Struggling with debt? Ask a stepchange debt adviser a question

Mooeyboy

Hi,

I hope you may be able to help with a couple of questions I have. 

When I initially had my advice session with SC, I as advised that my current bank wouldn’t try to take my monthly salary as an offset,  while I was receiving help ( I have an overdraft and a credit card with them) However I spoke with SC again today, and I’m  now advised that the bank may try to do so, and that I should move my money to another account I have. Do you know how likely they may try to do this? 

I was also told today to remove myself from a current account held in both my and my wife’s name, as there is an overdraft ( that we rarely use) attached to it.  I was initially told I didn’t have to do this, as we didn’t really use it. So I’m a bit confused with the conflicting advice. 

Any advice would be appreciated. 

StepChange_Allen

Mooeyboy said:

Hi,

I hope you may be able to help with a couple of questions I have. 

When I initially had my advice session with SC, I as advised that my current bank wouldn’t try to take my monthly salary as an offset,  while I was receiving help ( I have an overdraft and a credit card with them) However I spoke with SC again today, and I’m  now advised that the bank may try to do so, and that I should move my money to another account I have. Do you know how likely they may try to do this? 

I was also told today to remove myself from a current account held in both my and my wife’s name, as there is an overdraft ( that we rarely use) attached to it.  I was initially told I didn’t have to do this, as we didn’t really use it. So I’m a bit confused with the conflicting advice. 

Any advice would be appreciated. 

Hi there

Thanks for posting.

I can appreciate why this advice may be conflicting, but can confirm that this is due to a recent change in what our debt advisors have been told to explain. I'll give a brief explanation.

Some time ago, we were advised by banks as a collective that if a customer was on an active debt solution that was managed by us, that they wouldn't look to use the right of offset. So as a result, people didn't need to be advised to move their banking elsewhere. However, since then, we have come across cases where the right of offset has been used, so we've had to revert to advising that there is a risk still there.

We stop at mentioning there is a risk without saying that you must change, it's ultimately up to you whether to change or not. I'd say that if you're on a solution that we're managing for you, and it's basic bank account, that it's unlikely they'll use it, but there's no guarantee. They'd also have to give 10 days' notice in writing of their intention to use it, so you should get chance to move the money or call them to ask them not to do so. It's just whether you want to completely eliminate the chance of this happening by banking with a company you have no debts with.

I hope this makes sense.

Allen

Mooeyboy

Hi Allen,

Thanks for the information, much appreciated. That’s made things a bit clearer. 

Can I ask one more question? I currently have a joint bank account with my wife ( not my or her main account- we both have separate)  and mortgage. I’ve been advised by SC to remove myself from the joint bank account, which I will do. I’ve checked with our mortgage lender, and they’ve advised they don’t check our credit rating prior to changing deals upon expiry,  so that sounds good too. 

I’m just wondering if you can advise what impact me going on a DPP may have to her credit file? 

Thanks again.

StepChange_Patience

Mooeyboy said:

Hi Allen,

Thanks for the information, much appreciated. That’s made things a bit clearer. 

Can I ask one more question? I currently have a joint bank account with my wife ( not my or her main account- we both have separate)  and mortgage. I’ve been advised by SC to remove myself from the joint bank account, which I will do. I’ve checked with our mortgage lender, and they’ve advised they don’t check our credit rating prior to changing deals upon expiry,  so that sounds good too. 

I’m just wondering if you can advise what impact me going on a DPP may have to her credit file? 

Thanks again.

Hi there

Thanks for getting back in touch.

It's great to hear that Allen helped make things a bit clearer for you and you've got a positive answer from your mortgage provider, hopefully I can help with your additional concerns. 

Your DMP will only affect people who you have joint financial products or joint debts with. This would be something like a loan, bank account or household bills that are in joint names. 

In this case there’ll be a ’financial association' linking your credit files. This means your record of making reduced payments may affect the other person’s credit file and their ability to get credit.

As you're looking to get your name off the joint bank account and if you maintain your payments to your mortgage, this should limit the impact on your wife's credit file.

I hope this helps, please come back if you have any further questions.

Patience

Mooeyboy

Hi Patience,

Thanks for providing that information. 

Jetjet_12

Hi! 

I have several questions if somebody can help me. I have recently done the assessment with StepChange and was advised to request for payment suspension from my creditors from an unsecured personal loan, overdraft and 4 credit cards. I have since then contacted my creditors and have sent my income and expenditure budget to each of them. Santander, who I bank with offered to give me 30 days suspension for the CC but i have not taken this up yet.
I also have an overdraft and a personal loan with them. Meanwhile, Barclays have given me 30 days suspension which I took while I have yet to receive correspondence from the other 2 which is MBNA and Virgin. 

My question are as follows:
1. None of my priority debts and nonpriority debts are in arrears hence when I spoke to Santander and Barclays they said they can't really offer me anything else other than a 30 day suspension as I am "coping" with paying my debts. I am now wondering whether I should just default on my payments so I can go to a DMP. The same with MBNA, which have told me I am not in arrears hence they cannot offer me anything else as of the moment. Should i just default so I can go to DMP? 

2. My main bank account is with Santander and I have an overdraft with them but I am thinking in 2 months time I might be able to come out from it. I also have a personal loan with them which only got a little over a year left for me to finish and I would prefer it if I would be able to pay it off rather than for it to be included in the DMP. Would that be possible? 

3. Would I need to switch to another bank? I have a basic one with Monzo. But I have also spoken to Santander and they said they would make a note on my account to say that I would prefer keeping my account despite me experiencing financial difficulties.

4. My husband and I have a joint savings account with a meager amount on it as we are also trying to save for his visa renewal early next year. Would we need to move our savings elsewhere or remove my name from the joint account? It is with Barclays with whom I have also a credit card debt. I don't want the risk of off setting the savings for my debt when we need it more for his visa.

On a side note, it is really the credit cards that is becoming unmanageable for me as the interests are so high that I am only making minimum payments on all 4 of them and it is only making the least amount of difference on the actual monies that I owe. This has been going on for a year and I am not getting anywhere with my payments hence I decided to seek some advice. 


Thank you for the help. 

StepChange_Allen

Mooeyboy said:

Hi Allen,

Thanks for the information, much appreciated. That’s made things a bit clearer. 

Can I ask one more question? I currently have a joint bank account with my wife ( not my or her main account- we both have separate)  and mortgage. I’ve been advised by SC to remove myself from the joint bank account, which I will do. I’ve checked with our mortgage lender, and they’ve advised they don’t check our credit rating prior to changing deals upon expiry,  so that sounds good too. 

I’m just wondering if you can advise what impact me going on a DPP may have to her credit file? 

Thanks again.

Hi there

I just wanted to add a comment re the mortgage situation to give further reassurance. If you simply move to a new deal with the same lender, with no additional borrowing, it just classes as a new product, not a re-mortgage, so a new credit check isn't required. If you wanted to borrow more, it'd be a re-mortgage, as would moving to a new lender.

It's worth bearing in mind that renewing with your current lender won't necessarily be the best deal out there, if there's no issues around credit checks.

Best wishes

Allen

StepChange_Allen

Jetjet_12 said:

Hi! 

I have several questions if somebody can help me. I have recently done the assessment with StepChange and was advised to request for payment suspension from my creditors from an unsecured personal loan, overdraft and 4 credit cards. I have since then contacted my creditors and have sent my income and expenditure budget to each of them. Santander, who I bank with offered to give me 30 days suspension for the CC but i have not taken this up yet.
I also have an overdraft and a personal loan with them. Meanwhile, Barclays have given me 30 days suspension which I took while I have yet to receive correspondence from the other 2 which is MBNA and Virgin. 

My question are as follows:
1. None of my priority debts and nonpriority debts are in arrears hence when I spoke to Santander and Barclays they said they can't really offer me anything else other than a 30 day suspension as I am "coping" with paying my debts. I am now wondering whether I should just default on my payments so I can go to a DMP. The same with MBNA, which have told me I am not in arrears hence they cannot offer me anything else as of the moment. Should i just default so I can go to DMP? 

2. My main bank account is with Santander and I have an overdraft with them but I am thinking in 2 months time I might be able to come out from it. I also have a personal loan with them which only got a little over a year left for me to finish and I would prefer it if I would be able to pay it off rather than for it to be included in the DMP. Would that be possible? 

3. Would I need to switch to another bank? I have a basic one with Monzo. But I have also spoken to Santander and they said they would make a note on my account to say that I would prefer keeping my account despite me experiencing financial difficulties.

4. My husband and I have a joint savings account with a meager amount on it as we are also trying to save for his visa renewal early next year. Would we need to move our savings elsewhere or remove my name from the joint account? It is with Barclays with whom I have also a credit card debt. I don't want the risk of off setting the savings for my debt when we need it more for his visa.

On a side note, it is really the credit cards that is becoming unmanageable for me as the interests are so high that I am only making minimum payments on all 4 of them and it is only making the least amount of difference on the actual monies that I owe. This has been going on for a year and I am not getting anywhere with my payments hence I decided to seek some advice. 


Thank you for the help. 

Hi there

Welcome to the forum and thanks for posting.

Okay so I'll tackle each question in order, but firstly my advice is to call back and discuss all of the above with a debt advisor. They will have full access to all your debts, budget and any notes and will be able to give you more tailored advice that I can based on your post.

1. A payment suspension is only suggested to someone when there is no money left at all to pay debts with after all household bills and essential living costs are covered. This means a) You can't afford to keep the payments going and b) There is also no money available to do a DMP with. So yes, based on that being your recommended solution, the payments should be stopped as you need the money to cover essentials.

2. It's important with any debt solution to include all non-priority debts, be they credit cards, loans, store cards, overdrafts etc. If you feel that you'd be able to come out of the overdraft quite soon, hopefully this improvement in circumstances was discussed with the debt advisor you spoke with, so that they could take this into account when advising you. It's hard to say much more without seeing your account.

3. You could use the Monzo account or if you want to stay with Santander, they may allow you to open a basic account with them and stop using the overdrawn one (which you need to include in your chosen debt solution). You should get some assurance from Santander they they won't use the right of offset first though. 

4. This is a good question. The right of set off doesn't allow money to be taken from a joint account and paid of an account in sole name, so from the information given, this wouldn't be possible. 

I appreciate the situation that you describe, it does sound as though you need to do something different. Again, I'd suggest calling back to discuss your above concerns with an advisor in order to get more tailored advice to your precise situation.

I hope this is helpful.

Best wishes

Allen

Jetjet_12

Hi Allen!

Thanks for getting back at me. Barclays has now gotten back at me and has sent me a termination notice. I will get in touch with StepChange and see what they advise.

Many thanks.

Kind regards,

Jet

enigomo

Hi, i need an advise about a Barclaycard debt. Back in 2016 i was taken to court, but the case was dropped on the court date,by the debt collection company working on behalf of Barclays. I haven't heard anything from them since, we moved house and today i received a letter (not sure if this is from the same people taking me to court, but it's most likely) Can they take me to court again after they have dropped the fist case and when does actualy the Limitation Act starts. I am really confused.

Thank you!