I want to stop drowning

Silver_Queen

Hi Debtaghh.

I think that the very first step that you need to take is to be honest about the amount of debt that you have. Including everything. I think that it's hard for you to keep track and hard for anyone to give you advice without the proper info at hand.

I am also a lover of holidays and I know how tempting it is to book it, especially when you have lots of debt and another few hundred doesn't seem to hurt.

I think that you are stuck in a back and forth of getting a huge burst of motivation, going hell for leather, and then running out of steam and slipping back into spending money because it doesn't seem to make a difference anyway. I know what that's like. I've experienced it a lot too, both with money and with weight loss - I always feel like those two things are the same!

It's completely, absolutely your choice whether you post this info, but if you don't post it, there's not much that anyone can do on here to help.

I always tell my clients this at work - tell me the raw, ugly truth and I will not be shocked. I'll have seen worse and I will help figure a way out of it. If I don't know the whole story, I can't help and may even give the wrong advice.

I know you don't want to do a DMP. However, you have been saying that you're "hopeful" about things for months and months, if not years. Why not just face the music as it is, see how ugly it is, and work out a way to tackle the situation as it is now?

As always, I'll be cheering you on

debtaghh

Thanks. I do have a spread sheet with all the debt logged separated into sections cc and family.

Spendy_Spenderson

debtaghh wrote: »

Hi,

After speaking to DH we will stick to our original plan of reevaluating our situation come June time. If things haven't improved then we will do a dmp. I will try and be good with money etc and see what happens. My Dh is having some changes at work which means he could end up with no overtime or loads of overtime so we will also see what happens with this as this will have a huge impact on our situation.

Hi Debtagh,


Just wanted to remind you of the plan you put in place early this year when the possibility of a DMP again reared it's head. I really think it is important to honestly evaluate where you are now compared to 6 months ago. Has the overall debt reduced, stayed the same or increased?


I know you juggle lots of payments, both to the cc's and to family and so it can be easy to loose oversight on the overall picture. It's important to realise this because if the trend is that it's increasing then I would suggest that will continue to be the case and so you need to take drastic action now. With even the best placed intentions it is near impossible to reduce the overall debt whilst facing a monthly shortfall of 500 pounds. And that's the shortfall if the second job actually comes together and works out, so truly the shortfall is closer to -700 pounds.


I don't want to see you forced down a route from spiraling interest rates and the shortfall steadily increasing. I know I probably sound like a broken record by now and have maybe taken a blunt approach in the past but I've always tried to advocate a DMP for your situation as truly feel it will give you the break you need. But ultimately it has to be your decision. Just please read back and remember what you promised yourself about seeing whether the situation has actually improved by June and if not, then taking decisive action.


Good luck as always.

BabyStepper

wishingthemortgaheaway wrote: »

If you put all of your personal debt onto a dmp, paying a token £1 a month.
1) where would that leave your shortfall?
2) how much per month could you repay to family?
3) how long would it take to pay the family debt?

This is roughly how it would look - all you good people who know about dmps and how much you are allowed for things can adjust it so debtaghh can get a look at how things could be.

Rent £1300
Council tax £216
Gas and electricity £100
Water £50
Mobiles £62 ( 3 mobiles all in contract)
Sky tv £35( Includes phone line, internet and tv)
House alarm £27
Pre payment prescriptions £20.50 ( me and my husband both go through several prescriptions a month so this is cheapest option)
School donation £2
Food shopping £350 ( family of 5 but trying to cut down)
Fuel £180
Entertainment £100 ( includes any hair cuts needed and did swimminv lessins and football )
Holiday £100
Xmas/bdays £100 ( I know this is too high and the holiday)
Car £50
Emergency fund £50
Tv licence/ contents insurance £20
Clothes/shoes £30 ( including new sch uniform/bag)
Car insurance. £30
Car insurance 2 £25
Dad cc £50 ( 0% until 2020)
Mbna £1
Barclaycard. £1
Tesco. £1
Nuba. £1
Halifax. £1
Dh Tesco £1
Dh Barclaycard. £1
Tesco £1
Dad cc 2. £40

Total outgoings. £2,945.50

Dh basic £2505
Child benefit £197
My income £430
2nd job income (fingers crossed) £210

Total income. £3342

Monthly leftover after debt repayment = £396.50

enthusiasticsaver

I don't think a managed DMP would allow the payments to family debt to take precedence over the credit cards/loans etc. I also think the holidays/presents/entertainment would be reduced from £100 to each to maybe around half that but maybe those who have DMPs. Might know better.

A self managed one might be better but whether the lenders agree to it is another matter. However what can they do? OP has no assets so little point in lenders taking them to court so I think they would agree to a sensible soa and freezing the interest allows all the repayments to go towards the debt at an affordable level. Failing an increase in income I cannot see another way forward.

Spendy_Spenderson

I am no expert on the amounts they deem appropriate for the different categories on a dmp but if it was me, I'd definitely separate out and distinguish the categories as much as possible. For example, under 'entertainment' you have hair cuts, which really is an independent need and should be listed as so. Same with the children's school clubs etc. So the SOA could start to look more like:


Haircuts: £30
After school / sports clubs: £30
Entertainment (true entertainment): £70
Clothes: £50


So where £100 for bundled 'entertainment' might be deemed high, if you actually breakdown the needs into more categories with realistic amounts attached, then they start to look more realistic and overall provide you with more of a budget for each area. I for one don't perceive any of the above categories or amounts excessive for a family of 5. They need to be manageable and realistic to prevent any relapse onto credit. I think you can allocate enough to each category to enable you to budget and perhaps allows some extra to go towards the family debt which is not able to be a category on it's own. Also if you took a 6 month payment break before the dmp started, that would allow you to build up a small emergency fund but more importantly pay off a chunk of the family debt during that period with the hundreds you'd be saving in cc payments and interest. Meaning that once the dmp started the family debt should be significantly less and will cause you much less stress and worry.

debtaghh

Thanks everyone, I appreciate all of your comments. I'm really thinking about my life , job etc at the minute as something needs to change. I just got a message saying it's been ten years that I've been on here... how I wish I did an IVA then! One of my other worries is if I do a dmp it's like saying we will never be able to buy a house , which I find really hard to accept.

enthusiasticsaver

debtaghh wrote: »

Thanks everyone, I appreciate Kate all your comments. I'm really thinking about my life , job etc at the minute as something needs to change. I just got a message saying it's been ten years that I've been on here... how I wish I did an IVA then! One of my other worries is if I do a dmp it's like saying we will never be able to buy a house , which I find really hard to accept.

A DMP stays on your record for 6 years not for life. Realistically are you going to be in a position to buy a house in the next 6 years especially in the area you live in? Bear in mind you would have to not only get the debt situation under control but also save a deposit and costs.

Whilst I understand you are struggling to accept the reality of your situation there is a danger that you will drift along as you have been never taking control until you are forced to by redundancy, retirement or any other circumstances.


I have to agree with spendy that defaulting and using the next 6 months to save up to sort out the family debt and give you a buffer for then start on an affordable DMP would be your best option. I also think not having access to credit and not borrowing from your family would not be a bad thing considering you have been struggling with this for so long. The issue with this would be you have to accept that you can no longer resort to credit cards for xmas or holidays.

debtaghh

I'm really confused , I thought a dmp was where you pay all your debts back but it can take years and an Iva was a six year thing? We were told we can't do an Iva as we don't have enough disposable income.

[Deleted User]

debtaghh wrote: »

I'm really confused , I thought a dmp was where you pay all your debts back but it can take years and an Iva was a six year thing? We were told we can't do an Iva as we don't have enough disposable income.

Hi Lovely,

From what I grasp is that although a DMP can take several years to clear, the actual defaults will be on your file for 6 years and then they fall off regardless of whether you are still on the DMP or not and they can't be reapplied to your credit file either.

I'm sure someone more knowledgeable will be along soon xx