer card

Earlier I suggested contacting your creditors and asking for space, you wouldn't want to do that AND apply for a 0% card.

I don't know about bankruptcy and IVAs but there is loads of info on this site in other posts and in the Where to Start with debt article. My feeling is that you spend too much on a lifestyle you can't afford and until you stop shopping you'll dig yourself deeper. 0% cards etc will only work if you don't use any more credit.

Another thought, there's £25,000 of debt there - do you have anything bought with it that you could sell and downsize?

I hope I'm not making you feel worse - I know it's a horrible situation to be in. I was lucky in that my earnings increased so that I can repay my debt quicker. You may be better off bankrupt, I don't know - docontact one of the free helplines.