Tornado of debtors

Brokenlost

Hi all.
I'm spinning through hoping someone can point me the right way to my debt free rainbow!
Have always been bad with money. If I have it, I spend it. Food and children's treats is the main distraction. So, when I married I left the Mr to control the account and just tell me what was available weekly. I've now found he's been using pay day loans every month for the last two years. Varies between 80 and 200. I knew nothing. He's maxed his cards to the point they're blocked, he's got 4 debt collection agreements in place too. Our overdraft is more than his monthly salary. I've gone through the last month's bank statement and see we got hit with charges of 220 for failed direct debits and going over the agreed limit. One month arrears on the mortgage. All insurances except the car got cancelled for non payment. We have 250 more due to go out than come in this month. I've called the mortgage company and explained. They've agreed a payment plan, what should I do next to start sorting this mess out??:eek:

parsniphead

Firstly well done for posting. There are some amazing people who will help on this site.

Get a statement of affairs done which will show where you are. You need to find out exactly where your money is going.

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

There is a way out of all debt. Keep strong.

rockabillygirl

Hi, I didn't want to read and run and wanted to wish you both the best of luck in sorting out your finances. There will I'm sure be someone along soon, far more knowledgeable than I to offer advice, but wanted to give my support x

Ilona

Hi. As above, the Statement of Affairs is the first step. Gather all your paperwork together, bank statements, bills, receipts, wage slips, anything connected with your incomings and outgoings. Lay them out on the kitchen table, sort them into piles, put them in date order. Two large pieces of paper and start itemizing everything. When you have all the figures in front of you transfer them to the SOA.

If you are not sure what you are spending on start a diary. A notebook in the kitchen drawer, keep all receipts from shopping, write down every penny you spend in the notebook, even the newspaper, packet of crisps, or choccy bar. That's a good start.

When you have done this post your SOA on here and the good people can suggest where you might be able to cut back on your spending. Good luck, you can do it.

Ilona

EssexHebridean

Bless you - what a muddle. Great advice already given above - first step is definitely the SOA, this gives you a budget to work to and you then tweak that until it reaches a point where it's workable for you and you know where every penny is going, and how much you should have left.

It's sortable one way or another - promise you that, but the sooner you tackle things, the quicker you stop things getting worse.

sourcrates

Brokenlost wrote: »

I've called the mortgage company and explained. They've agreed a payment plan, what should I do next to start sorting this mess out??:eek:

Stop prioritiseing unsecured debt over secured.

Mortgage, council tax etc are essential payments, and must be paid first, the unsecured credit is the last thing you should pay.

If there's nothing in the kitty, then don't pay it, for now.

Post an SOA, have a look on some of the debt charity websites in my signature, that will give you some idea of your options.

National_Debtline

Hi there and welcome to MSE,


I agree with other posters about the SOA and sourcrates advice regarding prioritising is essential. A couple of other things that will help you take control of this is firstly, change banks and secondly, stop the payday loans taking their payments.

So, when you owe debt to your bank they can take money from your current account towards that debt, without needing to ask you for permission. We generally accept this with an overdraft, but an overdraft is not a priority debt and your budget will be too hard to stick to when you are in your overdraft every month. So, a new, free, basic bank account is essential.

The other issue is that payday loans normally set up a continuous payment authority as part of their agreement which lets them take money from the account, even after the direct debit has been cancelled. You need to cancel this authority with your bank with this letter - https://www.nationaldebtline.org/EW/sampleletters/Pages/Withdraw-your-continuous-payment-authority-from-your-card-issuer-%28sole-name%29.aspx


From here you can start to overpay your mortgage (and any other priority debts) to get them back on track, first and foremost. Then look at re-neogotiating to pay what you can afford to the credit debts. You may do this yourself or through a free DMP. There may be other options as well, but they will become clearer once you post your SOA. Good luck,


Laura
@natdebtline