Struggling with debt? Ask a stepchange debt adviser a question

StepChange_Aidan

bexx_00 said:

Hi,
I’m 30, FT employed with no house/mortgage. I live with my partner and essentially pay him ‘board’. 

I have credit card and overdraft debts of £17,000. 

Most of these have now expired on the 0% and all interest payable. 

I have recently tried to calculate to pay fixed amounts each month to pay them off within the next 4 years, some sooner. 

I have recently changed my accounts so I have an account which i transfer all the ddi amounts for the CC payments each month. 

Then have a separate account for my (spends). 

I have previous issues with spending and credit cards when I had depression and still have bad habits now which I’m trying to stop!
I am good at paying my payments each month and have never missed a payment,( more spending and adding to the CCs when I’d clear with a 0% balance transfer. )

However I’m now wondering if i should get a debt consolidation loan to pay them all off (7 CCs)  and just have the one debt?
would I be eligible (I’m not eligible for any 0% CCs atm) and would this be the best thing to do? 

Tia 

Hi,

Thanks for posting and welcome to the forum.

It’s good to hear that you already have plan to clear the credit cards over the next four years. 

I wouldn’t normally recommend debt consolidation loans as you’re likely to end up paying more back in the long run. It could be better to continue with your current arrangement if it’s affordable, but I can’t really say what your best option is without knowing more about your finances. I’d suggest using our online debt advice tool or giving us a call to speak with an advisor.

There’s some more information about debt consolidation here.

Kind regards,

Aidan

StepChange_Aidan

pennypuppy said:

Hello, a family member has offered a full & final amount on my behalf and it was accepted. Please can I check if the wording from them is ok? I just want to make sure they don't come after/ sell on the remainder. ....
'We're delighted to let you know we can accept the following amount to settle xxxx's account;

Reference: xxx

Amount: xxxx

When paid, if the account is reporting on her credit file, we'll send an update so that this shows as "partially satisfied"

We will send an update to the credit reference agencies to show the above account has been paid & closed upon receipt of the above payment.

Credit file updates can take up to 8 weeks.'

Thanks

Hi,

This seems to be a standard response – The creditor has confirmed that they will accept your offer to settle the account and mark the debt as ‘partially satisfied’ on your credit report.

Usually a full and final settlement is an end to the matter and you shouldn’t have any further contact from the creditor or collection agencies about this debt. However, we would recommend that you keep copies of any correspondence for at least six years after you’ve paid the settlement amount, just in case.

There’s some more information on making settlement offers here.

I hope this helps.

Aidan

Donk2

Hi, I have £18000 debt on cards, overdraft. Never thought I would hear myself say that. I was more sensible. I suffer with mental health issues which have been made worse by years of debt pressure. My wife also suffers,and we are finding it hard to cope. Personally I'm now on max dose  of medication for anxiety. We have a mortgage  with decent equity, but can't remortgage for some time, and we can't get extra lending on mortgage because I have 0% interest debt on some cards.the situation is becoming desperate, I'm considering an iva, but think that consolidating with mortgage  would be a better option? Should have done it when we renewed , but we were a bit worried. Now it seems like the best option but we are unable to ,at least until April at the earliest. Don't know how we can last that long mentally and financially. Any help advice greatly appreciated

StepChange_Aidan

Donk2 said:

Hi, I have £18000 debt on cards, overdraft. Never thought I would hear myself say that. I was more sensible. I suffer with mental health issues which have been made worse by years of debt pressure. My wife also suffers,and we are finding it hard to cope. Personally I'm now on max dose  of medication for anxiety. We have a mortgage  with decent equity, but can't remortgage for some time, and we can't get extra lending on mortgage because I have 0% interest debt on some cards.the situation is becoming desperate, I'm considering an iva, but think that consolidating with mortgage  would be a better option? Should have done it when we renewed , but we were a bit worried. Now it seems like the best option but we are unable to ,at least until April at the earliest. Don't know how we can last that long mentally and financially. Any help advice greatly appreciated

Hi,

Thanks for your post. I’m sorry to hear how you’re feeling and I hope we can help.

Consolidating debts into your mortgage is rarely a good option if you’re in financial difficulty, as you would be turning the unsecured credit cards into secured debt against your property. You would also increase the long-term cost.

An IVA may be a better solution, but we’d need more details about your financial situation so that we know that it’s right for you. Alternatively, have you considered a Debt Management Plan (DMP) to reduce the monthly payment to your unsecured debts? 

I’d recommend getting in touch with us so we can put together a budget and review your options. You can get advice using our online debt help tool or give us a call to speak with an advisor.

I hope this helps.

Aidan

holly1985

Hello, my partner is on a dmp and as he placed a joint account on their it has severely impacted my credit score (which we were not advised would happen) I have £13k of credit card debit which I was paying off by doing 0% balance transfers and paying as much as possible. But since the dmp of my partner I now can no longer do this and now I’m paying high interest rates which means I can only afford to pay the minimum on each card. Around a year ago I spoke to the three credit card companies to see if I could reduce the interest or balance transfer all onto my lowest interest card and all three said no. Using the tools on this website I have looked to see if I can balance transfer or obtain a loan and I have 0% chance of both. How do I try to reduce the interest I am paying so that I can pay more towards my debt. I am managing to pay my bills (just) but just want to be debt free as quickly as possible and the interest rates are severely holding me back doing this. Any suggestions would be most appreciated 

StepChange_Allen

holly1985 said:

Hello, my partner is on a dmp and as he placed a joint account on their it has severely impacted my credit score (which we were not advised would happen) I have £13k of credit card debit which I was paying off by doing 0% balance transfers and paying as much as possible. But since the dmp of my partner I now can no longer do this and now I’m paying high interest rates which means I can only afford to pay the minimum on each card. Around a year ago I spoke to the three credit card companies to see if I could reduce the interest or balance transfer all onto my lowest interest card and all three said no. Using the tools on this website I have looked to see if I can balance transfer or obtain a loan and I have 0% chance of both. How do I try to reduce the interest I am paying so that I can pay more towards my debt. I am managing to pay my bills (just) but just want to be debt free as quickly as possible and the interest rates are severely holding me back doing this. Any suggestions would be most appreciated 

Hi Holly

Thanks for posting.

I'm sorry to hear what's happened here. It's our standard practice that on every call and in all our advice booklets, we explain that including any debt in any debt solution will impact a credit score, so I'm not sure what's happened. This is very basic advice. If you both feel this wasn't done, you can raise a complaint so that we can listen to the call and investigate this.

From what you've explained, it sounds as though perhaps you've been treading water a little with the debts already. Unless you're expecting an improvement in your finances soon, perhaps a debt solution may be best for you as well. 0% balance transfers can work well for a time, but when the debt gets to certain levels, it's often very difficult to get the total down, even with no interest.

We can provide advice free of charge on our Freephone number 0800 138 1111. Please have your income, spending and debt details to hand when you call, and we'll do everything we can to help.

Best wishes

Allen

grimsby_fan

Hello,

I currently have debts of around 20k spread over two credit cards plus an overdraft. I have always felt in control of my finances until recently but unfortunately I had my work hours and therefore wages cut over the summer due to the pandemic and I had to borrow even more on the credit card to make up the difference as unfortunately I don’t have any savings.

My main concern is paying my two credit cards off. I have always taken advantage of 0% balance transfer offers to keep my repayments at a minimum but now these interest free periods are coming to an end and my debts are starting to pile up. Despite having an excellent credit rating, I’ve been refused credit cards recently and I no longer think I’m able to get a good enough 0% credit card anymore due to very weak affordability. Therefore I don’t think I can continue transferring my balance to a 0% card and need an alternative solution instead.

I did have a plan to borrow more money against my property which has plenty of equity in it but unfortunately the bank refused this request due to a lack of affordability for the monthly repayments.

I currently pay around £72 a month on one credit card which has a balance of around £7000 and is still in an interest free period until next summer. I’m happy to continue paying this for now whilst it is in a 0% period but will need to move this money next summer.

Until recently I paid around £124 a month on my other credit card which has a balance of around £12000 but that is now set to increase to £289 a month now that the interest free period is over. It is this extra interest and higher repayment that is mostly concerning me.

Whilst I can just about afford the minimum repayments, I would prefer not to have to pay so much interest every month so would like to hear what alternatives are available.

I’m open to the idea of a DMP but I’m not convinced it’s the best option to me at this point and I’m worried about the affect it will have on my credit rating in future.

Any advice would be greatly appreciated!

Kind regards,

Andy

StepChange_Allen

grimsby_fan said:

Hello,

I currently have debts of around 20k spread over two credit cards plus an overdraft. I have always felt in control of my finances until recently but unfortunately I had my work hours and therefore wages cut over the summer due to the pandemic and I had to borrow even more on the credit card to make up the difference as unfortunately I don’t have any savings.

My main concern is paying my two credit cards off. I have always taken advantage of 0% balance transfer offers to keep my repayments at a minimum but now these interest free periods are coming to an end and my debts are starting to pile up. Despite having an excellent credit rating, I’ve been refused credit cards recently and I no longer think I’m able to get a good enough 0% credit card anymore due to very weak affordability. Therefore I don’t think I can continue transferring my balance to a 0% card and need an alternative solution instead.

I did have a plan to borrow more money against my property which has plenty of equity in it but unfortunately the bank refused this request due to a lack of affordability for the monthly repayments.

I currently pay around £72 a month on one credit card which has a balance of around £7000 and is still in an interest free period until next summer. I’m happy to continue paying this for now whilst it is in a 0% period but will need to move this money next summer.

Until recently I paid around £124 a month on my other credit card which has a balance of around £12000 but that is now set to increase to £289 a month now that the interest free period is over. It is this extra interest and higher repayment that is mostly concerning me.

Whilst I can just about afford the minimum repayments, I would prefer not to have to pay so much interest every month so would like to hear what alternatives are available.

I’m open to the idea of a DMP but I’m not convinced it’s the best option to me at this point and I’m worried about the affect it will have on my credit rating in future.

Any advice would be greatly appreciated!

Kind regards,

Andy

Hi Andy

Welcome to the forum and thanks for posting.

I can understand that you're in a tricky spot right now. To be honest, this is often the final outcome when people repeatedly do 0% balance transfers, unless there's an improvement in their financial situation.

The good news is that there are things you can do to get things under control, and we can help with that. You can contact us free of charge to go through a budget with us, and we'll provide you with details of all your available options. There are no obligations, and you'll be fully free to choose the solution that you feel best meets your needs.

Details of how to get in touch can be found here: www.stepchange.org/contact-us

I hope that's helpful.

Allen

Carlywales76

Hi folks ☺ 
Newbie here, just starting the process of getting to grips with my debt and stepchange plan,ie, contacting creditors etc, 
I have 2 queries ? I received 800 recently from a ppi claim , which has paid bills etc, I have kept back 200 as I stupidly went with black pearl claims company who have been working on the claims for a few years, yes I know nudity, but as a stress headed dyslexic, easier. Earlier this year had 1000£ but finally got annoyed at paying fee did some research about the company,  kicked off politely and the manager agreed to reduce the % from 40 to 20 % , new government guidance. Used to pay rent as husband wasn't earning in the summer,but is now...
So same situation I owe 200 £ , I am no currently working!!5 weeks now!!! But waiting clearance on 2 jobs, I have 16£ in credit card debt and 10 k owed on my car. 
Can I put the fee on my debt stepchange?...? Can't find the answer anywhere, and a bit worried about using the money to pay council tax etc ? .? Would they be a creditor or do I just pay them??

2nd very stress 😪......had a lease car through work, arranged to return it beginning of the year as couldn't make payments,  went tin the summer,  bought a newish one with zopa more freedom.  The employer an NHS  Trust and management agreed set payments to clear with cancellation fees 900£. I had a big breakdown in the summer and was forced to return to work,  very limited alternatives, so left end of October for new career. They took 330£ from my last wages, I had been liaising with them up to the day before about arranging payment,  but they took this in a lump sum and left me in debt!!! No sympathy,  sent an invoice for over 600£ , 5 weeks on demanding emails , 2nd invoice regarding amount from the lease finance department,  despite me advising no employment,  200 £ in bank for 1000£ bills, they emailed stating they cannot accept any non-payment,  now sent budget etc,advising  my situation and husband self employed impacted also... ..:(
*email Monday, which I can bearly read ,stating management agreed pay in January to June over 6 months,  being kind as giving me December as I haven't started, my new job?   Can they demand this, emails where aggressive and bullying despite me informing them of my mental health and financial difficulties?.? Would my union help or stepchange  ? I have never known this behaviour with others, and find this intimidating.? Help ?

Sorry long winded, takes me a while to ask for help, emu head in sand kinda girl 👧 😉 ,thanks in advance 
Carlywales76 

StepChange_Aidan

Carlywales76 said:

Hi folks ☺ 
Newbie here, just starting the process of getting to grips with my debt and stepchange plan,ie, contacting creditors etc, 
I have 2 queries ? I received 800 recently from a ppi claim , which has paid bills etc, I have kept back 200 as I stupidly went with black pearl claims company who have been working on the claims for a few years, yes I know nudity, but as a stress headed dyslexic, easier. Earlier this year had 1000£ but finally got annoyed at paying fee did some research about the company,  kicked off politely and the manager agreed to reduce the % from 40 to 20 % , new government guidance. Used to pay rent as husband wasn't earning in the summer,but is now...
So same situation I owe 200 £ , I am no currently working!!5 weeks now!!! But waiting clearance on 2 jobs, I have 16£ in credit card debt and 10 k owed on my car. 
Can I put the fee on my debt stepchange?...? Can't find the answer anywhere, and a bit worried about using the money to pay council tax etc ? .? Would they be a creditor or do I just pay them??

Hi Carly,

Thanks for your post and welcome to the forum.

If there’s a fee owed to a PPI claims management company, we would treat it as a non-priority debt, in line with your credit card and loan. If you’re setting up a Debt Management Plan (DMP) with StepChange, this debt can be added on.

Carlywales76 said:

2nd very stress 😪......had a lease car through work, arranged to return it beginning of the year as couldn't make payments,  went tin the summer,  bought a newish one with zopa more freedom.  The employer an NHS  Trust and management agreed set payments to clear with cancellation fees 900£. I had a big breakdown in the summer and was forced to return to work,  very limited alternatives, so left end of October for new career. They took 330£ from my last wages, I had been liaising with them up to the day before about arranging payment,  but they took this in a lump sum and left me in debt!!! No sympathy,  sent an invoice for over 600£ , 5 weeks on demanding emails , 2nd invoice regarding amount from the lease finance department,  despite me advising no employment,  200 £ in bank for 1000£ bills, they emailed stating they cannot accept any non-payment,  now sent budget etc,advising  my situation and husband self employed impacted also... ..:(
*email Monday, which I can bearly read ,stating management agreed pay in January to June over 6 months,  being kind as giving me December as I haven't started, my new job?   Can they demand this, emails where aggressive and bullying despite me informing them of my mental health and financial difficulties?.? Would my union help or stepchange  ? I have never known this behaviour with others, and find this intimidating.? Help ?

Sorry long winded, takes me a while to ask for help, emu head in sand kinda girl 👧 😉 ,thanks in advance 
Carlywales76 

If you’ve returned the lease car then the cancellation fee is also a non-priority debt and can be added to a DMP.

Creditors are entitled to send you letters or emails to demand payment, but you should only pay them back at a rate that you can afford. If you feel that the tone of the emails has been aggressive or that they’ve not taken your mental health situation into account, I’d recommend making a complaint to them.

StepChange will certainly be able to help you. If you need to add these debts to your plan or would like any further support, please get back in touch with us. 

I hope this helps.

Aidan