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MP14

Looking for some advice. I have a bit of debt and have a much lower income following redundancy (stupidly, continued as normal for nearly a year using redundancy pay to top up income). Buried head in sand for 4-5 months now and stopped paying. Need to try and sort out but have minimal DI.

Hope to set up a self managed payment plan with creditors. Do I just write to them all with SoA and proposal? Or will they look for anything else.

DCFC79

Sarahandmelissa wrote: »

Hi, I feel like I'm stuck between a rock and a hard place. I owe 3 credit cards, totalling £16k. They all have an element of 0%. I think (from my working) £5000 is subject to interest. Although the combined income of mine and my husband SHOULD be sufficient to pay these off (minimum payments plus about £300 overpayment a month), due to his gambling and withholding funds from our household budget I can barely achieve the minimum payments! I wouldn't have this debt if it weren't for him- paying off extortionate phone bills, paying for food and fuel when there's not enough in the bank. I just don't know what to do any more! My anxiety is at an all time high! I'm snsppinv at the kids and I'm worried about our future.

Tell him to stop his gambling, take him to AA meetings or ask him does he want to stop.

re the phone bills, get a cap put in place.


Look at ways you can make cut backs, get rid of Sky/Virgin if you have it. Are you at the end of your phone contract, could you sell your phone and go sim only and buy a cheaper phone, same with your husband.

StepChange_Allen

virin96 wrote: »

Hello,

I currently have a £500 OD limit with lloyds and Monzo bank each. I am about -£470 with lloyds and -£490 with Monzo and also a credit card bill of £290 that I need to pay off. I have that debt because of uni, etc. So total debt roughly is £1300 (whole months salary). I just started my new job last Monday and will earn around £1,300 monthly. I live with my dad and grandma so I am rent free and just help out with groceries £50-£100 a month plus my spending which is about £100-£200 a month. Is it better to pay it all off in one go and then go back into overdraft for another month but finally be in credit come end of April (next payday)? Or should I pay back the debts month by month (100 a month for each bank)? My wages will also be paid into my lloyds account end of March, so should I maybe open another account and have my wages paid into that account? Thanks.

Hi there

Thanks for posting.

It's good that you're looking for advice on this before things get out of control. I'm not sure if you're being charged for your overdrafts, or if you've missed any payments to your card, so I can't be certain what the best way to tackle this is.

Generally, make sure (if affordable) that you maintain at least the minimum payment on your credit card, and that you keep the overdrafts within limits to avoid excess charges for going over the limit.

If you then have extra money available, I'd suggest paying this towards whichever costs you more in interest in charges per month, whilst keeping the other at least within the credit agreement.

I hope this makes sense and please let us know if we can help further.

Allen

MP14

Looking for some advice. I have a bit of debt and have a much lower income following redundancy (stupidly, continued as normal for nearly a year using redundancy pay to top up income). Buried head in sand for 4-5 months now and stopped paying. Need to try and sort out but have minimal DI.

Hope to set up a payment plan with creditors. How would I go about this?

StepChange_Rachael

Hi

Thanks for posting.

I can understand you and your wife’s distress under the circumstances. It’s something that shouldn’t have happened if they’d agreed to the arrangement. I’d certainly get back in touch with the department as soon as possible.

Your wife can also go to the bank and ask them directly to release the funds as they are necessary for living costs. If the bank doesn’t do this then you can raise a complaint, but they should release the funds when they are aware it will cause financial difficulties and the income is necessary for living costs.

Even if they do release the fund's I’d still suggest raising a complaint as it shouldn’t have happened in the first place.

I hope this helps and it gets sorted out soon.

Thanks
Rachael

neilied wrote: »

Please see below, what can be done?

Hi all. My wife has had a £2k overdraft for over 10 years, since we had our lovely little ones my wife hasn’t earned her old wage. She has just been living in the overdraft. After Lloyd’s made changes to the charges last year it fast become unaffordable. She approached the bank and they offered a short term agreement. They suspended the charges and downgraded her account. She had to make 3 monthly payments of £60 then she negotiated another 3 months at £70. More recently she spoke with another Lloyd’s person as she had been sent through to arrears/debt team. They said that she didn’t need to be dealt with by them but again set agreement to pay another 3 months of £70 which they mentioned that next maybe a 6 month or 12 month one.

Sorry for the big back story. So yesterday was the first £70 of the new agreement and she ensured it was available. Today was pay day and when she checked the balance showed her pay but available was zero. She panicked and contacted the bank but the department she needed hadn’t opened. The CS told her that they couldn’t see any agreement in place and that her OD was suspended and any payments into the account would go towards it. This has left us really short for the week and more so caused so much distress to my wife she has gone to work today in tears and so stressed. Poor show from Lloyd’s but not sure how we can fix this. I know we need to talk to the dept in question but it has stressed us and the kids out this morning so annoyed by this error.

Thanks

StepChange_Rachael

Hi

The creditors are going to want to see what is affordable after you’ve paid your household bills and general living costs and that your living costs are within reason based on your household.

Depending on the type of debt, you can then make payments directly to the creditors based on what is affordable and a fair payments based on the debt totals. Creditors can take further action but it’s less likely If they are happy with the payment they are receiving which is why a realistic budge is so important.

If there are debts like household arrears, secured debt or court fines then they would need to take priority.

You can of course deal with the creditors yourself but I would recommend using a free service to help build a realistic budget and get an understanding of all your options and the potential action creditors can take.

You can use Debt Remedy anonymously to access your advice and downloadable your budget at the end to help you explore your options based on your affordability.

Hope this helps,
Rachael

MP14 wrote: »

Looking for some advice. I have a bit of debt and have a much lower income following redundancy (stupidly, continued as normal for nearly a year using redundancy pay to top up income). Buried head in sand for 4-5 months now and stopped paying. Need to try and sort out but have minimal DI.

Hope to set up a self managed payment plan with creditors. Do I just write to them all with SoA and proposal? Or will they look for anything else.

FrancescaZ

Hi. My son recently signe dup to a debt management plan with Stepchange in an attempt to consolidate his monthly payments and safe in the knowledge that everything would be handled. To his astonishment he has been given a default by one credit card company as the minimum monthly payment was not being met.
He is mortified and was not aware that this could happen. He is trying to improve his credit rating and yet this path has made it worse.
Are companies able to put defaults on accounts that are being managed by debt management plans?
Please help, he is devastated and this is adding to an already worrying mental health situation.

sourcrates

FrancescaZ wrote: »

Hi. My son recently signe dup to a debt management plan with Stepchange in an attempt to consolidate his monthly payments and safe in the knowledge that everything would be handled. To his astonishment he has been given a default by one credit card company as the minimum monthly payment was not being met.
He is mortified and was not aware that this could happen. He is trying to improve his credit rating and yet this path has made it worse.
Are companies able to put defaults on accounts that are being managed by debt management plans?
Please help, he is devastated and this is adding to an already worrying mental health situation.

I think someone has mis-understood the term “debt management”.
You don’t improve your credit report by going into debt management, but you do to improve your debt situation.

Everyone who enters debt management should expect defaults as you will not be making the original contracted repayment will you.

It’s standard procedure to expect defaults, and would have been explained to him, this is why it pays to do your research first before agreeing to anything, as it appears from your post he has not understood, (A) what debt management entails, and (B) what he was told.

Bokkie10

Hi... I have finally admitted defeat.. I am drowning in debt. I have made my I&E sheets for each of my creditors...wrote them each a letter with an offer of payment requestion a standing order for the amount in my letter... Do i now need to cancel my direct debits even if I have not heard from any of them yet to agree to it?

StepChange_Allen

FrancescaZ wrote: »

Hi. My son recently signe dup to a debt management plan with Stepchange in an attempt to consolidate his monthly payments and safe in the knowledge that everything would be handled. To his astonishment he has been given a default by one credit card company as the minimum monthly payment was not being met.
He is mortified and was not aware that this could happen. He is trying to improve his credit rating and yet this path has made it worse.
Are companies able to put defaults on accounts that are being managed by debt management plans?
Please help, he is devastated and this is adding to an already worrying mental health situation.

Hi Francesca

Welcome to the forum and thanks for posting.

I'm sorry to hear that your son is upset and concerned after receiving this default notice. When discussing with and offering solutions to our clients we'd always explain the potential consequences of those solutions so this is surprising to hear. When we provide advice on a DMP we'd explain that it will affect a client's credit rating and have other potential impacts, because the contractual payments are no longer being made.

So yes, creditors can and will put defaults on anyone's credit file if they're on any debt solution that by definition involves not paying what was originally signed up to.

If your son feels that this wasn't explained fully or clearly, he can make a complaint so that we can investigate. A copy of our complaints procedure can be found here: www.stepchange.org/Legal/complaints-process

Please also let us know if he needs any help and support with his mental health as we recommend ways of getting support for this.

I hope this helps to provide a little bit of clarification, but please ask your son to contact us if he'd like to discuss anything further and/or to clarify any advice areas.

Best wishes

Allen