Struggling with debt? Ask a stepchange debt adviser a question

DesperateDeb

https://forums.moneysavingexpert.com/discussion/comment/81938096#Comment_81938096

thanks since posting I’ve been in touch with Step change and I’ve filled in all my information in the hope of setting up a DMP.

esj13

https://forums.moneysavingexpert.com/discussion/comment/81929361#Comment_81929361

I just wanted to return and say that I have (kind of) got all my ducks in a row this week as I have had time off work and actually listed all my debts one by one and completed the online forms and given StepChange a full breakdown of my debts, financial responsibilities and my income. Currently I have around £200 a month left over after essential expenses, which gives me a couple of options, according to StepChange;

1. Debt Management Plan - based on current amounts owing and income this would take me 33 years to repay.
2. IVA - Initially the system said this wasn't recommended due to my job, but I wasn't really sure how it would affect my job, so I said I was unsure, but looking through my employment contract, it does not state that I am not allowed to be insolvent at any time during my employment.

How would an IVA affect my house? Currently it is owned by my partner and myself and we have a mortgage on it. This is my current main concern when choosing an option to tackle this debt. Also how will it impact me when my fixed rate comes to an end?

Fortunately my partner is understanding and has offered to support me through this, which includes paying additional payments when possible if on a DMP.

I have not chosen an option yet, but will be calling SC tomorrow to discuss the best course of action.

But does anyone here have anything that might be helpful?

I also want to say, to anyone who might be reading and going through a similar situation; talk to your partners. I was constantly under stress trying to intercept the post so that I could hide letters so my partner would not find out. This morning it got too much and I had a breakdown and the full extent of the situation came spilling out. I had been feeling extremely ashamed and embarrassed of myself, but, once it was out it was the biggest relief ever. Now I feel more able to breathe, which makes it easier to address because I don't have to pretend it doesn't exist any more.

SpireCaptain

https://forums.moneysavingexpert.com/discussion/comment/81990597#Comment_81990597

100% agree with this, I've not told my partner as we're splitting up (partly due to debt and the reason I got into it) but telling my Mum, my sister and even customers on my round that I consider friends has been such a weight off myself boulders after 8 years of silently coping but I knew the physical harm the constant stress has caused alongside the mental strain. This forum over the past 2 years has been my sanctuary. I wish you well in your journey. I'm yet to start mine but only a few months left to rob Peter to pay Paul so to speak.

sourcrates

@esj13

You have posted in the stepchange debt advisors thread, if you want advice from the collective, please start a new post in the general DFW forum.

StepChange_Aidan

https://forums.moneysavingexpert.com/discussion/comment/81990597#Comment_81990597

Hi,

Your home would be protected in an IVA, and your mortgage wouldn’t be included. However, it may be more difficult to remortgage when your fixed term ends, or you might not be offered the best deals. The Insolvency Practitioner (IP) will discuss this with you in more detail before the IVA goes ahead.

There’s some more information about how an IVA can affect your home and mortgage here.

I hope that when you called in, the advisor you spoke to was able to help you decide on the best course of action, but please get back in touch with us if you have any further questions or concerns.

Regards,

Aidan

smit1978

Hi, I am knew to this all. I guess the first thing to say is I have been stupid and basically spent beyond my means. I am not in debit crisis yet but I want to address this before I get in deeper. I have approx 26K worth of Credit Cards debts plus some loans. Now while some CC's are on 0% that will run out. One is not and is costing £ 380 per month and I can't switch as obviously any CC company think I will take that and then rack the other up again. Basically at the moment I have about £1000 a month disposable income. I have no idea if that is a lot but I always get to the end of the month scraping my overdraft.
I have a mortgage on approx 50% of the value of my house. The easy option would be to move and just pay off the debts but myself and my partner want to avoid that if possible.
I have reduced all the Direct Debits I can to a minimum.

I am open to any other suggestions or advice

StepChange_Aidan

Hi,

Thanks for your post. Please don’t be so hard on yourself, you’re trying to address the issue now before it becomes more serious.

Is the £1,000 per month disposable income how much you have left after you’ve covered the minimum payments to the debts, or before? We would need more details to be able to give specific advice, the first step is to create a budget so we can fully understand your situation. If you’d like to create one with StepChange you could use the Debt Advice tool on our website or give us a call to speak with an advisor.

Regards,

Aidan

ianw87

Hi,

I bought my first property in December last year. With the adjustment of having bills to pay again etc. I recently took out two loans - one for £1800 and another for £1000. I already had a loan which I bought my car with, the settlement agreement is £9400.

The loans were for a holiday and purchases for the property, but now I'm realising that I have little left over each month for savings / christmas / birthdays / emergencies and general month to month expenses.

I can manage the payment, but I'm considering a consolidation loan to A) reduce the monthly payments and B) have one clear payment to make each month.

I know this is my fault and I've been stupid / frivolous, but having read a bit, think this could be a good solution as I can stick to the one monthly payment and clear the rest.

Any advice?

StepChange_Aidan

https://forums.moneysavingexpert.com/discussion/comment/82012207#Comment_82012207

Hi Ian,

I wouldn’t typically recommend consolidation loans, as it’s taking on more debt and you’re likely to end up having to repay more in the long run.

We have a guide to debt consolidation here.

Are you able to afford the contractual payments to the existing loans and still cover your priority bills and living expenses? If not, I would usually suggest a Debt Management Plan to manage your debts. You could then make one reduced payment each month which is then shared fairly among your creditors.

There could be other debt solutions that are more appropriate for your situation. If you’d like to review your options with StepChange you could use our online Debt Advice tool.

I hope this helps,

Aidan