any advice please?

mhendel86

Hi,
I wonder if anyone can offer any advice please?
My wife and I have approx 17k debt on poor credit rating credit cards.
We are just about managing and making the minimum payments [total £600/month]...but the overall balances never seem to drop and I can't see it ever ending.
Is there a solution or advice out there that can help for both the monthly situation and get rid of the debt sooner?
Thanks in advance,
Matt

Firewalker

It seems your problem is that you don't earn enough to be able to make larger payments. Seems to me, the solution is to think of ways to make more money (which contrary to what you may hear is not that hard).

Firewalker

andyfromotley

I am assuming that transferring the debt to 0% cards is a non starter?

How was the debt accumulated? If it was just general over spending then have you addressed this? This needs to be your first step.

After that you need to do everything you can to cut your living costs to the bone, throw the cash saved at the debt.

As fire walker said you also need to increase your income. New job, promotion, overtime, second job, third job!!! Income is king for you! Again throw every penny extra you earn at the debt.

The debt you have is substantial and no doubt it was built up over time, it isn't going to disappear overnight. You need to get set for a long haul which is no bad thing as it will allow your new habits to become ingrained in your lifestyle.

Start by posting an SOA on here and we will have a look at your finances and suggest help, use this link.http://www.stoozing.com/calculator/soa.php

sourcrates

Increasing your income is not possible for everyone, I am assuming your debts are still with the original creditors, if you cease payment, allow the accounts to default, and be sold on to DCA's the totals will be frozen, no more interest will be added, and you can then agree affordable repayments and clear your debts.
There will also be discounts offered for early settlement, usually around 30% or more, saving £600 a month for 6 months soon adds up.

redpete

Three options: earn more, spend less, default on repayments.

Without more information (most of which would come from an SOA if you filled one in) it's difficult to offer any advice.

andyfromotley

sourcrates wrote: »

Increasing your income is not possible for everyone, I am assuming your debts are still with the original creditors, if you cease payment, allow the accounts to default, and be sold on to DCA's the totals will be frozen, no more interest will be added, and you can then agree affordable repayments and clear your debts.
There will also be discounts offered for early settlement, usually around 30% or more, saving £600 a month for 6 months soon adds up.

Hi sour,

But it is possible for nearly everyone to increase their income. Often quite substantially.

Again i'm not sure i agree with your advice on this one. Their debt is currently affordable. If they are able to cut back and earn more, then they could really start to make some headway into this debt.
Just deliberately letting debts default (which they CAN afford to service) feels kinda wrong to me. As i have said many times i have no problem with debt releif for those in deperate need but i feel that those who can pay back their debts should do so.

An SOA would help shed some light on the OP's situation.

sugarcube84

andyfromotley wrote: »

Hi sour,

But it is possible for nearly everyone to increase their income. Often quite substantially.

Again i'm not sure i agree with your advice on this one. Their debt is currently affordable. If they are able to cut back and earn more, then they could really start to make some headway into this debt.
Just deliberately letting debts default (which they CAN afford to service) feels kinda wrong to me. As i have said many times i have no problem with debt releif for those in deperate need but i feel that those who can pay back their debts should do so.

An SOA would help shed some light on the OP's situation.

I agree even if you can't do the big things like promotion/new job/second job there are small things you can do. Through surveys and cashback I earn enough to cover the bday and xmas presents so not a small amount!

sourcrates

andyfromotley wrote: »

Hi sour,

But it is possible for nearly everyone to increase their income. Often quite substantially.

Again i'm not sure i agree with your advice on this one. Their debt is currently affordable. If they are able to cut back and earn more, then they could really start to make some headway into this debt.
Just deliberately letting debts default (which they CAN afford to service) feels kinda wrong to me. As i have said many times i have no problem with debt releif for those in deperate need but i feel that those who can pay back their debts should do so.

An SOA would help shed some light on the OP's situation.

OP was asking for options, this is one option open to him.


OP also states he's "only managing the minimums" so maybe the debt is not that affordable ?


Agree an SOA is the way forward, but don't always assume that everyone can increase there income magically, depends on a number of factors, plus OP`s own circumstances.

mhendel86

Thanks to all for the comments and recommendations.

The debt has built up [over 3 years] for a number of reasons - mainly being on one income and a new baby had a lot to do with it, so not entirely built up from a lavish lifestyle, but through necessity.

All of the comments seem to suggest that it best to manage this by cutting back [more so than now] and making larger than the minimum payment each month - I guess concentrating on one at a time? Which will make dents into it.

My salary is decent and my wife has recently started part time weekend work - which will help.

I guess that the thing to take away is that we are not relying on the credit cards each month to survive...just need the plan to pay them off.

I will look into the SOA, to see what it shows.

Thanks for you help.

National_Debtline

mhendel86 wrote: »

Hi,
I wonder if anyone can offer any advice please?
My wife and I have approx 17k debt on poor credit rating credit cards.
We are just about managing and making the minimum payments [total £600/month]...but the overall balances never seem to drop and I can't see it ever ending.
Is there a solution or advice out there that can help for both the monthly situation and get rid of the debt sooner?
Thanks in advance,
Matt

Hi Matt and welcome to the forum.


As others have said, there may be a whole range of options for you but without knowing more about your situation, we can only speculate. Why not take a few minutes to fill out a Statement of Affairs at


http://www.stoozing.com/calculator/soa.php


and then post it here, so we can keep any advice we give you as relevant as possible. As a debt adviser your predicament of creeping credit card bills is one I see all the time, so be assured that there are solutions available.


EDIT - cross-posted with OP.


Dennis
@natdebtline

mhendel86

Hi all, I have taken your advice and filled out the SOA tool as accurately as possible - copy below.

Thank you all for your time and hopefully I can take some of your following advice into practice to help my family.

Thanks,
Matt

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 1
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 2200
Partners monthly income after tax....... 0
Benefits................................ 82
Other income............................ 0
Total monthly income.................... 2282

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 539.43
Management charge (leasehold property).. 0
Council tax............................. 116
Electricity............................. 35
Gas..................................... 24
Oil..................................... 0
Water rates............................. 10
Telephone (land line)................... 0
Mobile phone............................ 82.42
TV Licence.............................. 12.12
Satellite/Cable TV...................... 41.99
Internet Services....................... 0
Groceries etc. ......................... 200
Clothing................................ 0
Petrol/diesel........................... 100
Road tax................................ 0
Car Insurance........................... 30.41
Car maintenance (including MOT)......... 10.18
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 10.4
Pet insurance/vet bills................. 92.36
Buildings insurance..................... 0
Contents insurance...................... 10
Life assurance ......................... 0
Other insurance......................... 13.98
Presents (birthday, christmas etc)...... 15
Haircuts................................ 0
Entertainment........................... 100
Holiday................................. 0
Emergency fund.......................... 0
Pay back mum & dad...................... 230
Lottery................................. 16
Total monthly expenses.................. 1689.29


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 2000
Other assets............................ 0
Total Assets............................ 2000

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
Matt Capital One...............1723.91...63........30.34
Matt Vanquis...................2986.77...164.......40
Matt Barclaycard...............7548.15...195.......18.9
Next...........................1008.32...54........24.99
Gem Barclaycard................2202.91...68.21.....29.9
Gem Capital One................1041.65...38.18.....30.34
Total unsecured debts..........16511.71..582.39....-


Monthly Budget Summary
Total monthly income.................... 2,282
Expenses (including HP & secured debts). 1,689.29
Available for debt repayments........... 592.71
Monthly UNsecured debt repayments....... 582.39
Amount left after debt repayments....... 10.32

Personal Balance Sheet Summary
Total assets (things you own)........... 2,000
Total HP & Secured debt................. -0
Total Unsecured debt.................... -16,511.71
Net Assets.............................. -14,511.71

Created using the SOA calculator
Reproduced on Moneysavingexpert with permission, using other browser.