Credit card debts

sourcrates

Looking4silverlining said:

tigergambit said:

Looking4silverlining said:

tigergambit said:

If you have already set up your new, clean bank account and cancelled your DDs do you have anything to say to them? I suspect it's best to sit tight and let them get on with their default processes. Speaking to them will probably just delay this.

Try not to let this run your life. Set all the letters aside and deal with them for 30 minutes once a week. If you really have to do something set up a filing system for the letters and a summary spreadsheet so that you have contact details and state of play all in one place.Otherwise just sit back and build that emergency fund.

I was just a bit concerned about the overdrafts as they are different from credit card debt. I wasn't sure how it worked with unnaranged overdrafts, that's all.

If a bank has chosen to make a payment that takes you into an unarranged overdraft then I would suggest that's their mistake and their problem. 

I'm sure someone will correct me if I'm wrong but the only difference I am aware of between O/D and CC debt is that an O/D can be withdrawn at any time and CCA rules don't apply. Once you go down the DMP route you can treat them the same although O/Ds are enforceable whereas CC or loan debt may or may not be. 

Asking for CCAs is some way in the future for you, so don't worry.

The bank has chosen to pay itself from my account but it put me into a unarranged OD Basically I have a bounce back loan with them and there wasn't enough for the monthly payment so they took it out anyway. I thought if you didn't have sufficient funds the thing would simply bounce. Oh well

It doesn't matter in the long run, the account will eventually be closed, interest will be frozen, and a default will be registered, you may choose to repay via a DMP, and then further down the line, settle the debt for around 40% of what is owed.

These things tend to balance themselves out.

Looking4silverlining

sourcrates said:

Looking4silverlining said:

tigergambit said:

Looking4silverlining said:

tigergambit said:

If you have already set up your new, clean bank account and cancelled your DDs do you have anything to say to them? I suspect it's best to sit tight and let them get on with their default processes. Speaking to them will probably just delay this.

Try not to let this run your life. Set all the letters aside and deal with them for 30 minutes once a week. If you really have to do something set up a filing system for the letters and a summary spreadsheet so that you have contact details and state of play all in one place.Otherwise just sit back and build that emergency fund.

I was just a bit concerned about the overdrafts as they are different from credit card debt. I wasn't sure how it worked with unnaranged overdrafts, that's all.

If a bank has chosen to make a payment that takes you into an unarranged overdraft then I would suggest that's their mistake and their problem. 

I'm sure someone will correct me if I'm wrong but the only difference I am aware of between O/D and CC debt is that an O/D can be withdrawn at any time and CCA rules don't apply. Once you go down the DMP route you can treat them the same although O/Ds are enforceable whereas CC or loan debt may or may not be. 

Asking for CCAs is some way in the future for you, so don't worry.

The bank has chosen to pay itself from my account but it put me into a unarranged OD Basically I have a bounce back loan with them and there wasn't enough for the monthly payment so they took it out anyway. I thought if you didn't have sufficient funds the thing would simply bounce. Oh well

It doesn't matter in the long run, the account will eventually be closed, interest will be frozen, and a default will be registered, you may choose to repay via a DMP, and then further down the line, settle the debt for around 40% of what is owed.

These things tend to balance themselves out.

Thanks for all of your help, Ive really no idea what is going to happen.
I do have a further question though.
What if I can't improve my situation and what if I can't save any kind of fund to offer and full and finals (I think they are called) Can I simply keep paying what I can afford for 6 years then it will all disappear? 

sourcrates

You misunderstand, debts never just disappear, debts remain until paid, settled or written off.

They show on your credit file for 6 years, but if you have been making payments, they are still active and due.

You are confusing matters with the limitation act, for that to apply there must be 6 clear years of non payment for a debt to become statute barred.

Looking4silverlining

sourcrates said:

You misunderstand, debts never just disappear, debts remain until paid, settled or written off.

They show on your credit file for 6 years, but if you have been making payments, they are still active and due.

You are confusing matters with the limitation act, for that to apply there must be 6 clear years of non payment for a debt to become statute barred.

Oh so everyone must be just assuming that I am going to be able to save up money to make the settlements. Im not sure that Im ever going to be in a situation to save. Im struggling to buy shoes or get my teeth sorted etc etc, don't know how I would ever get to save anything to be honest. So the 6 year thing doesn't really matter then if Im never going to be able to pay them off, it will always be on my credit file Im guessing as I can't just stop paying them can I.  

sourcrates

Well yes of course you can just stop paying, what else can you do if you don`t have the money?

It was suggested to you in an earlier post that if the situation was so dire that the debt will never be repaid, or take an excessively long time to repay, you should ask the creditors to consider taking a commercial approach and writing the debts off.

Debt management is designed to allow you to save an emergency/settlement fund, alongside making reduced payments to your debts, obviously this will only work if you have sufficient disposable income in the first place.

If you don`t have sufficient income to service a DMP, then your only alternative is insolvency such as a DRO or bankruptcy, but this will only suite non homeowners, if you own a house, or bankruptcy will cause issues in other aspects of your life, then a token payment strategy will work as a temporary fix, with a view to obtaining write offs at a future date.

There are no magic fixes, its up to you to choose a strategy that meets your needs, then work towards achieving it.

EssexHebridean

If you do enter into a DMP then the 6 year thing is irrelevant for the purpose of clearing the debt. It might be worth you having a bit of a read of the DMP Long Haul support  thread - it’s either a pinned post at the top on this board or it’s on diaries, I can’t recall which. There are folk there who’ve been working at paying DMPs for many years though - you can simply keep paying until the debts are cleared if you’re not in a position to make F&Fs. Don’t be daunted by it though - DMPs that long aren’t all that common!

Allowing for how long defaults are likely to take to appear these days, the usual hope is that the gap in time while you are paying nothing to the debts allows you to build firstly an emergency fund, and then that fighting fund we talk about. Also, when you put together the SOA which lets you work out what you have available to pay to the debts via the DMP, you should also be budgeting for continuing payments to the EF - as otherwise it will dwindle over time and you’ll end up having problems. The idea is that the £50 a month or whatever you continue to pay to it helps stop that happening. 

Looking4silverlining

sourcrates said:

Well yes of course you can just stop paying, what else can you do if you don`t have the money?

It was suggested to you in an earlier post that if the situation was so dire that the debt will never be repaid, or take an excessively long time to repay, you should ask the creditors to consider taking a commercial approach and writing the debts off.

Debt management is designed to allow you to save an emergency/settlement fund, alongside making reduced payments to your debts, obviously this will only work if you have sufficient disposable income in the first place.

If you don`t have sufficient income to service a DMP, then your only alternative is insolvency such as a DRO or bankruptcy, but this will only suite non homeowners, if you own a house, or bankruptcy will cause issues in other aspects of your life, then a token payment strategy will work as a temporary fix, with a view to obtaining write offs at a future date.

There are no magic fixes, its up to you to choose a strategy that meets your needs, then work towards achieving it.

Ok understood.

Altior

Have you explored taking other employment where the income is more regular and stable than self employment? Given you live in a ULEZ area and your van is not compliant it must be costing you a lot to run  and the income you get from self employment is not high. What about your tax and NI situation? Do you owe money there? 

This was asked on the thread but may have been missed as I don't believe a definitive response was put forward?. Reading through the thread, this would seem like the simplest solution out of the debt hole. Even a minimum wage job full time will pay over £20K take home, and living within ulez there are literally thousands of these. 

It's not clear to me why the OP would still pursue the self employment dream when it evidently can't pay the bills. Or it should be possible to do both, for example work nights and do the self employment stuff during the day. If you drive a van then something like supermarket home deliveries might be an option, or small parcel deliveries. But there must be dozens of options, in an employees' market living in a ulez zone...

I lurk on so many of these threads and very rarely is the income side of the ledger pursued as vigorously as it might/should be. Some people aren't in a position to possibly do this of course, but that doesn't obviously appear to apply to this thread. 

Looking4silverlining

Altior said:

Have you explored taking other employment where the income is more regular and stable than self employment? Given you live in a ULEZ area and your van is not compliant it must be costing you a lot to run  and the income you get from self employment is not high. What about your tax and NI situation? Do you owe money there? 

This was asked on the thread but may have been missed as I don't believe a definitive response was put forward?. Reading through the thread, this would seem like the simplest solution out of the debt hole. Even a minimum wage job full time will pay over £20K take home, and living within ulez there are literally thousands of these. 

It's not clear to me why the OP would still pursue the self employment dream when it evidently can't pay the bills. Or it should be possible to do both, for example work nights and do the self employment stuff during the day. If you drive a van then something like supermarket home deliveries might be an option, or small parcel deliveries. But there must be dozens of options, in an employees' market living in a ulez zone...

I lurk on so many of these threads and very rarely is the income side of the ledger pursued as vigorously as it might/should be. Some people aren't in a position to possibly do this of course, but that doesn't obviously appear to apply to this thread. 

There are lots of reasons that I want to stay where I am on the self employed front. Ive just moved back to London, and have just spent months on my new business idea which seems to be gathering pace with lots of interest and some good leads. I have a dog so can't do long days and quite often I take him with me. I did have a very good self employed job, hence owning the pooch.
Partner sickness is why I ended up getting into debt and then having to care for my elderly mum for 2 years. Now I am trying to get back to where I was before.
I don't owe any tax and am exempt from paying any National Insurance at the moment.
I am 55 and not in good shape so could never do a daytime then evening job. Anyway....the dog.

Altior

These are choices, perhaps difficult ones, but they are choices. There are loads of options in 2024, even working from home if you have a dog. Obviously I'm not familiar enough with your personal circumstances to know what they all are. Long story I won't go into now but I had to look after the family dog for many months, I live alone with no garden. Yes it meant taking him out in the morning before going to work, coming home to walk him for my lunch, getting in the door after work and taking him out again before I sat down. But it can be done. 

Just on the numbers I fear that the income side of the ledger won't be enough to support your lifestyle, even if the unsecured debts were eradicated in the short term. But evidently you have your heart set on making a success of the new business idea, instead of seeking a guaranteed regular income employment alternative that would cover the monthly liabilities. It feels like that's a choice rather than necessity, one that can be ill afforded however I can definitely see that it might feel difficult to give up on the preferred option. 

Anyhow for some reason being critical about excessive expenses is perceived as perfectly acceptable on this board, however being critical about the income side of things being insufficient feels like it is frowned upon. Just to be clear anyway, my intervention on the thread is not intended to be overly harsh, when I read these threads I tend to think what would I do in this scenario (aside from the technical debt management stuff!). And this one was definitely ratchet the income via regular paid employment.