Help needed please 🙏

needtosortmylife

Hey all, so I’m £27000 in debt. I don’t have to explain why but I want to. Split from my ex husband of 24 years Feb 22, sold our house & actually paid off our £42000 worth of debt, I have 3 children, I work full time, I stupidly racked up more debt which I should not have done. 

Been lurking on here since April when I realised couldn’t pay the £900+ per month for my 2 loans & 3 CCs. I took your advice & cancelled DDs for all, not made any contact after 1000s of letters & calls, I’ve been waiting to default. I have now defaulted on 1 MBNA loan & 1 Tesco CC. Now I’m worried 😟 My aim is to pay it all off with a DMP.
I feel absolutely awful & like a complete failure. 

I don’t know what to do now. 

RAS

Join the club. Your story is not unusual. 

The starting point is going to be seeing if your current income covers your essential expenditure. So you need to do an Statement Of Affairs, as that is the only way of working out whether you have the money spare to fund a DMP. And if so, how much you might offer the defaulted creditors. Link in the bottom post amongst the Stickies.

And inevitably you are going to need to rein in spending going forward. Not an easy task with three children.

So get the statements out and work out what you gave been spending money on.

recklessmurmur

I wish I was more knowledgeable to offer some help, but I'm not. Just wanted to say that I'm in a similar position, and know the feeling all too well. First thing people will ask for is an SOA, so that's something to make a start with. You are not alone xxx

needtosortmylife

RAS said:

Join the club. Your story is not unusual. 

The starting point is going to be seeing if your current income covers your essential expenditure. So you need to do an Statement Of Affairs, as that is the only way of working out whether you have the money spare to fund a DMP. And if so, how much you might offer the defaulted creditors. Link in the bottom post amongst the Stickies.

And inevitably you are going to need to rein in spending going forward. Not an easy task with three children.

So get the statements out and work out what you gave been spending money on.

Thank you for your advice.

I have a fairly decent job (take home £2200 a month with £200 a month from UC) & can afford to pay my essential expenditures. I will have around £400 a month ‘spare’ leaving me £100 a week to live on or hopefully save. I appreciate I have to rein in the spending, I was living on my CCs for a long time due to a number of reasons. This is obviously no longer happening. This is what I was thinking…

MBNA CC £2549.13 

Pay £30 a month

MBNA Loan Defaulted 31/08 £8008.65 Pay £115

Barclays CC £3778.35 

Pay £45 a month

Tesco CC Defaulted 19/09 £4048.64

Pay £45 a month

Tesco Loan £9651.96 

Pay £115 a month 

Grumpelstiltskin

Don't pay any of the debts that haven't defaulted.

You need to save an emergency fund, something will break down and you won't be able to resort to credit.

You need to include some saving each month for emergencies so don't leave yourself short when you work out what you can afford to pay to your debts.

Read this thread and complete a SOA and copy and paste on here then we can check you have included everything..
In Debt and Wannabe Debt Free? first Steps to take are here, please read, then ask questions. — MoneySavingExpert Forum

RAS

Until we see that SOA it is difficult to advise.

The biggest problem with SOAs presented here is that the posters fail to make adequate provision for emergencies and for less frequent events. As a rule, if you have enough to live on and get side-swiped by unexpected costs, your SOA needs editing to make future provision.

Since you've stopped paying the consumer debt, hopefully you've been building a decent emergency fund. Since you are in rented accommodation you certainly need a month's rent and enough for a deposit, in case you are given notice to quit, plus moving costs. Then another pot with enough to replace white goods, etc.

sourcrates

needtosortmylife said:

Hey all, so I’m £27000 in debt. 

My aim is to pay it all off with a DMP.
I feel absolutely awful & like a complete failure. 

I don’t know what to do now. 

Well you have stated your intention to pay it off via a DMP.

Then two sentences later you say you don`t know what to do, what happened in those two sentences?

You need to remove feelings from the equation, its just business, a way to repay what you owe, at an affordable rate, its not Rocket science, and your not a failure, its just how the dice have rolled, nothing more.

I don`t always hold to SOA`s, simply because no two months are the same for most folk, so don`t linger too much on that, the figures given in your other post, as long as they are manageable, look fine to me for starters.

Two things you must do, one, wait until each account defaults, that way all interest stops, and your debts will be either assigned or sold, these companies accept lower payments than original creditors would, so whatever you can afford will be good.

Two, save an emergency fund, even £20/£30 quid a month will soon add up, as later on down the line, settlement offers will likely be coming your way, and you may want to take advantage of them.

Most of all, relax, once payment arrangements are in place, things settle down and it just becomes normal, the hope is you won`t turn to credit again should things go astray, try and stick to that hope.

needtosortmylife

Thank you all..I intended to save an emergency fund but haven’t saved anything, I suppose I buried my head in the sand & pretended it wasn’t happening. Now 2 debts have actually defaulted I’ve realised it has happened & I now want & need to to deal with it. 

I have looked at the SOAs & will complete later.
I have to start an EF as I literally have nothing to fall back on. 
I will honestly never ever get myself in this situation again. 

ManyWays

I will honestly never ever get myself in this situation again. 
The most important factor is how realistic your plan is, which is why we are asking to see the SOA, not to tell you you should live on beans on toast but because you may be planning to live on beans on toast and that isnt going to work. 

Floss

If you have stopped paying those repayments you can save some of that money into an Emergency Fund. Then use the SOA to form an accurate budget including everything & using bank statements to see how much your food shopping, bills, car costs etc really are.

needtosortmylife

	Amount (£)
Monthly Income (after tax)	2100
Partner's Monthly Income	0
Benefits	300
Other Income (Child maintenance £100 p/w, older sons rent £100 p/w)	866

Enter your monthly expenditure

	Amount (£)
Mortgage	0
Rent	1250
Management Charge (e.g. on leasehold property)	0
Council Tax	145
Electricity	70
Gas	70
Oil	0
Water Rates	60
Telephone (land line)	0
Mobile Phone (Mine & youngest son)	75
TV Licence	15
Satellite/Cable TV	55
Internet Services	25
Groceries etc.	100
Clothing	0?
Petrol/Diesel	100
Road Tax (car)	15
Car Insurance (including breakdown cover)	60
Car Maintenance (including MOT)	20
Car Parking	0
Other Travel	0
Childcare/Nursery	0
Other child related expenses (Dinner money & pocket money)	20
Medical (prescriptions, dentists, opticians etc.)	30
Pet Insurance/Vet bills	0
Building Insurance	0
Contents Insurance	8
Life Assurance	0
Other Insurance	0
Presents (birthday, christmas etc.)	0?
Haircuts	50
Entertainment	50
Holiday	0
Emergency Fund                         100?                     DEBTS  MBNA CC £2549.13  MBNA Loan Defaulted 31/08 £8008.65  Barclays CC £3778.35  Tesco CC Defaulted 19/09 £4048.64 Tesco Loan £9651.96