Help on loans

berri_2

Hello, 
My husband and I have loans and credit cards which is 50K we have been good payers until my husband lost his job so I called the bank for help. It has been a stressful process as an informal plan was in place for the loans then they say it was a technical fault our plan was cancelled anyway one of my loans will hit 4 consecutive months of not paying which sounds like it will then default so now my husband has a job I asked to set an arrangement so we can pay something off on each of the loans. 

3 hours later on the phone nothing was resolved as I was told we do not have enough disposable income it worked out we had £200 so I don’t understand why they can’t. 

I set up a plan with barclaycard as the employee was so helpful and went out of her way but Barclay loans have to be dealt with separately now I don’t know what to do so any advice appreciated.

fatbelly

Yes the two organisations seem quite separate.

One default is not the end of the world. It may be best to let it default, get passed to another agency an then deal with them. At least you can be sure that interest is frozen if it gets to that stage.

If you are banking with Barclays, now is the time to move away. There are lots of better banks out there, and deals to be had

https://www.moneysavingexpert.com/banking/compare-best-bank-accounts/

berri_2

I didn’t even think of moving away from Barclays as been with them for years. I thought defaulting would be the worst thing to do it’s worrying. Don’t they request you pay back in full which makes no sense when asked for help in the first place. 

Has anyone done a resolve loan? 

fatbelly

There are standard letters that get sent out ahead of a default. On dfw we regard them as good things because you can then start to make headway on repaying the debt, being taken out of the terms and conditions and generally passed to someone who's going to be more helpful than the original creditor.

You owe no loyalty to Barclays so to avoid the right of set-off I suggest you switch.

Lots of people have done debt consolidation. Not many successfully

EssexHebridean

For a loan, nobody is going to come along and demand that you pay it back in full just because you have a default,. You're getting confused with overdrafts I suspect, which CAN be called in with zero notice. 

Absolutely do NOT consolidate - there are almost no circumstances where it's a good idea (see also "selling property to pay off debt" on this one, too). 

You say that you have worked out that you have sufficient disposable income but Barclays reckon you haven't - are you certain that your figures are realistic? Have you checked that Barclays have your up to date income including your husband's new job? (Assuming you want to go down the line of sharing that amount of detail with them that is - you most likely don't have to, and it may well not be a good idea to do so.)

Just to be absolutely clear - the reason people are suggesting you need to ditch Barclays is as simple as this - you both presumably get your income paid into a Barclays account, the same one the loan has NOT been paid from? If so, be aware that Barclays can come along on payday, say "Oh, thanks" and remove a chunk of money to pay what you owe them. This is the right of set-off that Fatbelly mentioned above. 

berri_2

I spent about 3 hours on the phone to Barclays we went through expenses and income and they told me I had disposable income. They wanted to use the whole of that on 2 of my loans but I argued it needs to cover my husbands 2 loans aswell. The lady didn’t really have a clue and cut me off so I called back wanting to talk to someone else but she was locked into my account so I had to go back to her. 

Now I’m at a lose. Even if I change our account it doesn’t help with repaying the 4 loans. I already have a plan for barclaycard paying £32 a month. I hoped I could do something similar so we can get back on our feet and not pay so much on debt as that’s why we are in the mess, getting credit to pay other debt 

sammyjammy

berri_2 said:

I spent about 3 hours on the phone to Barclays we went through expenses and income and they told me I had disposable income. They wanted to use the whole of that on 2 of my loans but I argued it needs to cover my husbands 2 loans aswell. The lady didn’t really have a clue and cut me off so I called back wanting to talk to someone else but she was locked into my account so I had to go back to her. 

Now I’m at a lose. Even if I change our account it doesn’t help with repaying the 4 loans. I already have a plan for barclaycard paying £32 a month. I hoped I could do something similar so we can get back on our feet and not pay so much on debt as that’s why we are in the mess, getting credit to pay other debt 

You can, you just work out how much YOU can afford to pay them without putting yourself into more difficulties and you start paying it, you can write them a letter showing the your income and outgoings if you want to show the affordability.  You do need to move that account first though.

You are making the mistake of thinking you have to do what they tell you to do.

fatbelly

Because Barclays are so incompetent you may find that you are making a reduced payment and it does not cover the interest and charges they are continuing to apply.

At the very least get a freeze confirmed before paying them anything

See Essex's comments about not consolidating and leaving Barclays, and my previous comments about defaulting having positive benefits

sourcrates

Spending time on the phone attempting to deal with such things can be pretty much fruitless, as you have discovered.

Banks are not there to make payment arrangements that are lucrative to anyone but themselves, you are wasting your time trying to do so, they have neither the time nor resources to manage delinquent accounts for long, which is one reason why they have an in-house collections department.

However, there degree of discretion over what should be an acceptable payment level, is mostly in line with the parent company, so again, of little use to you.

Much better for you to wait, until they sell on your indebtedness, to another specialist company, who deal with these matter`s everyday.

They will be much more agreeable, and usually have no problem accepting whatever you can offer.

So I am on the same page as the others on this one, get a new bank account to avoid any risk of set-off, and wait until Barclays default your loans and sell them on, which in time they will do.

Graham1982

Hello everyone:

This is a question and NOT advice. Could a combination of the two be done i.e. change bank accounts BUT put a little into the bank account each month (the amount you could comfortably afford to pay the debt) then if they use this in a set off, it reduces the overall debt once sold and if they don't set it off then you can use it to reduce the debt manually?

Thanks

Graham

PS Again I assume someone will come along and say this is a bad idea and provide a legitimate reason as to why, alas I repeat, this is a question and I am not offering advice.

Brie

@Graham1982

It's an idea I like if only because I feel like I should pay the debts I have run up.  Not everyone agrees with that old fashioned logic.

I think though the objection will be that if the OP owes £50k and manages to delay this being sold on by paying a small amount monthly the total may actually increase due to fees & interest (assuming these are not waived).  So the sold debt might be £60k and the company buying it may agree to a settlement for £20k.  Or they may pay for a couple of years a total of £5k before it gets sold on  and may still end up with a settlement figure of £20k.

If they pay nothing, the debt is sold quicker, a settlement figure is decided quicker and the £5k they might have paid Barclays will be available to pay towards this final figure.