Struggling with debt? Ask a stepchange debt adviser a question

fortspies

Me and my partner in a state of panic and desperation last year spoke with CreditFix and agreed to an IVA of £150 a month for 32K of debt instead of being smart and speaking to stepchange. Live and learn. 

We’ve been paying this with no issue, but a change of circumstances now means we’re likely to pay way more now when it comes to our annual review and the IVA isn’t viable at that point as there’s no saving for us. 

We have worked out that in reality if we get out of this we can save until it fails between 7-10k and make F&F settlement offers to the big creditors as soon as they are able to talk to us, as well as being able to do this with all the other debts practically month in month out, leaving us out of debt nearly 3 years quicker meaning we could save upwards of 15K by the time the IVA drops off our credit report.

We don’t have a house and only 1 low value car between us so believe unlikely to be made bankrupt as they’ve got nothing to gain from it.

Is this a smart move? A friend who is an accountant has worked with me on the figures and believes this is the better choice.
 

fatbelly

fortspies said:

Me and my partner in a state of panic and desperation last year spoke with CreditFix and agreed to an IVA of £150 a month for 32K of debt instead of being smart and speaking to stepchange. Live and learn. 

We’ve been paying this with no issue, but a change of circumstances now means we’re likely to pay way more now when it comes to our annual review and the IVA isn’t viable at that point as there’s no saving for us. 

We have worked out that in reality if we get out of this we can save until it fails between 7-10k and make F&F settlement offers to the big creditors as soon as they are able to talk to us, as well as being able to do this with all the other debts practically month in month out, leaving us out of debt nearly 3 years quicker meaning we could save upwards of 15K by the time the IVA drops off our credit report.

We don’t have a house and only 1 low value car between us so believe unlikely to be made bankrupt as they’ve got nothing to gain from it.

Is this a smart move? A friend who is an accountant has worked with me on the figures and believes this is the better choice.
 

You should get an answer on Monday. Don't forget you can post on the main board too.

StepChange_Aidan

fortspies said:

Me and my partner in a state of panic and desperation last year spoke with CreditFix and agreed to an IVA of £150 a month for 32K of debt instead of being smart and speaking to stepchange. Live and learn. 

We’ve been paying this with no issue, but a change of circumstances now means we’re likely to pay way more now when it comes to our annual review and the IVA isn’t viable at that point as there’s no saving for us. 

We have worked out that in reality if we get out of this we can save until it fails between 7-10k and make F&F settlement offers to the big creditors as soon as they are able to talk to us, as well as being able to do this with all the other debts practically month in month out, leaving us out of debt nearly 3 years quicker meaning we could save upwards of 15K by the time the IVA drops off our credit report.

We don’t have a house and only 1 low value car between us so believe unlikely to be made bankrupt as they’ve got nothing to gain from it.

Is this a smart move? A friend who is an accountant has worked with me on the figures and believes this is the better choice.
 

Hi,

Thanks for your post.

If you haven’t already, I’d suggest contacting CreditFix first, as they will be able to review your situation if there’s been a change in circumstances and talk you through your options.

If it’s clear that it’s no longer a suitable solution, you can ask them to terminate your IVA. This can take a few months, and once completed you will receive a termination certificate.

Making the settlement offers seems like the best move if it will save you money and get you debt free sooner, but I’d need more details to be certain. Unfortunately, StepChange are unable to offer debt advice to people on an active IVA. After you've received your termination certificate, please get in touch if you’d like to review your options with us.

Regards,

Aidan

1stbaby

Can StepChange help if you are self employed?

sourcrates

1stbaby said:

Can StepChange help if you are self employed?

No, post on the main board for debt advice.

StepChange_Aidan

1stbaby said:

Can StepChange help if you are self employed?

Hi,

I’ve also posted in your other thread.

StepChange aren’t able to support self-employed people. If your partner would like to review his options with a debt advisor, we would recommend Business Debtline for specialist help.

https://www.businessdebtline.org/

Regards,

Aidan

aderyn_tan

Hi,

I am £10K in credit card debt, and have recently been made redundant. For the last couple of years, I've 0% balance transferred some credit cards and stayed on-top of my payments.  Things have been tight for the last few months, what with the cost-of-living-crisis etc, and I was talking with one of my credit cards to give me some time to work things out just before being made redundant. This has compounded my situation, and I've just missed a payment on that card - its on my credit file. 

So, I've done a budget with yourselves and as I am still waiting to see how much I will get paid from Universal Credit (I will know at the beginning of December) I put my income at £0. This gave me one recommended option of a Payment Suspension. Could I please ask, do you think this is the best way forward for me?

I've registered with yourselves and done my budget (though I need to edit the yearly electricity as I must have put my yearly outgoings as my monthly) and I have also completed an SOA for this forum. My salary before redundancy was just under £26K, and as already mentioned, I was managing until just lately. I guess I am worried that for the foreseeable future, on Universal Credit, I will unable to afford the minimum payments across all of my cards and that things will spiral out of control, along with all that might ensue. Bailiffs etc! I want to do my best to prevent that.

I can share my SOA with you (not sure how to do that on here yet) and my Step Change report as and if required. For any other readers, I'm yet to post on Debt Free Wannabe proper, as it takes me some time to write these posts.

Thank you

RAS

Duplicate post, also on DFW.

StepChange_Aidan

aderyn_tan said:

Hi,

I am £10K in credit card debt, and have recently been made redundant. For the last couple of years, I've 0% balance transferred some credit cards and stayed on-top of my payments.  Things have been tight for the last few months, what with the cost-of-living-crisis etc, and I was talking with one of my credit cards to give me some time to work things out just before being made redundant. This has compounded my situation, and I've just missed a payment on that card - its on my credit file. 

So, I've done a budget with yourselves and as I am still waiting to see how much I will get paid from Universal Credit (I will know at the beginning of December) I put my income at £0. This gave me one recommended option of a Payment Suspension. Could I please ask, do you think this is the best way forward for me?

I've registered with yourselves and done my budget (though I need to edit the yearly electricity as I must have put my yearly outgoings as my monthly) and I have also completed an SOA for this forum. My salary before redundancy was just under £26K, and as already mentioned, I was managing until just lately. I guess I am worried that for the foreseeable future, on Universal Credit, I will unable to afford the minimum payments across all of my cards and that things will spiral out of control, along with all that might ensue. Bailiffs etc! I want to do my best to prevent that.

I can share my SOA with you (not sure how to do that on here yet) and my Step Change report as and if required. For any other readers, I'm yet to post on Debt Free Wannabe proper, as it takes me some time to write these posts.

Thank you

Hi,

Thanks for your post. I can see that you’ve already had plenty of good advice in your other thread.

Payment suspension is the option we typically recommend if your budget shows little or no money available. It’s an informal way of just putting your debts on hold until your situation improves. 

When you know how much you’ll be receiving from Universal Credit, I’d recommend going back to update your budget, as there could other long-term solutions that are available.

Whatever you decide to do, please bear in mind that your priority bills (such as rent/mortgage, council tax, utility bills) and your essential living costs are far more important than the debts. Don’t be pressured into paying anything to the credit cards if you can’t afford to do so.

It’s unlikely that these debts will end up with bailiffs, but even if they did the creditors would have to go through a number of steps before they reach that stage. The collection process varies depending on where in the UK you live. There’s a guide here.

I hope this helps,

Aidan

Sheepherder_36

Hi all,

Thanks for taking the time to read and respond to my query. A very happy new year to one and all!

I completed my DMP in September 2023 and all debtors were settled. One of the debts was to utility warehouse regarding an account I had with them previously and the sum value of the paid debt via the DMP was circa 1K. They had liaised with stepchange on multiple occasions regarding the outstanding debt amount and had worked with them toward resolution via the DMP process.

To my surprise yesterday I received a letter from them stating that I had an outstanding amount of over £1300 on another separate electricity account that I had with them for a different property I was renting. At no point during the course of discussion with myself or stepchange in the DMP process did they ever get in touch to say about this outstanding amount nor did they declare this seperate account to stepchange or myself. I had known about the account previously and had asked them specifically to merge the two accounts together so that the debt sum could be paid off via the DMP. I was assured that this would be done but evidently it hasn't been.

Understandably I am pretty anxious about the letter and have rung them but they have been of little help other than asking for old statements from me regarding another account matter. 

My question is are they legally allowed to declare this account debt now that the DMP has been resolved as surely they should have declared it previously during their discussions with stepchange and myself so as to be transparent and open. It is a real kick in the teeth compounded by the fact that they have also informed me it is registering as an outstanding payment of over 6 months on my credit file along with the DMP thus hindering me moving forward.

All advice most welcome, and thank you again.