Support needed enough is enough

debtmonkey123

Hi everyone, It has taken me so long to finally pull my head out of the sand.

11 accounts unsecured borrowing totalling £85,228.

I have only been able to pay minimum payments until recently when I had to start withdrawing money from CC for day to day spending.

This has really woken me up to do something.

I have been in touch with step change who have recommended a debt management plan. 

I was going to start with them but after reading previous posts I am really considering to do it myself.

There are hundreds of threads which date back years I have tried to understand exactly what I need to do.

1. Let all accounts default this can take months.
2. Should get a letter confirming the debt has been defaulted.
3. Wait to hear from company who takes over the debt and then arrange an amount with that company.
4. Ignore all threats of court or demands for full payments.
5. After a few years should be offered a discounted value to repay the debt.

Can someone confirm if I have missed anything, in the earlier posts there is a lot of talks about sending letters. Looking at more recent posts there is no need to send letters?

Thank you in advance for any support with this.

RAS

Point 4

You will get a lot of letters which say they may "refer your case to the pre-legal team", or that the consequences may include legal action. Defaults by law have to include a demand that you repay the entire debt, before they can issue a default.

You ignore those.

If you get a letter before action or court papers, you respond promptly. Come here for advice.

Grumpelstiltskin

OK 1 and 2 correct,

3 Ask for a CCA from the company before you think about paying anything.

4 As RAS says you must open any snail mail letters in case there is a letter before action.

5 Correct.

I will add something else, when you stop paying save as much money as you can for an Emergency Fund. You will need this in case your car fails it's MOT the same week as the washer breaks and you have no access to credit to pay these things

debtmonkey123

RAS said:

Point 4

You will get a lot of letters which say they may "refer your case to the pre-legal team", or that the consequences may include legal action. Defaults by law have to include a demand that you repay the entire debt, before they can issue a default.

You ignore those.

If you get a letter before action or court papers, you respond promptly. Come here for advice.

Thank you so much for your prompt advice

debtmonkey123

Grumpelstiltskin said:

OK 1 and 2 correct,

3 Ask for a CCA from the company before you think about paying anything.

4 As RAS says you must open any snail mail letters in case there is a letter before action.

5 Correct.

I will add something else, when you stop paying save as much money as you can for an Emergency Fund. You will need this in case your car fails it's MOT the same week as the washer breaks and you have no access to credit to pay these things

Thank you so much for your advice, what is a CCA please.

Great idea about emergency fund

Grumpelstiltskin

CCA Information is here.

National Debtline | Sample letters - Information about your agreement under the Consumer Credit Act | National
 Debtline

You don't need to send £1 

It doesn't apply to over drafts and phone contracts etc, but OK for loans and credit cards etc.

If they can't supply it ( or the original creditor ) then you can just not pay it.

debtmonkey123

Just thinking about self managing 11 different accounts do you think it will be too much as it is my first time doing g something like this thanks again 

Grumpelstiltskin

If you are waiting for defaults  and then waiting for CCAs coming back enforceable you won't start with 11, in fact if you don't get CCAs you won't end up with 11 so don't worry about being overwhelmed.

debtmonkey123

Grumpelstiltskin said:

If you are waiting for defaults  and then waiting for CCAs coming back enforceable you won't start with 11, in fact if you don't get CCAs you won't end up with 11 so don't worry about being overwhelmed.

Thank you just didn't want to make a mistake 

sourcrates

debtmonkey123 said:

Just thinking about self managing 11 different accounts do you think it will be too much as it is my first time doing g something like this thanks again 

You managed to pay your bills before you got into debt, so its not your first time, its just the same, except you will be paying less, and probably to different creditors.

Pre-preparation is everything, once you re-start payments, you can either set it all up in internet banking, so its just a case of 11 clicks every month, or do it manually on individual company websites.

That will be the full extent of your involvement, 15 mins a month to self manage the average DMP.
Nothing more to do.

DisabledDan

debtmonkey123 said:

Hi everyone, It has taken me so long to finally pull my head out of the sand.

11 accounts unsecured borrowing totalling £85,228.

I have only been able to pay minimum payments until recently when I had to start withdrawing money from CC for day to day spending.

This has really woken me up to do something.

I have been in touch with step change who have recommended a debt management plan. 

I was going to start with them but after reading previous posts I am really considering to do it myself.

There are hundreds of threads which date back years I have tried to understand exactly what I need to do.

1. Let all accounts default this can take months.
2. Should get a letter confirming the debt has been defaulted.
3. Wait to hear from company who takes over the debt and then arrange an amount with that company.
4. Ignore all threats of court or demands for full payments.
5. After a few years should be offered a discounted value to repay the debt.

Can someone confirm if I have missed anything, in the earlier posts there is a lot of talks about sending letters. Looking at more recent posts there is no need to send letters?

Thank you in advance for any support with this.

I can show you a list of all the "autoresponder" letters but there might be a better way.

If you have no money or assets, e.g. on benefits and have no likely chance for that position to change in the next year, then why not consider a DRO or bankruptcy (I think for over £50k it has to the latter).

It is a nuclear option but so is waiting out the debt for 6 years and then a further 6 years for those that try for a CCJ.

Your credit record is done for so why not explore the bankruptcy thread on this fine forum and see what works for you.

I did not take that route but in some ways I wish I did.

I will PM you a tip if you do decide to follow the route you define.

I can also tell you the letters you will get from the players my debt was passed to, note it gets passed to a new firm around every three months.  The offers start off low, they are followed by a number of letters to threaten you or to give you FOMO, the best offer comes just before the debt is passed to the next debt abuser.    Traditionally the debt goes as high as 60% off but when my debt as assigned to new companies to own the debt it went as high as 90% off.  I owed a similar amount to you and I paid zero to anyone.

The question you need to honestly ask yourself is "why is this happening and will it happen again", I can only mention my own known causes of which there are two.

1. For some people debt is like gambling, I paid off my ex's debt so many times as did her family, but she has a mental health disease which somehow made her feel more secure if spending money (usually on things she did not need).  That compelled her to just get new cards and start the whole horrid process again until there was nothing left.  I paid £60k of her debts, then more when the divorce came, then her family bailed her out I think 6 times. I think on the last few bail outs they did it conditionally on her having counselling for depression and anxiety.

2.There can be a life changing event that ends your ability to earn or ever pay off the debt.

There is no judgement here, the objective of the lender is to put you in a place where you can afford to service the debt but not afford to clear the debt.  They keep people paying huge interest, some move their debt to just another TLA debt management programme until there is an intervention moment such as you have now..