£31,000 Credit Card Debt and My Anxiety is Unbearable

RAS

That's it at this stage.

You don't have to do it what I suggest, but knowing your occasional/annual costs can be funded from the budgeting account and that you've got a safety buffer will make the journey much easier.

tigergambit

husnu1 said:

So to make sure I’ve understood everything from all the helpful comments:

1. The first step is to try not to panic and give myself some space to think, even though I’ve missed two months of credit card payments.

2. I should wait for the defaults to happen before taking any major action.

3. It’s okay to ignore the creditor phone calls, especially since they cause me a lot of anxiety. I’ve already blocked the numbers to avoid the stress.

4. There’s nothing to panic about right now. Nothing will escalate until the defaults start coming in.

5. It’s a good idea to open a couple of savings accounts to start putting money aside for emergencies and unexpected costs (like car repairs or gifts) and to give myself a safety buffer.

Have I got that right? Is there anything else I should consider or add to the plan?

Thanks in advance for all your help.

Yes, I think that's it.

Point 4: nothing escalates so long as you respond to their letter asking you to get in touch AFTER they default you. You simply write to them and tell them how much you will be paying. No negotiation, no discussion.

Pumpkinmad

My situation is quite similar to you, the difference being I think this is going to be the first month I actually can’t pay my minimum payments, a frightening place to be but need to take responsibility. What I’ve been trying to find out if if one of the credit cards I keep making my payments will that card provider let me keep the card or once they see defaults will they make moves to not allow me to use that card anymore? The idea of not having a credit card for a real emergency worries me. Good Lucy in your journey 

Grumpelstiltskin

Pumpkinmad said:

My situation is quite similar to you, the difference being I think this is going to be the first month I actually can’t pay my minimum payments, a frightening place to be but need to take responsibility. What I’ve been trying to find out if if one of the credit cards I keep making my payments will that card provider let me keep the card or once they see defaults will they make moves to not allow me to use that card anymore? The idea of not having a credit card for a real emergency worries me. Good Lucy in your journey 

What you need to do is save an emergency fund before your debts default because you need to realize you must live without credit, keeping one card is the top of a slippery slope. With an emergency fund in place it will cover real emergencies.

RAS

@Pumpkinmad, you need to start your own thread (see the red box in the lower right corner) so that both you and husnu1 get the specific response to your queries.

Meantime hope husnu1 if feeling a little less anxious today.

husnu1

RAS said:

@Pumpkinmad, you need to start your own thread (see the red box in the lower right corner) so that both you and husnu1 get the specific response to your queries.

Meantime hope husnu1 if feeling a little less anxious today.

Thanks, @RAS. Yes, I do feel a bit better after speaking with all of you here and also after opening up to a few close family friends. They were supportive and helped ease my mind.

I also asked a similar question in a private Facebook group focused on debt and got mixed responses. Some people said that creditors can still apply for a CCJ if I continue to ignore them, while others mentioned there’s a small chance of a Charging Order, mainly because I have quite a bit of equity in my home.

I'm sorry if I keep repeating myself. It’s just the way my mind works right now. I really appreciate everyone’s patience and support.

Grumpelstiltskin

Please keep off Facebook, honestly you will find all sorts of people on there with all sorts of ideas, some of which are thrown out just to upset you.

husnu1

tigergambit said:

husnu1 said:

tigergambit said:

@husnu1

You have had a lot of good advice here - particularly to stop payments, change your bank account if necessary and follow the First Steps thread instructions.

As someone who hit the debt crisis at 59 with £50k+ debt, a £62k mortgage and reduced income due to a mental breakdown I can wholly relate to your circumstances and struggles with anxiety. The very first thing you should do is go to your doctor and seek help for the anxiety. The rest is just money - in fact it's just numbers someone keeps on a computer somewhere, little bits of electric charge.

Get the thought of repossession out of your head - never going to happen. Build an SOA but be honest with it and generous to yourself. My initial mistake was taking everything to heart and trying to cut expenditure to the bone which only led to more pressure and anxiety. Leave yourself room to live.

Accept that you will now have to live without credit - but at our age that is certainly not a bad thing. The hardest thing is that we are conditioned to feel bad/ashamed about "letting" things get out of control and that is a mindset you need to work on and overcome. 

Keep safe.

Thanks for all the kind words. It sounds like our situations are very similar. I’ve been on medication for anxiety for the last 15 years, so I really understand how overwhelming it can all feel.

It’s a relief to hear that they can’t repossess my property. I’ve been so worried about that. As for my credit rating, I’ve kind of stopped stressing about it too. I guess I’ve just had to accept where things are for now.

Did you end up going into a DMP? And if so, how did you cope with all the stress that comes with it? I haven’t had a full mental breakdown yet. That would kill me because I need to carry on with my jobs in order to get out of this. I think my ADHD is helping me hold it together so far.

Yes, you MUST look after yourself and your MH first. I love my meds. 

I was a subpostmaster and that drove the breakdown but since then I have just not been as capable of earning well or managing money so slid into debt. On the other hand I'm a more relaxed nicer person so not all's bad.

I rather panicked and went to PayPlan once I heard of them and let them handle everything which was fairly stress free tbh. In hindsight I should have defaulted first but there is an upside insofar that PayPlan had all the interest and charges stopped immediately so I didn't really miss out much (this was in 2021, not sure what would happen today - PP seem to be keen on IVAs which I would avoid). I think I would speak to them or StepChange about it if I were you. At the start tell them that you are on meds for anxiety. You should also tell creditors this and ask to be dealt with by their vulnerable clients team when you get round to speaking/corresponding with them.

Regarding your SOA, you have a mortgage so you must have some sort of life insurance which isn't on there. I think TV licence is £14 per month so a typo and you forgot to put down Insurance and vets bills for your lovely little dog.

If it helps I think of my remaining unsecured debt as a 0% load which I pay off what I can to - currently £2 per month as I've just had an unexpected large bill. As long as you don't go silent AFTER they have defaulted it's quite straightforward.

How did you know that I have a new puppy? It is actually my daughter's, so she is covering the costs at the moment. I have corrected a few of the mistakes on the SOA, but I still have time to change a few things while waiting for defaults if I am going that way, which looks like I will. Regarding Life Insurance, I am looking into it now. I have been ignoring it since it was cancelled a few years back, and I have been lazy about it. 

kimwp

husnu1 said:

RAS said:

@Pumpkinmad, you need to start your own thread (see the red box in the lower right corner) so that both you and husnu1 get the specific response to your queries.

Meantime hope husnu1 if feeling a little less anxious today.

Thanks, @RAS. Yes, I do feel a bit better after speaking with all of you here and also after opening up to a few close family friends. They were supportive and helped ease my mind.

I also asked a similar question in a private Facebook group focused on debt and got mixed responses. Some people said that creditors can still apply for a CCJ if I continue to ignore them, while others mentioned there’s a small chance of a Charging Order, mainly because I have quite a bit of equity in my home.

I'm sorry if I keep repeating myself. It’s just the way my mind works right now. I really appreciate everyone’s patience and support.

So you need to ignore them to get the defaults and they can't do anything until they default you. Then you can pay them a token amount at that point and let them know that is all you can afford at the moment. From what other posters have said, you call them up and a nice man on the phone gives you the details to send the money to and wishes you a nice day. NB, your creditors are likely to sell your debt to a debt collection agency. These are even less likely to take you to court as they will have bought the debt for a fraction of what you owe,so they only need to recoup that to be happy. This means you will be able to make full and final offers in a few years time to pay off the debt at a much lower amount than you owe.

You can't be made to pay more than you can afford and all a ccj will do is get you to pay them what you can afford, so it's not worth them paying to take you to court.

Did you have a read of the steps I laid out in this thread yesterday? The posts were flying about a bit, so I think you might have missed it.

tigergambit

How did you know that I have a new puppy? It is actually my daughter's, so she is covering the costs at the moment. I have corrected a few of the mistakes on the SOA, but I still have time to change a few things while waiting for defaults if I am going that way, which looks like I will. Regarding Life Insurance, I am looking into it now. I have been ignoring it since it was cancelled a few years back, and I have been lazy about it. 

You need to have vets bills and pet insurance on your SOA whether or not you have one. It's always possible that you might get one at a later date iykwim.

Puppies and dogs are great for mental health. Only thing better that I know of is grandchildren.

Facebook is correct insofar as if you ignore creditors for long enough they will apply for a CCJ. To do that they have to have defaulted you and it is at that point that you respond to their next contact and tell them how much you will be paying them. You can ask about that on here when you get to that stage, but that's at least a few months away.