I'm in trouble

Houndog6105

I have lost my job due to becoming disabled after having 3 back operations and my income has reduced by quite a bit and I have a large amount of debt totalling about 24k with a large monthly outgoing towards these debts

I have never missed a payment on anything but I'm really struggling now and I want to know if I go to all of my creditors and explain my situation will they reduce my payments at all by quite a bit if possible or should I look at alternative options?

I spoke to credit fix who advised me to take out an IVA and I know I'm struggling but if they can at least reduce the payments to half of what I'm paying I can manage and not absolutely destroy my history and add an IVA to my report

Monthly outgoings towards debt are as follows

RBS loan £325
ZOPA loan £150
Barclaycard card £175
First direct £55
Virgin card £65
Aqua £55
Creation finance £38

Total £863

fatbelly

All creditfix do is IVAs and that is how they make their money. So it's no surprise that that's what they recommended. There are probably better options but we'll need more info.

Can you fill in a statement of affairs and post it?

https://www.lemonfool.co.uk/financecalculators/soa.php

Houndog6105

fatbelly said:

All creditfix do is IVAs and that is how they make their money. So it's no surprise that that's what they recommended. There are probably better options but we'll need more info.

Can you fill in a statement of affairs and post it?

https://www.lemonfool.co.uk/financecalculators/soa.php

Hello

Yes I'll get that done right away
Thankyou

enthusiasticsaver

If you are unemployed then realistically finding more  than £800 a month to service debts is not going to happen so I strongly suspect some sort of debt solution like a DMP or even bankruptcy/IVA may have to be considered. An soa will confirm but whether you go down the debt solution route or creditors agree to accept reduced payments your credit history will be affected.  That will not be the worst thing in the world though as you look as if you are heavily committed debt wise so more borrowing is the last thing you should be thinking about.  Do you have a property or mortgage?  You should be prioritising mortgage/rent, utilities and food above all else.  Paying for unsecured lending should only happen if you can cover essential outgoings.

An soa is a good start. 

Houndog6105

fatbelly said:

All creditfix do is IVAs and that is how they make their money. So it's no surprise that that's what they recommended. There are probably better options but we'll need more info.

Can you fill in a statement of affairs and post it?

https://www.lemonfool.co.uk/financecalculators/soa.php

I have posted the expenditure form twice but it keeps getting removed for some reason

fatbelly

Posting for Houndog:

Household Information[/b]

Number of adults in household........... 4

Number of children in household......... 2

Number of cars owned.................... 0[b]

Monthly Income Details[/b]

Monthly income after tax................ 0

Partners monthly income after tax....... 0

Benefits................................ 2100

Other income............................ 0[b]

Total monthly income.................... 2100[/b][b]

Monthly Expense Details[/b]

Mortgage................................ 0

Secured/HP loan repayments.............. 0

Rent.................................... 795

Management charge (leasehold property).. 0

Council tax............................. 45

Electricity............................. 50

Gas..................................... 50

Oil..................................... 0

Water rates............................. 45

Telephone (land line)................... 0

Mobile phone............................ 20

TV Licence.............................. 0

Satellite/Cable TV...................... 0

Internet Services....................... 30

Groceries etc. ......................... 400

Clothing................................ 0

Petrol/diesel........................... 60

Road tax................................ 0

Car Insurance........................... 0

Car maintenance (including MOT)......... 0

Car parking............................. 0

Other travel............................ 0

Childcare/nursery....................... 0

Other child related expenses............ 0

Medical (prescriptions, dentist etc).... 0

Pet insurance/vet bills................. 25

Buildings insurance..................... 0

Contents insurance...................... 0

Life assurance ......................... 0

Other insurance......................... 0

Presents (birthday, christmas etc)...... 0

Haircuts................................ 20

Entertainment........................... 20

Holiday................................. 0

Emergency fund.......................... 0[b]

Total monthly expenses.................. 1560[/b]

[b]

Assets[/b]

Cash.................................... 0

House value (Gross)..................... 0

Shares and bonds........................ 0

Car(s).................................. 0

Other assets............................ 0[b]

Total Assets............................ 0[/b]

[b]

No Secured nor Hire Purchase Debts[/b]

[b]Unsecured Debts[/b]

Description....................Debt......Monthly...APR

RBS loan.......................8500......325.......0

ZOPA loan......................3000......150.......0

Virgin credit card.............2236......65........0

Creation finance...............1388......38........0

Aqua card......................1500......65........0

Barclaycard....................4670......175.......0

First direct credit c..........1727......55........0[b]

Total unsecured debts..........23021.....873.......-  [/b]

[b]

Monthly Budget Summary[/b]

Total monthly income.................... 2,100

Expenses (including HP & secured debts). 1,560

Available for debt repayments........... 540

Monthly UNsecured debt repayments....... 873[b]

Amount short for making debt repayments. -333[/b]

[b]Personal Balance Sheet Summary[/b]

Total assets (things you own)........... 0

Total HP & Secured debt................. -0

Total Unsecured debt.................... -23,021[b]

Net Assets.............................. -23,021[/b]

Houndog6105

enthusiasticsaver said:

If you are unemployed then realistically finding more  than £800 a month to service debts is not going to happen so I strongly suspect some sort of debt solution like a DMP or even bankruptcy/IVA may have to be considered. An soa will confirm but whether you go down the debt solution route or creditors agree to accept reduced payments your credit history will be affected.  That will not be the worst thing in the world though as you look as if you are heavily committed debt wise so more borrowing is the last thing you should be thinking about.  Do you have a property or mortgage?  You should be prioritising mortgage/rent, utilities and food above all else.  Paying for unsecured lending should only happen if you can cover essential outgoings.

An soa is a good start. 

If I got some sort of help on reducing the payments from my creditors and I'm still making monthly minimum payments can I ask why my credit history is effected still please as I thought so long as I'm making payments and never miss a payment then my history is ok.

Yes my circumstances have changed and yes my income is lower so reduce my limit and hit my score fair enough but why is my history effected if I've never missed a payment?

TheAble

Houndog6105 said:

enthusiasticsaver said:

If you are unemployed then realistically finding more  than £800 a month to service debts is not going to happen so I strongly suspect some sort of debt solution like a DMP or even bankruptcy/IVA may have to be considered. An soa will confirm but whether you go down the debt solution route or creditors agree to accept reduced payments your credit history will be affected.  That will not be the worst thing in the world though as you look as if you are heavily committed debt wise so more borrowing is the last thing you should be thinking about.  Do you have a property or mortgage?  You should be prioritising mortgage/rent, utilities and food above all else.  Paying for unsecured lending should only happen if you can cover essential outgoings.

An soa is a good start. 

If I got some sort of help on reducing the payments from my creditors and I'm still making monthly minimum payments can I ask why my credit history is effected still please as I thought so long as I'm making payments and never miss a payment then my history is ok.

Yes my circumstances have changed and yes my income is lower so reduce my limit and hit my score fair enough but why is my history effected if I've never missed a payment?

I wouldn't stress too much about your credit history. The last thing you want to be doing is borrowing any more money.

Could the other 3 adults in the household help you out at all?

elsien

TheAble said:

Houndog6105 said:

enthusiasticsaver said:

If you are unemployed then realistically finding more  than £800 a month to service debts is not going to happen so I strongly suspect some sort of debt solution like a DMP or even bankruptcy/IVA may have to be considered. An soa will confirm but whether you go down the debt solution route or creditors agree to accept reduced payments your credit history will be affected.  That will not be the worst thing in the world though as you look as if you are heavily committed debt wise so more borrowing is the last thing you should be thinking about.  Do you have a property or mortgage?  You should be prioritising mortgage/rent, utilities and food above all else.  Paying for unsecured lending should only happen if you can cover essential outgoings.

An soa is a good start. 

If I got some sort of help on reducing the payments from my creditors and I'm still making monthly minimum payments can I ask why my credit history is effected still please as I thought so long as I'm making payments and never miss a payment then my history is ok.

Yes my circumstances have changed and yes my income is lower so reduce my limit and hit my score fair enough but why is my history effected if I've never missed a payment?

I wouldn't stress too much about your credit history. The last thing you want to be doing is borrowing any more money.

Could the other 3 adults in the household help you out at all?

That was my thought as well. Presumably  they’re either earning or on benefits so does your SOA reflect their contribution towards household expenses? 

flipflopflo

Who are the other 3 adults in your household? Are the children yours?

An IVA is definitely not suitable for you as you have no assets to protect. What ever debt solution you go for you will be getting defaults as you are £300 short of funds to make minimum payments. 

gozaimasu

@Houndog6105

https://www.stepchange.org/how-we-help/debt-relief-order.aspx

As previously advised, don't go for IVA. You might want to choose a debt relief order instead. Get in touch with Step Change and they'll walk you through all the steps you need to take to help with your debts.