One incident / agreement / situation that set the debt spiralling?

learning_to_drive

Debt is a funny thing, the LBM is the best thing that ever happened to me, but it makes you think, what actually set the spiral off? What one incident / agreement / event made you slump into debt and not have enough money for a pot to p!ss in let alone meeting min payments and what not?

The one agreement that did it for me was the Car on HP, I dont know what possessed me, I was giddy at the time and needed a car for work, so got one on HP thinking I could afford it, then I realised I had to pay £400 for my ins deposit, terrible times, I put that on my dads credit card, before trying to get out of the car agreement, I had to take another car, 27% apr, and it went from there, I lost my job, became very depressed and it all went rapidly downhill.

Thats not to say I wasnt in debt beforehand, but that was always my choice due to overdrafts and what not, but the car agreement is something that I am always saddled with until I pay the loan off! Its good having reminders like £103 for a car I dont have anymore, Ill certainly think twice!

Would be interesting to hear other viewpoints on where it "went wrong for them" could be a job loss like mine and then just stuff piling up!

Also, anyone who has done something of an "antidote" to make the situation better, could be a new job, savings, lotto win, ebay, amazon, payrise, sale of car or other hard decisions, second job, no social life, £10 challenge, Matched betting etc!

zipzap

I have to say that ours was having kids - I had PND after my first and just forgot about bills, inccured charges, forgot about reminders, inccured more charges and it all went downhill from there!

We were never very well off before then, I was an actress and dh was an apprentice so that's not an ideal recipe for success!

We are getting ourselves on track since I started my own business and it's going from strength to strength! I just wish the tax man and vat man would naff off!!

ZZ

boadicea_2

Hi,

My mum getting ill did it for me. Apart from all the extra costs that come from partially suporting another adult, I had to put off buying my first place for a few years... and we all know what happened to house prices in the meantime!

Having said that, she's still here and no amount of money is too much to pay for that privilige. She's one in a million!!

rog2

For me, it was, really, a combination of factors - trying to keep a failing business going, running up credit and all the usual stuff, but the straw that broke the camel's back, in my case, was the HP agreement, with Black Horse Finance - when I asked them for help they told me that my agreement was 'unregulated' and set about a campaign of harassment, until I was paying them before any other creditor (including my family). This went on for about 8 months - when the cash finally ran out, they, unceremoniously, repossessed the car, and chased me, through the courts for the 'shortfall'.
I hasten to add that this happened before I found DFW.

nickm122

mine came from meeting my wife. Just after we met, I moved away and it was beginning to get hard travelling to see her every weekend so we decided that she moved up north and we rent a house together. We were just about surviving but then we decided to have a child and with that I thought I needed a bigger car so traded my old HP car in and took out a whole new one!!!

Two years down the line, we've moved again (military so have no choice), aquired £16000 worth of debt together on CC's, Loans and HP's but I am now earning enough to start paying it off for both of us starting with my wife's CC's (they have the higher interest).

I've set myself a budget of £100 a week for spending which includes petrol and family shopping. This leaves me with saving £15 a week to go towards MOT's and things like that plus I think I could survive off £90 a week which means an extra £10 a week could go on debt!!

Bring it on!!!

blackangeluk

Hand on heart I think mine spiralled out of control about 10 years ago when I bought my first home Parents were leaving the area and my choice was move out or go with them, I chose the first option. At the time I was not in a fantastically paid job and had a £10k loan already at £331 per month (remember it to the penny). Instead of renting, I bought a house for £30k (remember those days ), my then bosses took over my loan (small company - lovely people) and I repaid them £100 per month. Bless them, they even lent me my deposit I was that skint!

I was therefore 21, mortgage, big loan, and then I was crippled. In hindsight I should have rented or gone with my parents, paid the loan off and been sensible but I didn't. I can honestly say for the last 10 years I have robbed Peter to pay Paul - how sad is that. OH moved in shortly after I bought the house and helped out but it was never enough. When our daughter was born I had to find a more accomodating job which meant leaving kind employers and repaying the loan and I slipped down the spiral even more I remember counting money from the whiskey jar to buy food when she was 6 weeks old.

We have gone in 10 years from having my sole income of £11k to having a joint income of approx £75k - but I am paying massively for the mistakes I made when I was younger. For me the house meant I could consolidate and I did it many times until the money finally ran out. Only last night I added up our income and what our expenditure would be "if" I had been sensible - gutting feeling!

But to be honest, no one told me not to do it and that it was a silly thing to do, and I'm not sure I would have listened even if they had...............

Seaxwyn

Mine was not saving for tax - combined with having a baby and moving house.

In 2000 I earned £35k freelancing. In 2001 I took three months off work when my DS was born (self-employed so earned nothing all that time) and moved house, with all the costs that involved. In January 2002, I got a tax bill for £7k and had no money to pay it with, so took out the first of a series of loans.

In 2005 we built an extension on the house. Yes, I know..... madness.

But it was that 2002 tax bill that started me on the debt road and the crazy thing is I still don't save for tax.

learning_to_drive

in my case, was the HP agreement, with Black Horse Finance - when I asked them for help they told me that my agreement was 'unregulated'

I was told that, I said I am struggling to make payments,

'oh, well, you havent had the agreement for 6 months, i explained about the depression and what not'

'right well, we can put you on half payments for 3 months, however, we would charge a late fee (£35) and also it would go on your credit rating as missed payments'

'right, so, im no better off really because you are still charging me £90 a month even on reduced payments'

'yes, but we dont add the £35 till the end of the agreement'

I hung up, luckily folks got me a loan in their name which I now owe them the matter of £5k!

rog2

learning_to_drive wrote: »

I was told that, I said I am struggling to make payments,

'oh, well, you havent had the agreement for 6 months, i explained about the depression and what not'

'right well, we can put you on half payments for 3 months, however, we would charge a late fee (£35) and also it would go on your credit rating as missed payments'

'right, so, im no better off really because you are still charging me £90 a month even on reduced payments'

'yes, but we dont add the £35 till the end of the agreement'

I hung up, luckily folks got me a loan in their name which I now owe them the matter of £5k!

Sounds like you spoke to the same person as me.:mad:

iwanttoberich

For me, it was both tax credits and housing benefits stopped at the same time. My income was literally cut in half. Despite my telling the tax credits office their calculations were wrong, they still insisted I was receiving the correct amount of money. One year later they realised their mistake. As for housing benefits office, they failed to use the information I provided them and overpayed me. In fairness to them, they did write off £900 of it. So I ended up living off my credit cards.

It has been almost three years, and I still cannot afford any extras like a new pair of shoes and I am still wearing the same clothes from back then, but I have managed to work out payment plans with everyone I owe and all payments fit into my salary. CCCS and Payplan could not help me because I did not have £100 to spare. CCCS suggested bankruptcy. My daughter convinced me not to go that route.

My car tax is due next month, so I have to do my MOT (which is long overdue) this month. That means I will have no money afterwards. I tell myself that at least the collectors won't be calling. :j

machsmum

For us it was a combination of giving up work after having child no.1 and then losing a baby 7 months after she was born. Became seriously depresssed, altho did super job of keeping it from everyone, until had baby no. 2 that is. And for me retail therapy was my method of coping. I know people joke about it but I had major problems with guilt about not bonding with DD and also losing baby. Guess I thought i could buy us happiness. I didn't work, of course, and only now, as baby 2 (DS) has turned one and DD nearly 4 are we trying to get ourselves sorted.