Needing advice about a loan

LostBalance92

Morning everyone. Pretty stressed right now.
I decided to post here as I've noticed this is a very understanding, supportive forum for people with debt issues and I really don't need judgement right now.
In August of 2017, I took out a £9,800 loan with Amigo. I needed to fund my final year of a university course due to several issues relating to student finance (I wasn't entitled to further funding and such) My wonderful partner was my guarantor and he also agreed to pay some of the loan back himself as he used £2,500 of it for a down payment on a new car. He had a good job at the time so the application went through smoothly.
In December I fell into arrears with my amigo loan because I lost my part time student job. Keep in mind, I had no other income. I spiralled into depression after then losing my sister and one thing lead to another. I ended up claiming ESA and PIP and still am to this day. I also claim housing benefit because I live alone. I am no longer studying, so due to my ill health the Amigo loan was all for no reason.
Anyway, the original agreement was that I had to pay £385 back a month for 6 years (Or there abouts) I contacted them and said I could no longer make the payments. Of course they chased my partner for the money and until June of this year he somehow kept the payments up for me, whilst I gave him £100 a month towards them. At this stage I was still living at home with my parents and hadn't been accepted for a council flat, so it was money I had to spare.
My partner then had his hours at work drastically cut and still to this day is struggling financially.
He contacted Amigo who wouldn't reduce his/our payments to less than £250 a month. They said anything less was unreasonable and us not making effort to pay.
Long story short - we still can't afford those payments and we both received emails today telling us that they are now sending us both a letter out with regards to legal action. Apparently if they don't come to an agreement with us they'll serve us with a CCJ.
How does this work? We understand we need to pay this debt back, nobody here is disputing that - but we cannot afford it at the price Amigo is asking for. My partner called them a few days ago as a last resort to sort something out and they wouldn't accept his offer of £100 a month. That is all we can both afford.
We are currently living separately, which as you can imagine doesn't help matters as we have two different rents to pay but it is what it is, and I need some advice.
I've listed my monthly budget below-
Income-
ESA (IB) - £500 a month
PIP - £330 a month

Rent - £250 a month (Housing benefit pays a portion for me)
Council tax - £65 a month
Food - £200 a month
Gas - £40 a month, has increased due to cold weather recently
Electric - £40 a month
Water- £18 a month
TV License - £11 a month
Mobile phone bill - £40 a month
TV and internet package - £33 a month
Food and insurance for my dog - £25 a month
Other loan repayments - £30 a month (These have currently gone to debt collectors who have accepted lower amounts)
Travel - £10 a month, but I rarely ever go out anymore due to my anxiety so I guess this could be knocked off

So as you can see, there is not a lot left for me to work with. I'm very worried that this will go to court and I will be expected to pay an unreasonable amount back that I can't afford.
What is the way forward from here?

[Deleted User]

If you do end up getting a CCJ, you still won't be able to pay more than you can afford.

Keep paying what you can.

Visit the DFW boards for advice on cutting costs and more specific debt management advice.

desperate_times

I think they are bluffing about the CCJ well at least for now. That would involve them going to court and most lenders take years before getting to this point. I don't know about AMIGO but other lenders will keep chasing you and may at some point pass to a debt collection agency who will then keep chasing you (letters, phonecalls etc). I would just keep paying whatever you can and in the worse case it did go court you are not going to be end up paying more than you can afford.

desperate_times

Another idea although perhaps difficult given partners situation but could he borrow some or all of the money from another more mainstream lender at a more reasonable interest rate. He could then use this money for pay off or substantially reduce AMIGO loan. The monthly payments on the new loan if he could get one would be much lower.

foxy-stoat

desperate_times wrote: »

Another idea although perhaps difficult given partners situation but could he borrow some or all of the money from another more mainstream lender at a more reasonable interest rate. He could then use this money for pay off or substantially reduce AMIGO loan. The monthly payments on the new loan if he could get one would be much lower.

That would be my preferred option but by the looks of it their credit history isnt very good so will struggle to get any further credit.

DCFC79

You say your partner had hours cut, has he looked for another job ?

desperate_times

foxy-stoat wrote: »

That would be my preferred option but by the looks of it their credit history isnt very good so will struggle to get any further credit.

Yes perhaps. Obviously not for OP but maybe possible for partner. The partner's credit was obviously not terrible initially otherwise would not have been able to be guarantor and also as the Amigo loan would not be registered on his credit file I think he might be able to get another cheaper. Worth a try.

Clive_Woody

Might be worth talking with one of the free debt charities (such as Step Change) who may be able to negotiate a repayment plan on your behalf, at the very least they will be able to offer advice on what will happen and what to expect as they will have seen this many times before.

Worst case it goes to court and you agree repayments. The court will not order unreasonable payments

System

If you are single then £200 a month is too much for food. ONS figures state the average for a family is £56 a week and that includes roughly £4 on booze.

As has been suggested, it might be an idea to go on the debt free wannabe board and post a SoA (stickie on how to do that is at top of DFW board topic list.).

Xbigman

The issue with Amigo is that the extra fees and interest they will charge will blow the debt up out of all proportion to the original amount borrowed. Its best to get something sorted out as soon as possible.



Darren

Bermonia

All lenders have an obligation to treat those in financial difficulty sympathetically (within reason)... as advised by others contact an organisation like step change or citizens advice bureau for help, or speak with amigo and make a realistic offer of payments - based upon your income/expenditure, it is not in their interest to take someone to court who is willing to engage and to pay (token gestures such as a £1 a month are not going to win them over)