Help with Debt Solutions please

OA456

Good Day,


I have a few questions regarding my debt, please.


I have had a change of circumstance and I am finding it very difficult to make my monthly payments.


I was wondering if you could be of assistance please ? The monthly payments are due very soon.



My total debt is about £95,000 (with interest).



I am not sure what solution is best for me. That is why I require your advice, please.



So, would an IVA, DMP, DRO or Bankruptcy be an ideal solution for me ?


Also, please, does anyone know of a good & reliable company that can advise me regarding a solution ? It would be helpful also, to know (if possible), how long it will typically take to set up a solution and how much it will cost, please.



In addition, I just started a permanent job and I get my 1st salary at the end of this month. Please, do you know if it will in any way affect me getting a debt solution - like a DMP, DRO, IVA, etc ?



Thanks!!

Willing2Learn

OA456 wrote: »

… I have a few questions regarding my debt, please.

I have had a change of circumstance and I am finding it very difficult to make my monthly payments.

I was wondering if you could be of assistance please ? The monthly payments are due very soon.

My total debt is about £95,000 (with interest).

I am not sure what solution is best for me. That is why I require your advice, please.

So, would an IVA, DMP, DRO or Bankruptcy be an ideal solution for me ?...

Hi OA456 and welcome to the forum

To correctly assess which option would be best, we would need to see your Statement of Affairs (SOA). Please complete the SOA form and copy/paste it up in this thread. The link is below:
http://www.stoozing.com/calculator/soa.php


Please do not consider any of the fee-charging Debt Management Companies when you seek professional advice. Choose from one of the free options available. These are StepChange, PayPlan, National Debtline and the CAB.

Edit: The first thing you can do today, assuming you are not able to pay your minimum contractual payments, is to write to all of your creditors, asking them freeze your accounts while you seek advice. A letter template is linked below:
https://www.nationaldebtline.org/EW/sampleletters/Pages/Hold-action-on-your-account-%28sole-name%29.aspx

sourcrates

Moved to the DFW board, please continue to post here.


I see you have posed the same question to the stepchange advisor, that is a good place to start, but we can probebly help you quicker on here as they are extreamly busy just now.


Thanks.

OA456

Hi,


Thank you for your response.

Here are the results:

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 0
Number of cars owned.................... 1(Wife)

Monthly Income Details
Monthly income after tax................ 1200
Partners monthly income after tax....... 2000
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 3200

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 303
Rent.................................... 640
Management charge (leasehold property).. 0
Council tax............................. 145
Electricity............................. 200
Gas..................................... 0
Oil..................................... 0
Water rates............................. 32
Telephone (land line)................... 0
Mobile phone............................ 30
TV Licence.............................. 12.87
Satellite/Cable TV...................... 30
Internet Services....................... 16
Groceries etc. ......................... 0
Clothing................................ 15
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 150
Car maintenance (including MOT)......... 12
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 17.5
Other insurance......................... 0
Presents (birthday, christmas etc)...... 10
Haircuts................................ 10
Entertainment........................... 10
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1633.37


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


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 0........(0)........0
Hire Purchase (HP) debt ...... 14000....(303)......7
Total secured & HP debts...... 14000.....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Halifax Loan...................27000.....480.7.....25
NatWest Loan...................13100.....326.1.....12
Likely Loans...................9000......261.1.....59.9
Debenhams Credit Card..........2100......90........0
Luma...........................180.......10........0
CapitalOne.....................1450......70........0
BarclayCard....................780.......25........20
Vanquis Credit Card............1450......60........0
Aqua Credit Card...............235.......30........50
Hlaifax BOS C/Card.............453.66....12........0
Halifax MasterCard.............3737.79...37.38.....0
Halifax MasterCard.............625.01....11.9......0
MBNA Credit Card...............3950......380.......0
Halifax OverDraft..............2400......100.......0
Santanader Overdraft...........500.......30........0
Everyday Loans.................12000.....280.......120
Aqua Loans.....................6400......186.7.....19
Berkshire Credit Unio..........7500......213.......18.9
Total unsecured debts..........92861.46..2603.88...-


Monthly Budget Summary
Total monthly income.................... 3,200
Expenses (including HP & secured debts). 1,633.37
Available for debt repayments........... 1,566.63
Monthly UNsecured debt repayments....... 2,603.88
Amount short for making debt repayments. -1,037.25

Personal Balance Sheet Summary
Total assets (things you own)........... 0
Total HP & Secured debt................. -14,000
Total Unsecured debt.................... -92,861.46
Net Assets.............................. -106,861.46


Thanks very much!

David2Prit

Hello!!

Do you have any space on the 0% CC to move some of the massive APR debts onto?

£200 electric? Can this be cut down.
Road tax 0?
Food shopping 0?

I honeslty, looking at it. Write (also ring to inform, letters get lost) to all creditors, and inform of financial difficulty, pay token payments of £1 per month at present. This will hopefully give you some space to breath.
Then send a CCA to every single one! search on here regarding this. Pretty straight forward.
Set up a brand new basic bank account, no overdraft!! Leave the other bank account open, but only keep enough money in that account to cover token payments, everything else in new account.

Then with even half what you were paying on debt, look to build a decent emergency fund.

DCFC79

You out of contract soon on your internet and tv ?

Do you need a tv licence?

Id cancel the TV and licence and get say Netflix for something to watch in the evenings.

Willing2Learn

Hi again OA456,

Firstly, please accept my apologies for the bombardment of questions, but they are all important....

Is your £1,200 income, your salary for the new job that starts at the end of June? If it is not, then what will be your monthly income be once you start your new job?

With your monthly expenses, is that your combined outgoings for both you and your wife?

You have entered £0.00 for monthly groceries, is that correct?
You have entered £0.00 for monthly petrol, is that correct?
You have entered £0.00 for monthly car parking, is that correct?
You have entered £0.00 for monthly road tax, is that correct?
You have entered £0.00 for monthly home contents insurance, is that correct?


Definitely open a new bank account tomorrow as you need to ring-fence your income. Make sure the bank is not with the Santander, HBOS or RBS banking groups (I recommend Nationwide or Co-Op, as they are both independent).

Do you have any joint bank accounts? If so, who with?

Also today or tomorrow, send letters out to all your creditors, asking them to freeze your accounts while you are seeking advice. The link for the letter template is in my earlier post.

Also, give your self a pat on the back as you have taken the first step on your debt-busting journey...

David2Prit

Another bank I may suggest would be Monzo. It's not for everyone if you like to have a typical high street bank, but in pure tracking spending, it's amazing and really helped me out.

enthusiasticsaver

You need to ring fence your income as willing says so open a bank account with someone you don't owe money to.

How did you build up so much debt or have you fallen into a debt spiral by trying to keep payments up?

Have you defaulted on any? I honestly think you cannot get out of this without some type of debt solution. Bankruptcy I think is problematic because you do have a surplus after essential bills each month and you have an expensive car. That would have to go. It may also cause you problems at work or if renting property in the future.

An IVA May be suitable but personally I would opt for a DMP and stepchange will help you with that. A DRO is for people with much smaller debts. Do not pay for any debt solution. There are plenty of free options. If the interest was frozen and you paid £1000 a month towards the debt it would be cleared in about 7-8 years. I also wonder if you can get any money refunded by lenders who have lent to you irresponsibly which must be the case unless you lied to them to borrow more. I would query that Everyday loan and Likely loan (pay day lenders) and the Halifax one. Given that the rate is high I would think they knew your finances were in a mess. It is such a shame you did not address this sooner but better late than never. It can be sorted but the next 6 years will be difficult with no access to credit and defaults on your file.

So first open a clean basic bank account.

Then start saving the payments you were paying to debt but I am not sure about the car loan. Is that in your name or your wife's?

Talk to stepchange and see what they recommend. If they push for an IVA make sure the soa is reasonably generous and realistic. There are guidelines as to how much you can put in each category.

Write to your creditors and ask for 6 months breathing space while you sort out the next steps.

Do an accurate soa allowing for food, car expenses, contents insurance. Is the car insurance really £150 per month or over the year.

One thing you do need to do though is sit down with your wife and decide if you will do this as a joint thing or whether just you or even her. Whose name is the debt in? Having a breakdown of whose name it is in will help decide the way forward too. You also need to allocate something to emergency savings.

Your electric is high. Are you up to date with that or paying off arrears?

System

I think you are missing some things. How did all this happen? If you've got 95k of unsecured debt and £303 pcm secured - what's the full total?

OA456 wrote: »

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 303 is this on top of the unsecured?
Rent.................................... 640
Management charge (leasehold property).. 0
Council tax............................. 145
Electricity............................. 200 This is huge. Are you on storage heaters? If so, can you get on economy 7? Even so, I had storage heaters in my house and although it was coldish sometimes and it's a pain, I never paid more than around £50 a month
Gas..................................... 0
Oil..................................... 0
Water rates............................. 32
Telephone (land line)................... 0
Mobile phone............................ 30
TV Licence.............................. 12.87
Satellite/Cable TV...................... 30
Internet Services....................... 16
Groceries etc. ......................... 0
Clothing................................ 15
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 150 Is this per month? So you pay £1800 a year? What do you drive?
Car maintenance (including MOT)......... 12
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 17.5
how old are you? You possibly don't need this yet.

Other insurance......................... 0
Presents (birthday, christmas etc)...... 10
Haircuts................................ 10
Entertainment........................... 10
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1633.37

OA456

Hi Willing2Learn, thank you very much for the information. I have filled the information and I will do the necessary.


Thanks very much once again.