Need to shift the debt...thoughts?

KaidusKarma

I'm thinking DMP to be honest. Basically its £17k on credit cards built up throughout my marriage because my wife was bankrupt when I met her, so all the credit cards went in my name but it was joint spending. She ditched me and is now happily starting her own business whilst I die under the pressure of making minimum repayments every month, then using the cards to buy food and live frugally.

SOE is here:

Statement of Affairs and Personal Balance Sheet

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

Monthly Income Details
Monthly income after tax................ 1220
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1220

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 102
Rent.................................... 515
Management charge (leasehold property).. 0
Council tax............................. 0
Electricity............................. 0
Gas..................................... 0
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 32
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 150
Clothing................................ 20
Petrol/diesel........................... 100
Road tax................................ 16
Car Insurance........................... 60
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 10
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 10
Haircuts................................ 6
Entertainment........................... 20
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1061


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 1560
Other assets............................ 0
Total Assets............................ 1560


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 0........(0)........0<
Car loan.......................2000.....(102)......10
Total secured & HP debts...... 2000......-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Barclaycard....................6195.31...150.2.....17.6
MBNA...........................5197.78...125.......15.9
Aqua...........................3622.41...140.......38.9
Bank of Scotland...............2069.38...50........25.9
Total unsecured debts..........17084.88..465.2.....-


Monthly Budget Summary
Total monthly income.................... 1,220
Expenses (including HP & secured debts). 1,061
Available for debt repayments........... 159
Monthly UNsecured debt repayments....... 465.2
Amount short for making debt repayments. -306.2

Personal Balance Sheet Summary
Total assets (things you own)........... 1,560
Total HP & Secured debt................. -2,000
Total Unsecured debt.................... -17,084.88
Net Assets.............................. -17,524.88

Created using the SOA calculator at the place you all know to go - apparently I can't post with links!
Reproduced on Moneysavingexpert with permission, using other browser.

I'm not sure if the numbers are right (I live in a shared house and rent includes all bills), but I have to be careful as I can't lose the car, otherwise I cant work.

Any help would be much appreciated! I'm away with work for a few days so chances are I won't get back here until next week but I'll try and keep checking.

dieselv2

What is your credit report like. Can you switch any of the cards to 0% APR. That AQUA card needs to go urgently due to high APR. 40% interest WOW!

If you have no defaults you need to be prepared that going via a DMP companies may issue a default which would restrict you getting a mortgage in the future (or for 6 years at least).

Phone StepChange and they'll work everything out and give you best route to go down.

[Deleted User]

Maybe have a look into a DRO although I suspect your car maybe worth too much for that, it used to be if you had a car worth less than a £1000 but that might have increased.
ETA it is still £1000, have a word with the debt charity "step-change" get some advice

fatbelly

You're right. At first glance it looks like a dmp, and maybe a long one

I wonder if the car loan is an unsecured loan (You've declared the car as an asset, which of course it would not be if it's on HP) and so could be chucked into the dmp, and liberate another 102 per month.

If it is HP, then it looks like another 20 months to go before it clears and you can find some more cash maybe.

Your soa looks realistic. But with your rent including so many bills, I would struggle to get you under the £50 threshold for a DRO so I think that's out for now.

Bankruptcy is a possibility, with a 3-year income payments order but the car payments could cause an issue.

I think what I'd do is stop paying the cards, get a bank account unconnected to your debts and talk to Stepchange or Payplan about a dmp.

enthusiasticsaver

All the debt is on really high interest rates so if you are only paying minimum payments you will never pay it off. Can it be moved to 0% cards? You are on a relatively low wage so you may have difficulty moving it as you will come up as being very over committed.

Personally I would say you have no option but to default and go on to a dmp. Ring stepchange and see what they advise. You will need a bank account with no overdraft facilities unconnected with your existing creditors. Building up an emergency savings account is a must too.

KaidusKarma

If I could get the interest frozen I'd probably be okay, that's what's killing me.

The car is a loan but says that the vehicle is property of the finance company until paid off. I cannot lose that car though, otherwise I lose my job.

National_Debtline

KaidusKarma wrote: »

If I could get the interest frozen I'd probably be okay, that's what's killing me.

The car is a loan but says that the vehicle is property of the finance company until paid off. I cannot lose that car though, otherwise I lose my job.

If the car debt is a loan but currently the property of the finance company it could possibly be a bill of sale (log book loan), otherwise it must be a type of finance such as HP or PCP. Either way, it’s a priority for you as you want to keep the car.

Often interest is frozen on debts in a free DMP, so I agree it looks like a good option for you.

James
@natdebtline

EssexHebridean

Statement of Affairs and Personal Balance Sheet

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

Monthly Income Details
Monthly income after tax................ 1220
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1220 Have a think about ways to supplement this - even small gains might help a bit

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 102
Rent.................................... 515
Management charge (leasehold property).. 0
Council tax............................. 0
Electricity............................. 0
Gas..................................... 0
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 32 Is this tied to a contract?
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 150 Just you? You can knock £50 off that - shop in Lidl & Aldi if you have them locally, meal plan, and meal plan around the "Pick of the Week" and "Super 6" offers from those supermarkets too.
Clothing................................ 20 You can cut this for a while, and just buy pure essentials, no?
Petrol/diesel........................... 100 Read Martin's "driving economically" guide - and check the petrol prices website to pin down your cheapest fuel locally.
Road tax................................ 16 Is this actually being paid monthly?
Car Insurance........................... 60 have you checked this is as cheap as you can get? That's a big old bill!
Car maintenance (including MOT)......... 20 Where are you saving this? You're not showing any cash assets
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 10
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0 Beware - it's relatively unlikely that this IS covered by your rent.
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 10
Haircuts................................ 6
Entertainment........................... 20
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1061


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 1560
Other assets............................ 0
Total Assets............................ 1560


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 0........(0)........0<
Car loan.......................2000.....(102)......10
Total secured & HP debts...... 2000......-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Barclaycard....................6195.31...150.2.....17.6
MBNA...........................5197.78...125.......15.9
Aqua...........................3622.41...140.......38.9
Bank of Scotland...............2069.38...50........25.9
Total unsecured debts..........17084.88..465.2.....-


Monthly Budget Summary
Total monthly income.................... 1,220
Expenses (including HP & secured debts). 1,061
Available for debt repayments........... 159
Monthly UNsecured debt repayments....... 465.2
Amount short for making debt repayments. -306.2

Personal Balance Sheet Summary
Total assets (things you own)........... 1,560
Total HP & Secured debt................. -2,000
Total Unsecured debt.................... -17,084.88
Net Assets.............................. -17,524.88

Presumably if you drive as an essential part of your job you also claim back some of your car costs - is that shown within your income already?

I'm guessing that there is no 0% cards available to you? Have you joined the MSE credit Club to double check on what you may be able to get? The thing is, there are tweaks you can make to the SOA but you're still a long way off making the shortfall.

I take it that you are no longer using the credit cards? It sounds like you're not but it's always safer to ask!

enthusiasticsaver

As far as I can gather you are still using the cards for food etc as you are using all your money to pay the debts back? Is that correct? If so, then stop as you are on a never ending spiral of debt.

fatbelly

KaidusKarma wrote: »

If I could get the interest frozen I'd probably be okay, that's what's killing me..

That's why we're leaning towards a DMP.

KaidusKarma wrote: »

The car is a loan but says that the vehicle is property of the finance company until paid off.

That's sort of mutually incompatible. If this is finance that you took out when you acquired the car, the it will not be a logbook loan, it will be something you signed an agreement for.

If you can find the agreement it should be headed 'X agreement regulated by the Consumer Credit Act'. X will be Loan, Hire Purchase or Conditional Sale.

It is important to check this before taking advice about your options

KaidusKarma

I'm away now as said earlier but will dig out the car stuff and check when I get back.

I did see the comments on the SOA but can't quote as on phone...but points are:

- mobile phone is a contract.
- don't have time to supplement work as studying for an OU degree
- Petrol is two full tanks a month which is about average for work and travel for tutorials. I drive a lot around the city and my 11yr old 1.4 isn't the most economical. Lucky if I get 300 miles out of a tank driving economically.
- Groceries I'm limited on what I can eat due to health.
- road tax is monthly and car insurance...I've only been driving 3 years in April. Plus it's monthly as well.
- clothing is an average over the year and includes costs for dry cleaning my suits.
- same for car maintenance - includes costs for MOT/Service/tyres etc.

I am aware I don't have contents insurance either :-(