How can I clear debts once and for all

Chloe90

Hi I've just joined this site, I've never used a forum before not sure how it works so hopebt this is the right place to post...

Im feeling like I'm doing my best to pay bits of my debts of month my month but nothing changes interest is added and it just stays the same! I owe 2,400 on a vanquis card (2,500 limit) 800 to likely loans, 450 to littlewoods. I have a holiday that needs paying off by may )£800) my car insurance is due next week last year was 800 now cheapest quote I can find is 1,800 as I was involved in a small accident that was not my fault the other party will not take responsibility so it's not been settled yet but insurance company informed me it will stay appear as a claim as they predict the worse case scenario...

I'm a single mum unfortunately living with my parents as I can't afford rent... I work full time on minimum wage. Have childcare costs mobile phone bills food toiletries petrol etc to pay all the usual things and all these debts to try pay off, I did have a bad spending habit hence catalog debts, in a way I think I used this as therapy for my depression and stress receiving new things would give me a little boost I would buy things I didn't even want or need, I have with help managed to stop the spending and all income goes on essentials now....

my credit score is terrible as I had 5 payday/personal loans last year which makes me think I'll never be able to have a place of my own I was involved with 2 loan sharks I don't want to go in detail but it was a very scary time and used these loans to pay them back which is now done and I have not heard from them in a long time...

I have seen about switching to 0% credit card to transfer the balance as interest from vanquis is about 100 pound a month but I'm not sure I can do this because of my credit raiting and I don't want to apply for any more credit if I'm not going to get it.... basically I'm just looking for any advice for the right way I can try sort this mess out! I have become depressed I took an overdose last year when thing where at there worse and I'm just so frustrated I feel stuck like I'll never be able to turn things around and make a better life for me and my child

EssexHebridean

Right - first things first, take a breath. Nothing is unfixable, and there WILL be a solution.

Your first step is to put together your SOA (Statement of Affairs) - you'll find the link i the "Sticky" post at the top of the board. Be as accurate as possible and remember to include the less regular costs - insurances etc that may come out annually for example. If you say you're setting money aside for things though you need to put a facility in place to do so - otherwise it all goes to pot. Think through every line to be sured whether something applies to you or not. Then post it in here and we can take a look, and see where you may be able to make savings.

Drawingaline

As EH says, post up a SOA, and have a look at contacting one of the financial charities for advice, stepchange or nation debt helpline.

davidwood123

Cancel your holiday.

You're £800 better off straight away and you won't need to spend on holiday money, clothes, taxis etc

ReadingTim

Can your parents help out with childcare, so you're spending less on that than at present? Given you're living at home, this should be manageable.

Post an SOA so we can see what's coming out, but the main problem is likely to be that you're not earning enough. Assuming you're getting all the benefits you're entitled to, you need to find a 2nd job, or a better paying first job. "Minimum wage" just isn't enough, and there are only so many hours in a day...

January2015

ReadingTim wrote: »

Can your parents help out with childcare, so you're spending less on that than at present? Given you're living at home, this should be manageable. .

This makes the assumption that one or both of the OP's parents do not work.

As a grandparent myself, permanent childcare is a huge burden to put on parents/grandparents. Whilst I love to help out and have grandchildren as and when I can, I couldn't do it day in, day out - apart from the fact that I need to work to clear my debts, I need to work to plan and build my pension for my retirement.

nkkingston

Debt always has a solution. Usually it has several. The important thing is to stay up to date on the priorities, and then figure out what you have left over to pay the rest. It looks like all your creditors are non-priority, and you're not a home owner, so potentially you've got multiple options open to you. You may find a DMP or a DRO works best for you, or you may find a way to keep chipping away at the debt and keep your head above water by making other cutbacks (or, as ReadingTim suggests, finding a higher paying job, though we appreciate those are hard to come by!). Check out the "reclaiming money from payday loans" thread, in case any of your loans count as irresponsible lending and you might be able to get a little lump sum back to start snowballing your credit debts.

You can report the loan sharks to the illegal money lending team. It won't necessarily help you now in terms of the money they took off you, but at least you can help keep others safe from them, and you can do it anonymously.

(I'm kinda fascinated with loan sharks, because it's never the people you'd expect. Little old grannies turn out to be running massive organised crime rackets because they're so good at befriending vulnerable people and 'offering to help' and suddenly people are sending their kids out to shop lift to keep little old granny's massive thugged up grandsons from coming round)

sourcrates

nkkingston wrote: »

(I'm kinda fascinated with loan sharks, because it's never the people you'd expect. Little old grannies turn out to be running massive organised crime rackets because they're so good at befriending vulnerable people and 'offering to help' and suddenly people are sending their kids out to shop lift to keep little old granny's massive thugged up grandsons from coming round)

Funnily enough, its more likley to be a woman, befriending other woman, most likley with kids, most likely single mums, and most likley at nursery, or other social gathering.

ani*fan

Hi there Chloe90 :hello:

Lovely to meet you and welcome to the boards!

I'm sorry to hear you've had such a horrible time with loan sharks. That must have been very frightening for you and I'm glad it's all sorted out now. Good.

The first thing you need to do is find out how much interest you are paying on your current debt. You're right in that paying less interest means that more of your payments go to reducing the debt, so it will help to get a picture of what the situation is now.

As others have already said, you also need a statement of affairs so we can help you save money and reduce costs.

Only you can decide if the holiday is worth it or not. Some people on here prefer the peace of mind in paying down debt instead of taking holidays. I like a holiday so have not sacrificed those in my debt reduction journey. It's up to you.

How old is your child, btw?

Best of luck.

angelpye

Hi, do you get tax credits? If not have a look into it as I think it doesn't matter that you live with your parents and they help with childcare costs.

Other than that, as the others have said, do the SOA and it gives a good clear picture of your circumstances. I am on a low budget and only just paying above minimum payments so I know how frustrating it can be and how hopeless I felt when I came to the forums...you are not alone and it can be done. Sounds like you have had a run of bad luck but it will get better - hang on in there!

fatbelly

Your credit 'score' is pretty meaningless. If you are paying the contractual amounts on your cards and loans you may not be viewed as badly as you think.

You can do a pre-application eligibility check on this list

http://www.moneysavingexpert.com/credit-cards/best-0-credit-cards

but I agree with the others that an soa will help you to develop a strategy for getting debt-free.

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

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