Help required .... In a Mess!

kimwp

Thank you for re-doing your SOA. You really need to add in all your expenses- groceries, presents, literally everything you spend. Otherwise you won't have a good understanding.

Do you know how you got into debt? If your SOA is accurate, then you had approx £1200 for groceries, presents etc when your salary reduced, so shouldn't have been building up debt. You don't need to share it, but you do need to understand it, to avoid drifting back into debt again.

Knotintherope

The personal loan company are quick of the mark …. The three separate loans payments are spread over the month, the 1st one not due until the 13th and I’ve been texted already about the direct debit being changed! (Cancelled) This is obviously the start of it!

sourcrates

Knotintherope said:

The personal loan company are quick of the mark …. The three separate loans payments are spread over the month, the 1st one not due until the 13th and I’ve been texted already about the direct debit being changed! (Cancelled) This is obviously the start of it!

Standard generic response to a cancelled DD, don`t panic.

400ixl

Does your wife know about these debts? (not meant to be judgemental, but can mean different approaches to tackling the problem).

You really need to tackle these as a partnership and both be willing to make sacrifices to get this sorted IMO. Both from a joint commitment to strike out costs and for the mental support.

Ideally your SOA needs to include everything from an income and outgoing perspective. That gives the full picture of the issues. How you use any disposable income (if any) is a different matter but it at least gives the full picture.

You Sky package looks like you have taken every bundle possible and are out of contract. I would start with driving that down to the bare minimum which would likely save you £100 per month to use.

You now have one car in the SOA and you pay towards the insurance and tax, but not to any maintenance or fuel.

You have buildings insurance, but nothing in contents, is that because it is included in the buildings cost?

Knotintherope

So this week is the first my creditors will be looking for money because direct debits (which I’ve cancelled) and credit card payments are due …. So I just appear to have fallen off the face of the earth and ignore calls/texts/emails etc or do I make any sort of contact … bearing in mind they have know idea this is about to happen other than minimum payments over the last while and DD’s being cancelled?

sourcrates

No, don`t tell them at thing, it only slows the process down.

Your goal is to get your accounts defaulted and sold on, so interest stops, so just let the collection process do its thing, carry on as per normal, its no big deal.

Granted for someone doing this for the first time, it all seems strange, as if your going against the grain, not sure what the reaction will be etc etc, all perfectly normal thoughts.

You just have to trust that what your being told is the best way to get what you want.

Knotintherope

Thank you @sourcrates … it is daunting but feeling positive 

Knotintherope

@EssexHebridean

Once the DDs have stopped you will be using the gap between stopping payments and the defaults being given to save any surplus  for an EF and perhaps also a “fighting fund” for full and finals down the line. That is ALL you should be doing with surplus though - no being tempted to buy things “while you can!” 

Love this piece of advice / reminder that although I have money (in theory) the debt is still real and the need for an EF and a "fighting fund" is greater than the many temptations that seem to pop up! 

EssexHebridean

Knotintherope said:

@EssexHebridean

Once the DDs have stopped you will be using the gap between stopping payments and the defaults being given to save any surplus  for an EF and perhaps also a “fighting fund” for full and finals down the line. That is ALL you should be doing with surplus though - no being tempted to buy things “while you can!” 

Love this piece of advice / reminder that although I have money (in theory) the debt is still real and the need for an EF and a "fighting fund" is greater than the many temptations that seem to pop up! 

I’m glad it struck a chord as a good reminder! It’s incredibly easy to slip into a trap of thinking “I should probably just buy this, this, oh and that, now, while I’ve got the money” without remembering that the pot of money you have built up is firstly your safety net if things go awry while you are in the DMP (although in the event of a real emergency  that will cost more than you have in your EF there are options!) as well as being your best shot at getting out of that DMP sooner as well. 

I would definitely urge anyone to continue saving a small amount each month to bolster those funds even when the DMP is underway. It’s entirely reasonable to budget a small amount for emergency fund savings each month. 

Knotintherope

Update... From February to now ... Numerous phone calls/Texts/Emails and letters all at different levels of threats of might do this or this could happen. Stayed strong and maintained radio silence and finally over the last couple of days two have changed to DEFAULT status (Payplan & Vanquis). Novuna x3, Tesco, Virgin, Amex & MBNA still to go.
Are my two defaults likely to be sold or how and when do I start to payments?
Thanks Guys