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haycorns

Hi. I am helping my brother sort out his finances and life following a stroke. He had been living rough in a caravan at his workshop and was ' self employed' buying things mending things and selling things ( mostly the first!) , but the stroke has left him unable to use his hands and earn a living. We have managed to get him into temporary accommodation and onto universal credit of £317 per month. He has a maxed out overdraft of £5000 and a loan of £7000 that he defaulted on some time ago. Interest charges on the overdraft are about £70 per month and £6 fees. we are going to write to the bank and explain financial hardship, but at present he has no hope of making significant payments . He has had the overdraft for about 6 years and never got out of it. interest payments over the last 6 years are about £5000 with about £1500 fees on tp of that. I am going to try and claim the fees back. Not sure what to do about the loan . Any suggestions would be most welcome. I would say he his light bulb has come on but its not shining bright enough yet!

StepChange_Rachael

Hi

Thanks for posting on the forum.

I’m sorry to hear that your son was unwell. I can understand how this would have caused you to struggle with making payments to the creditors. Of course your health and that of your family is a priority.

I wouldn't worry about the debt going to a collection agency, as this is common when a debt has defaulted. The collection agency doesn’t have any additional rights than the original lender and they’ll look to work with you to come to an affordable repayment plan.

There will be some impact on your credit file but credit files usually improve over time. Collection agencies normally stop interest and charges at the point they start collecting for the debt.

There are ways to deal with your creditors going forward to try and stop further action and get a realistic solution in place. I’d suggest contacting a free debt advice service to look at your options. To do this you can use StepChanges online Debt Remedy tool for free and impartial debt advice.

Thanks
Rachael

joeysmum wrote: »

so my son fell ill due to an accident and needed hospitalisation and a period of recovery which sent me into a bit of a spin. Following that I failed to make one on my repayment plan which I had with them, which was charging no interest, then two etc. Now they are adding interest back on to the account and charges.

I have since received numerous letters which remain unopened, but have plucked up the courage to open one that arrived at the weekend. It says that the default has been registered and I now owe the whole outstanding amount of £10k. I can't obviously pay this.

The letter mentions that this may go to a debt collection agency for them to deal with. Will they add charges or will it become a repayment only until the balance is cleared. My state of mind is such that whether the default is registered for 6 years or not, I can't help that. I couldn't afford to keep up the repayments of approx. £250 a month, so I really had no option.

Anyone got any advice? I have other debts on cards, have a reasonably well paid job but have a large family to support.

Thanks.

StepChange_Rachael

Hi

Thanks for posting.

I’m sorry to hear you’re struggling with paying your creditors, I understand it must be causing a lot of stress and worry not knowing the best way forward. There are many different debt solutions available and a Debt Relief Order (DRO) is one type of solution that might be right for you. However, to give accurate debt advice you’d need to speak with an advisor who can take into account your full financial position.

As you’re self-employed I’d suggest contacting the Business Debtline as they can offer tailored advice taking into account for your self-employment. This is because there can be different things to take into account when your self-employed. They’ll be able to provide you with the correct information so you can make the best decision for you.

There will certainly be a way forward so please be assured there is help available.


Take care,
Rachael

Neiltiger wrote: »

I’m in debt by a total of around 12000 which doesn’t sound too much but I have absolutely no money spare at the end of the month!!! I’m self employed taxi driver and would like to appl for a dro. I have a car on hp which I use for work and also have another car to the value of 1500 which my wife owns. This would be a single application by myself as these debts are mine. I suffer with anxiety and it’s really getting me down and don’t know where to turn. I have money from my wife going into my accounts aswell as my money and it’s up the wall I would know where to start all I know is I’m broke it’s nearly Xmas and I’m lost please can someone help

StepChange_Rachael

Hi

Yes, don't worry that makes sense.

Once you send back all of the application pack we’ll start contacting your creditors to arrange the DMP. We won’t take a payment until you’re happy with the payment date. If you’ve concerns about the payment date I’d suggest contacting the team that’s setting up the plan to discuss this with them so we can arrange a time that’s suitable for you.

Alternatively you can hold off from sending the pack back and make a token payment to the creditors or ask for a complete hold on the accounts in the meantime. Either way, the important thing is to make sure the creditors are aware so they’ll know what to expect going forward and why there are missed or reduced payments. This will help to try and prevent them from taking any further action before the plan is in place.

Thanks
Rachael

Changingtimes wrote: »

Hi SC Kirsty.
Thanks for your feedback.
As my regular payday is 17th of the month the 1st Jan would be impossible.
Am I best to send papers back and advise of this or wait until that time and try myself to keep creditors at bay?
IF I sent back would work start in the DMP prior to payment etc what I mean by that is would SC write to creditors with offers before I have even paid ?
Hope I am making sense
Thanks.

StepChange_Rachael

Hi

Thanks for posting.

I’m sorry to hear of your brother’s Ill health but glad to hear he’s got support to find a way forward.

There are certainly options available for your brother to deal with any outstanding debt. I know you’re going down the route of asking the creditors to write of the debt due to hardship, it’s possible they may do this. However if this route doesn’t work I’d suggest your brother look at alternative debt solution options through a free debt advice organisation. Here you can find the link to StepChanges website here to explore the options available.

Thanks
Rachael

haycorns wrote: »

Hi. I am helping my brother sort out his finances and life following a stroke. He had been living rough in a caravan at his workshop and was ' self employed' buying things mending things and selling things ( mostly the first!) , but the stroke has left him unable to use his hands and earn a living. We have managed to get him into temporary accommodation and onto universal credit of £317 per month. He has a maxed out overdraft of £5000 and a loan of £7000 that he defaulted on some time ago. Interest charges on the overdraft are about £70 per month and £6 fees. we are going to write to the bank and explain financial hardship, but at present he has no hope of making significant payments . He has had the overdraft for about 6 years and never got out of it. interest payments over the last 6 years are about £5000 with about £1500 fees on tp of that. I am going to try and claim the fees back. Not sure what to do about the loan . Any suggestions would be most welcome. I would say he his light bulb has come on but its not shining bright enough yet!

ithepatriot

Dear All/ advisor,

Today I received a letter for a debt of £162. The letter is from a debt collector/ agency on behalf of a large telecommunication company.
I'm surprised as firstly; I have since moved house, use a different provider for talk and bb and I'm bemused as to how they have come across my address?
Second; I'm sure I cleared this debt with the provider as, the last agent I spoke to informed me they would collect the amount by the DD that was set up. I left them in April and only now have received this letter at my new address in November?
Any idea of the next steps please? Any help would be greatly appreciated.
Thanks.

StepChange_Allen

ithepatriot wrote: »

Dear All/ advisor,

Today I received a letter for a debt of £162. The letter is from a debt collector/ agency on behalf of a large telecommunication company.
I'm surprised as firstly; I have since moved house, use a different provider for talk and bb and I'm bemused as to how they have come across my address?
Second; I'm sure I cleared this debt with the provider as, the last agent I spoke to informed me they would collect the amount by the DD that was set up. I left them in April and only now have received this letter at my new address in November?
Any idea of the next steps please? Any help would be greatly appreciated.
Thanks.

Hi there

Welcome to the forum and thanks for posting.

Firstly, if you believe the debt has been paid, I'd try and find the evidence (e.g. bank statement), and then contact the new company to explain when it was paid.

In regards to them tracing you, it may be that the original provider wrote to your old address first, and if they got no response or returned mail that they then made efforts to trace you. This process could have taken a while, which may explain the delay between April and now.

This all boils down to whether you owe the money or not, which hopefully you can discuss and resolve with the company collecting the debt. They may need to go back to the original company to check details.

I hope this helps.

Allen

desperate_times

I am planning to set up a payment plan with Robinson Way regarding an approx £6000 credit card debt. I am wondering what monthly amount might be acceptable given the size of the debt? Is say £100/month going to be acceptable? They are threatening to pass to Howard Cohen solicitors to commence legal proceedings. Also what % of disposable income are they likely to accept. Let's say for example I have 500 disposable income and offer 100 are they likely to say no we want 300? Anybody with any experience of how they operate?

StepChange_Allen

Jambels14 wrote: »

Hi,
Can anyone advise/help?

I have 3 debts which I have been trying to clear over the past couple of years.
I am in a better financial situation to pay them off as now in paid employment and no longer a student and my partner is now in paid employment after being made redundant.

However I am really struggling to get loans to clear the debts to help consolidate the amount and pay more off quicker.

My debts - PRA started £5029 now £3856 default 29/04/14, Halifax Started £3499 now £2376 default on 04/02/13 and one I didn't realise I had was Santander £1425.

I am worrying what will happen when it gets to 6 years. What will happen at 6 years?

My credit scoring is very low.

Any advice on what I should do next or how to become debt free? Improve my credit rating

Many Thanks


Quick Reply
Thanks

Hi there

Thanks for your post.

Yes, it can become difficult to get consolidation loans eventually when there's a certain level of debt there, especially when your credit rating has already been affected.

Six years after the account defaulted it should drop off your credit file, so it's nothing to worry about. You still owe the money, but it no longer shows on your file.

It's quite tricky to do much to improve your credit rating whilst you're still in debt, so the best way to improve it may possibly be to get it cleared.

We can help you to work out a way forward with your debts; we offer free advice via either our online Debt Remedy tool or by calling our Helpline. Details of getting started can be found here: www.stepchange.org/Contactus

I hope this is helpful.

Allen

StepChange_Allen

desperate_times wrote: »

I am planning to set up a payment plan with Robinson Way regarding an approx £6000 credit card debt. I am wondering what monthly amount might be acceptable given the size of the debt? Is say £100/month going to be acceptable? They are threatening to pass to Howard Cohen solicitors to commence legal proceedings. Also what % of disposable income are they likely to accept. Let's say for example I have 500 disposable income and offer 100 are they likely to say no we want 300? Anybody with any experience of how they operate?

Hi there

Thanks for posting.

The offer of payment a creditor may accept is more likely to be based on your affordability than the size of the debt. Usually they'll want to see a copy of your budget to show what you can afford to pay, and generally expect payment of whatever is left after essential bills and living costs. If there's more than one creditor, they'd then expect that 'spare' money to be shared on a fair basis.

We can help you to work out a way forward with your debts if you'd like; we offer free advice via either our online Debt Remedy tool or by calling our Helpline. Details of getting started can be found here: www.stepchange.org/Contactus

I hope this is helpful.

Allen