Debt Management or not?

twisty37

I'm trying to get rid of £17500 of unsecured debt which I can service with a struggle. Most of my borrowings are at high rates because I have an old loan default on my credit file that will (finally) fall off my report in January 2008.

Other than the default and a couple of late payments for cards over the last 2 months, which have been a real struggle, my file is fairly clean. My dilemma is this:

Should I go for debt management with CCCS, who have been really helpful. This will mean I can sleep at night, meet my commitments, but harm my record.
OR
Hang on until the new year, when the default is gone from my record, and then attempt to refinance at a more reasonable rate (I'm paying between 18 and 32%). This way I could reduce payments (possibly) and not harm my record, but I risk waiting another 10 weeks to try this and in the meantime I am sailing close to the wind.

I've already cut my living costs to the bone, cancelled PPI, etc, so I am at the stage where I need to decide which way to go, and would welcome any advice.

pania

Hi There twisty, wellcome and well done for posting. It would seem a shame that after waiting 6 years to finally be shot of a default that you then incurr more.
How about seeing if you can bolster your income for the next 2 months with either some bar work, avon or similar to get you over that hump?

Let us know a little more about your scenario too, we may be able to give you some more advice on where to cut back or how to shuffle the finances a little to your benefit?

Hugs to you and pop back soon.
Pania
xxx

Sea78

hi,

welcome Hope that you are ok. I agree with Pania that we need to see a little more about your incomings/outgoings to really know if a DMP would be best for you - it certainly has helped me!

Sea xxx

twisty37

Thanks for your comments, it really does help to get another point (or points) of view.
My situation is that I take home £1400, and currently make repayments of £605 on credit card and loan payments. I have a particularly expensive 7500 loan from citifinancial at 32%, a 5500 loan to AIB at 22%, plus assorted credit cards (worst 2000, citi - 33%, best AIB 300 18%).
The remaining £795 is divided between rent (£400) and the remaining £395 has to cover everything else. Sometimes it works, sometimes not but I do odd bits of work to cover the shortfall.
The last 2 months have seen a *lot* of late payments and charges (my bank managed to charge me £240 in a week last month, about half of which I managed to get repaid after some negotiation).
I am a month behind with one loan repayment, citibank are prepared to look at the repayments but it would mean longer term etc and be expensive in the long run.
I applied to my own bank for refinancing, but they declined, which was a shame as I could have saved 250 a month, so that search will appear on the record.
In a debt management arrangement, theres obviously going to be a credit report hit, but is it worth the short term pain when you dont want any more credit anyhow. Seems very tempting....I just dont know. Help!!!!

chevalier

Hi there. Is there anything you can ebay to give you an injection of cash.Is there any space on the AIB card for you to transfer any of the other debt, as it would save you money in interest payments. Can you get overtime at your work, or work in a bar or other social area so you get out, but they pay you? Anything really to get a preferably weekly hit of money?

There are also survey sites you can earn money on like lightspeed. Or if you are a bit brainy there is AQA of which there is a thread on here somewhere.

regards
chev

I_was_a_fool

If you do not have a mortgage, or worry about losing your home, I would go for the DMP with CCCS. I dug myself a very deep hole with re-financing & re-financing again, before finally being forced into the dmp & I wish I had done it years before. Every attempt to refinance left me with not enough to live on, carrying on the borrowing/charges cycle, until I could not afford to pay the interest never mind anything off the capital.