Advice for credit cards please

EssexHebridean

Goodness no absolutely do NOT borrow from family to pay consumer debt! 

Seriously - the advice given to simply stop paying is solid. The reason is that if you talk to them, they are highly likely to put "arrangement to pay" markers on your credit file - those hang about for a full 6 years once you have cleared that debt, whereas a default marker (the one you will get eventually if you stop paying entirely) stays on file for 6 years from the date it was applied. IN practise, this means:

You get an AP marker, and then take 3 years to clear the debt = AP marker stays on your file for 9 years
You get a default, and then take 3 years to clear the debt = default stays on your file for 6 years.

aderyn_tan

enthusiasticsaver said:

Unsecured debt is non priority debt which is why people are suggesting you do nothing. You will need redundancy money to tide you over to pay essential outgoings until you get another job. Essential outgoings are rent, utilities, council tax and food.  Don't be tempted to kick the can down the road by using your payout to cover unsecured debt. If you default then interest will be suspended and eventually you can sort out an affordable monthly payment when you are in a position to. I would not borrow from family. That just gives you more debt and you cannot borrow your way out. 

In all honesty if you have had £10k of debt for several years and done several BTs on to other cards then you have been over spending for some time and the redundancy is the catalyst to make you realise that. 

Thanks for this enthusiastic saver. I haven't had 10K of debt for several years, it has only got to 10K just now. But, nonetheless, you are right. I have been overspending for a long time, since Covid really. Even as I posted when asking the question, I thought very much along the lines of me "kicking the can down the road", or just getting into more debt. Thanks for the advice. 

aderyn_tan

RAS said:

Welcome, 

...
Secondly, you don't have the money to pay the minimums on your debts. So stop paying. Right now you need to accrue whatever emergency fund you can to deal with surprises and stuff like getting job interviews, not consumer credit.

In the short term it makes no difference if you stop paying completely, or make a token payment. In the longer term the token payments damage you credit record for longer than defaults. So aim for defaults. You'll get emails, phone calls and texts, computer generated. Just ignore them. The wheels of the debt collection industry move slowly.

Concentrate on housing, CT, food, utilities and other essentials. Cut back what you can but stop paying the cards.

Hopefully you'll be able to get back into work reasonably soon and you'll be able start paying once you've got a decent emergency fund behind you.

Thanks RAS, everyones advice has been really helpful. I don't have CT, I share a flat and the CT is included in my monthly rent. Thank you for your help, and everyone's, it's very reassuring.

RAS

Glad you are lodging.

Concentrate on housing, food ,(utilities if not included) and other essentials. Review you clothes, for example and identify what you wear, what you might need to wear in a new job ( a white shirt or black trousers?) and see if you can sell on the rest. 

Stop paying the cards and open a savings account. Aim for enough to leave your current accommodation, pay a month upfront and a deposit.