Urgent Advice - Loans/Credit cards now no job please help!

tightfistedmoneysaver123

Hi Everyone,

Please can anyone advise/help me on the following...

I have approximately £ 15k spread across 6 credit cards (with min payment on each one being between £50 - £90) and a Tesco personal loan which is approx £ 130 per month and ends in 2010.

The cards and loan were taken out 3-4 years ago when I was working full time, living with my ex-partner and on a good salary of £25k.

Now I am a single parent (baby boy 12 months) and was made redundant in December last year.

I am now currently behind with all my credit card payments (3 months) but have managed to keep up my loan payments.

I have a mortgage £ 125k (£ 650.00 per month) and at the moment I am claiming from a mortgage payment protection insurance which pays £ 500.00 per month and should do for the next 6 months.
Also obviously have C.Tax/Gas/Elec/TV Licence/Insur etc & Food...if you can count living on baked potatos with baked beans for breakfast, dinner and tea I am in a 'major minus money situation' and am sick with worry.

My only other 'income' now is made up of:

Income support (Approx) £ 236.50 p/m
Child Tax credit (Approx) £ 189.20 p/m and
Child benefit (Approx) £ 73.00 p/m

Total Income (approx £ 500.00) + the motgage payment insurance

I am at the stage now where the credit card companies are chasing me for arrears and minimum payments, but as yet have not quite gone as far as default notices.

I have written and explained the situation to each one (last month) and each one has sent me a 'Financial statement' form to completion.

Two of the 6 C Cards have payment protection insurance on them which I have now claimed.

My question is, where do I stand with regard to making a reduced payment proposal to each creditor when my income comes to less than what goes out. Do I have any extra 'rights' as a lone parent on benefits?

I would like all the interest to be 'frozen' can it? and how does a situation like this, if you keep in contact etc and agree on terms etc...affect your credit rating.

I have not used any of my credit cards for over a year, I cut them all up.
I wish that I had never ever had one as now they are taking over my life and are ruining it. Why couldn't I have learned to live as my parents did...if they didn't have the money...they didn't have it.

My capital one card which has payment protection insurance has 'stumped' me...they wrote me a letter to say I cannot claim on my protection insurance until my three months payments (£275.00) are paid to them immediately????
I rang them and explained that if I had that amount of money I would not be in arrears.

Trying to sort this out during the day with a baby that naps for an hour if i'm lucky is a nightmare in itself (HENCE THE TIME OF THIS POSTING)

WHAT SHOULD I DO ???
Please advise as I rang the CCCS yesterday and they weren't sure if Cap1 had the right do demand the arrears before the insurance could be honoured !!??

Any advice would be very much appreciated - Thank you

tightfisted moneysaver123

nethy

go and see your local citizens advice bx, they are fantastic at informing you of your options

tightfistedmoneysaver123

Thanks for your advice Nethy, does anyone else have any further suggestions?

smudgemanc26

I agree with the OP the CAB will be able to help you work out a financial statement and can contact your creditors on you behalf then a payment arrangement can be worked out, i went to mine and they were very helpful and it was less stressful than i thought. All payment plans have been accepted so i dont get the hassle i used to off the credit card companies.

smudgemanc26

ps there is a site called what entiltled to which might help you to see if you are getting all benefits you are entitled to.

Is there anything you can ebay to make extra money?

If you want post up your SOA (statement of affairs) see SS sticky at the top of this board and other experienced DFW's can see if you can save anything on your outgoings.

poppy10_2

http://www.entitledto.co.uk/

chevalier

Out of interest I didn't notice any CSA payments for your baby, is your OH not paying?

Also as you are a single parent, I believe you can get extra help towards childcare costs for the first few months if you return to work. Would you be able to yet? Whilst this won't help your debts at the moment, I would imagine that you could get a job which would help pay your debts off quicker.

If you need to retrain, then you can get free training whilst unemployed and many council run ones have a creche so you don't have to find child care to attend.

Best of luck
chev

Shineyhappy

Hi,

Apart from the other suggestions, have you considered getting a lodger, selling unwanted things on Ebay? There are challenge threads that might be of interest which recommend ways of getting some extra cash.

Could you change your mortgage payment to interest only until your are back on your feet?

Do you know anyone who could babysit whilst you work as I think working tax credits are very generous. I think you only need to work 16 hours a week, but if you go to the CAB they will know loads about that sort of thing.

Best of luck sorting things out and keep posting on here so we know how you are getting on!

tightfistedmoneysaver123

Thanks everyone so far for your very much valued advice.

I have today made an appointment to see a debt specialist within the Citizens advice bureau for the 1st August and I also rang the National Debt Helpline for basic advice as today I received a Default Notice from one of my c cards - so that really opened my eyes!

I found out that as my mortgage is interest free and I am on income support, I can claim via the department of work and pensions to get the first 100k of my mortgage paid. It's called 'ISMI'. They advised me to put my claim in now because it usually takes 39 weeks/9 months to qualify?

Also as 2 of my c cards are with Mint and Tesco and my personal loan is with Tesco personal finance I was advised to open a new 'BASIC' bank account elsewhere as I bank with Natwest. Apparently as they are all part of the same 'group' any one of them take money directly out of my bank account without my permission to pay themselves?? Has any one ever had this happen to them or heard of it happening?
Consequently they also advised me to cancel my o/draft, move all my d/debits and leave my account at zero?? I said I didn't really want to do this as I had a good relationship/loyalty to Natwest and they advised me that my loyalty would be out of the window because I owe them money!

Other thing I did not like the sound of was that even though I have maintained my loan payments, I have to put all my debts down together as I cannot choose who to pay and so I have to let them down too as if I don't 'I won't be doing myself any favours'.

As far as maintenance goes, my ex-OH buys Milk, nappies, clothes and shoes etc for Baby when I ask and so far this is acceptable to me.

I have sold unwanted stuff on e-bay and all the proceeds went straight to c cards and the loan.

As far as working goes, I do intend to at some point, when my son is a little older, it's only if I do right now, the private insurance which covers my mortgage payment would not be paid as I would actually be 'worse' off.

I am going to check out the 'entitled' to website to see what that has to say.

It's so hard with a dependant child, This wasn't what I planned as my route in life.

Anyfurther advice or feedback would still be very welcome.

Many Thanks

Amarillo

I would think very carefully about having an informal financial arrangement with your ex. He might be happy to pay when you request money from him now but what would happen if he was to have a new partner and have further children in the future ? Or if you have a new partner in the future he might decide he doesn't want to pay anything anymore. I've seen a number of friends have problems of varying sorts over the years with maintenance and I really would urge you to put this on a formal footing now.

tightfistedmoneysaver123

Thanks Amarillo, I will certainly give this some thought.