Advice on my debts please

System

This discussion was created from comments split from: Struggling with debt? Ask a stepchange debt adviser a question.

sa11aver

Hi - after some advice.
Have a number of unsecured debts :
Barclays overdraft 1 - £4500
Barclays overdraft 2 - £2500
Barclaycard £14679
Tesco credit card £7845
Tesco loan £5476 balance 
Nationwide loan £6324 balance 
simply Be £1109
Salary Finance £19342

i went onto the step change site and a dmp was recommended - I’ve also taken lots in from this forum.  I do have 2 questions though 

1.  The salary finance loan is a scheme through my work with payments being deducted straight from payroll.  I would really prefer not to default on this (I don’t even know if I can) and not involve my work in not making the payments.  They would physically have to stop them .  Am I able to treat this loan differently and keep making the payments?  Have about £600 a month to distribute between other debts when I take the salary finance one out of consideration. 

2.  My loan with nationwide is unsecured but my mortgage is also with Nationwide.  I have 3 more years left until I renew, will it be a problem if I default the loan.  

Many thanks 

sourcrates

Moved for you.

RAS

sa11aver said:

Hi - after some advice.
Have a number of unsecured debts :
Barclays overdraft 1 - £4500
Barclays overdraft 2 - £2500
Barclaycard £14679
Tesco credit card £7845
Tesco loan £5476 balance 
Nationwide loan £6324 balance 
simply Be £1109
Salary Finance £19342

i went onto the step change site and a dmp was recommended - I’ve also taken lots in from this forum.  I do have 2 questions though 

1.  The salary finance loan is a scheme through my work with payments being deducted straight from payroll.  I would really prefer not to default on this (I don’t even know if I can) and not involve my work in not making the payments.  They would physically have to stop them .  Am I able to treat this loan differently and keep making the payments?  Have about £600 a month to distribute between other debts when I take the salary finance one out of consideration. 

2.  My loan with nationwide is unsecured but my mortgage is also with Nationwide.  I have 3 more years left until I renew, will it be a problem if I default the loan.  

Many thanks 

The first thing to note is that a debt management plan is completely informal. If you DIY, you decide how to do things, within a few parameters.

So creditors can see your credit record, meaning that if you keep paying some debts in full and not theirs, they might be less co-operative. However, sometimes people like to clear a few very small debts to make life easier, and credit unions often need to be managed differently from commercial consumer credit. Certainly engage with them from the start.

But I doubt the salary sacrifice is reported on your credit record? And you do need to check the rules round it carefully before doing anything anyway. 

The mortgage situation is easier. When you're renewal is due, as long as the mortgage is up to date you just log in to nationwide and select the best of their products. No credit check needed, and no cross over between consumer and secure debts. Folk here do it all the time, sometimes twice or more during their DMP.

Grumpelstiltskin

We really need to see your SOA ( in sourcrates signature) to get the full picture of your circumstances.

StepChange_Aidan

sa11aver said:

Hi - after some advice.
Have a number of unsecured debts :
Barclays overdraft 1 - £4500
Barclays overdraft 2 - £2500
Barclaycard £14679
Tesco credit card £7845
Tesco loan £5476 balance 
Nationwide loan £6324 balance 
simply Be £1109
Salary Finance £19342

i went onto the step change site and a dmp was recommended - I’ve also taken lots in from this forum.  I do have 2 questions though 

1.  The salary finance loan is a scheme through my work with payments being deducted straight from payroll.  I would really prefer not to default on this (I don’t even know if I can) and not involve my work in not making the payments.  They would physically have to stop them .  Am I able to treat this loan differently and keep making the payments?  Have about £600 a month to distribute between other debts when I take the salary finance one out of consideration. 

Hi,

We would recommend that you include the Salary Finance loan in the DMP if possible. If you continue to pay the full amount this would be showing a preference to them, and there is a risk that the other creditors would be less likely to accept a reduced payment if they feel unfairly treated.

However, if stopping payments will put your job at risk, it can be excluded from the DMP. I’d recommend checking with your employer before going ahead.

sa11aver said:

2.  My loan with nationwide is unsecured but my mortgage is also with Nationwide.  I have 3 more years left until I renew, will it be a problem if I default the loan. 

Your current mortgage won’t be directly affected by the DMP, even if you have a personal loan with the same lender. When it comes to renewal, a credit check isn’t usually required if you’re staying with the same company, but a history of missed or reduced payments on your credit file will make it more difficult to switch lenders.

If you have any other questions about the recommendations from our online Debt Advice tool, you could contact an advisor via the chat on our website or give us a call to discuss your options in more detail.

Regards,

Aidan 

ManyWays

It is possible to win affordability complaints against Salary Finance, that would remove the interest from the balance and for such a large loan this may be worth trying.

caprikid1

ManyWays said:

It is possible to win affordability complaints against Salary Finance, that would remove the interest from the balance and for such a large loan this may be worth trying.Wo

Would need to think carefully about this !

sa11aver

Thank you for all your thoughts.  The salary finance one seems to be a problem.  I am loathe to disclose my financial issues to my employer - and there is no way to stop payment without telling them to do that and even if the payments stop I think salary finance go back through the employer to reinstate them.  (I am trying to clarify all this exactly with the documentation I have).
When I look on Experian I can see the Salary Finance loan under credit accounts.  Assume this would be visible to others 

RAS

You certainly need to clarify the situation. If you keep paying it you need to be able to explain.

sa11aver

Have gone through all the Salary Finance paperwork and this is how I understand it.

Salary Finance instruct my employer each month to deduct the payment from payroll.
All questions about not being able to pay just direct you to speak to Salary Finance who can “help”
My employer won’t stop the payments to SF unless they tell them to do so by not requesting them to deduct it from payroll.
So in effect I can’t see how I can stop the deduction - unless there is a way that I speak to SF and get them to stop!
As I understand it this is how SF offer better rates and more easy acceptance- because you are more tied in through payroll deductions so less risk for them.

anyone have any inspiration on how to tackle this - or what conversation might work with SF

thanks again