Treading water, but the debt is winning...

enthusiasticsaver

I would forget about the debts and don't add to the debts by taking a loan from a relative even if they say it is an early inheritance.  If they are elderly there is such a thing as deprivation of assets which means if they gift money late in life and then need social care funding any disposal of assets may be questioned and you may be liable to repay. It won't help you  and creditors cannot force you to repay when you  do not have the income. Damaging your credit record for you would actually be ok as borrowing more is the last thing you should do. 

The bigger problem is the fact that you have insufficient income to cover your outgoings.  

stu12345_2

it looks like your rent is too high for what the DWP class as acceptable. i know over the years they have lowered it and lowered it forcing folk to move area or rent a bedsit in a rough area.

if your rent was fully paid for , at least you would have enough to live on,just 

then you can concentrate on your debts, eg telling your creditors you have nothing to give them at all.
then look for other debt solutions , maybe a DRO

Stu4rt

@sourcrates Thank you for your advice. The biggest hinderance in obtaining a DRO is that I will need to be able to be a director of a business legitimately without having my shareholding / directorship under anyone else's name. I also need to protect the fact I have always worked in financial services and will again at some point need to be FCA accredited which I would not qualify for either in an IVA, DRO or if my credit file was drastically damaged. 

If it was as simple as taking a hit for 6 years, I can stomach that, but I cannot also stomach my ability to work in the industry where I am able to earn money without starting again from scratch. 

freshstart2023

In terms of the FCA accreditation, it’s a tough pill to swallow. I have worked my whole life in financial services and have recently resigned at 40 to start again in another field so that I can concentrate on becoming debt free. I have treaded water for the last 10 years because of my job but it just wasn’t sustainable any longer. 

PurpleMouse5

So I think the biggest issue is getting income to cover your essential costs. Then the second one is how to get out of the debt situation, and I understand you don't want to jeapordise your future work to do that. 

So I don't think you have to decide about the debt right now. If you just write to them and explain your situation, then either stop paying or send token payments of £1 per month. The debts will default, but it's unlikely more will happen as you don't have any assets to protect. The default will stay on your credit record for 6 years, and you might want to get advice about the impact on a financial services job, but it's probably less of an impact than a DRO.
 It sounds like your situation would need to change for you to be able to pay off this credit even on a debt management plan. So a DRO might be the right option. But you can spend some time working out your options and not much will happen from the creditors in the meantime.  

 Whether you make token payments or get a DRO it will be very difficult to get more credit in the medium term. So the bigger worry is how do you meet your essential costs next month. It sounds like you need to try and get some specialist benefits advice. And yeah it sucks so sorry to hear about the situation.  

sourcrates

Stu4rt said:

Hi all,
I am 36, currently unemployed and suffer with mental health issues. I have accumulated roughly £30K in debt across various high interest bearing credit cards, overdrafts and loans. 

Unfortunately, I have reached that critical mass where as of this month I can no longer borrow any more money or obtain any further credit to cover my bills.

Something has to give then huh, I remember when I myself was in a similar position, approx. 20 years ago now, wife was ill, couldn`t work, my income was stagnant, credit was all maxed out, difficult choices had to be made.

This debt is a chain around your neck, and you will not settle it for 15k, your lenders will not offer discount as I said previously, you are still contracted to repay the full amount, unless you default and it gets sold on, and in 2/3 years time you then make settlement offers, it might work, but not now.

What you are hoping for has no chance of working at this very early stage.

You cannot have your cake and eat it, ultimately the choice will be out of your hands as non payment will lead to defaults and debt collection, that train will already be rolling, the question is are you going to take steps to resolve this matter or rely on someone else's bailout.