Advice needed

sourcrates

glasstable said:

(1) Do I cancel all direct debts? Even the ones that are for credit cards with the same bank?  

(2) I need too live off credit cards until next months payday - is this wrong of me? Money for debt is already earmarked or coming out for Januarys payments. I literally have £40 to last until then

(3) Can I request that communication is via letter only with debt collector companies?  Or should I just change my tel number? 

(4) Do I need to inform my creditors that I won’t be paying anything going forward?  Or do I just cancel payments without informing.

(5) Has Anyone ever had debt written off by speaking to bank about circumstances? 

(6) Do debt collectors turn up at your workplace? Sit and wait on you at home? 

Apologies for all the questions my brain is going 100 miles an hour with it all and the shame I am feeling is off the scale.

(1) Cancel direct debts yes, but you also need to move your banking to a "safe" account with a bank with whom you have no debt, as there are ways they can still take payments otherwise.

(2) Do what you have  to do to get to next payday, only you know what is required there.

(3) Yes, under GDPR you can request all contact be in writing only, changing number should be a matter of course anyway, you need to prepare beforehand, not after the event.

(4) No, just stop paying, they won`t be interested in the whys and why nots.

(5) Yes, many people have with mental health or other medical conditions, everyone's situation is different.

(6) Err, no, now you are entering the realms of fantasy, debt collectors have no more rights than anyone else, they work in a call centre mainly, some do knock on doors, but can only visit your registered address, and only after giving 7 days written notice, as they are supposed to make an appointment, but you do not have to speak to them, you can ask them to go away should they attend, just try not to let your imagination run riot here.

Why do you feel ashamed? what is shameful is a bank lending you money they never had in the first place, then charging you bucket loads of interest to stay in debt to them, the money lenders are there to make money from you, they have no shame, nor do they care when you can`t repay what you owe, you should not be feeling ashamed, you should be feeling relieved that you can at last break the chains of this debt, by re-taking control of your life instead of been dictated too by some faceless bank.

You will be fine, don`t worry.

Rob5342

SPM87 said:

Rob5342 said:

If I had simply stopped paying my Nationwide credit card then the very best case would be that I paid no more towards it and it became statute barred after six years. Making the affordability complaint meant I got a cheque for £5000 that I wouldn't have done otherwise and I was guaranteed that there would be no further legal action. 

well if you got a 5k cheque (and they did not wipe it off the balance) then fair enough, but the last place I am putting that 5k to is yo pay down any defaulted debt and that should be the advice to any consumer

The outstanding balance was £10k and the interest refund was £15k, so they wiped the balance and sent me a cheque for the £5k difference. Complaining resulted in me being £5k better off, if I hadn't complained then beat case I'd be £0 better off and could have had a CCJ. 

SPM87

Rob5342 said:

SPM87 said:

Rob5342 said:

If I had simply stopped paying my Nationwide credit card then the very best case would be that I paid no more towards it and it became statute barred after six years. Making the affordability complaint meant I got a cheque for £5000 that I wouldn't have done otherwise and I was guaranteed that there would be no further legal action. 

well if you got a 5k cheque (and they did not wipe it off the balance) then fair enough, but the last place I am putting that 5k to is yo pay down any defaulted debt and that should be the advice to any consumer

The outstanding balance was £10k and the interest refund was £15k, so they wiped the balance and sent me a cheque for the £5k difference. Complaining resulted in me being £5k better off, if I hadn't complained then beat case I'd be £0 better off and could have had a CCJ. 

this is a rare case, you paid tons of interest already and then defaulted and whilst you could have had a CCJ, this was miles off and only if you ignored every single process going. The way you said this is extremely misleading and not correct

ManyWays

this is a rare case
perhaps not as rare as you may think if someone has had several loans from the same lender or the interest was high and has been paid for several year.

The way you said this is extremely misleading and not correct
You seem determined to disagree with as many people as possible. @sourcrates has already explained that many loan lenders take the full amount of the loan, including interest, as being the amount due after a default

There are lots of tools for tackling problem debts. It is a mistake to think that what worked well for you is the only or even the best way forward for everyone. And the tools change over time. Affordability complaints work better in the first couple of years of a self managed DMP. Asking for a CCA works better after a debt has been sold. Settlement offers work better after a year or more. Creditors are much more difficult for business loans or guarantor loans (plus a few specific lenders). None of these are universal truths eg I have seen original lenders unable to produce a CCA agreement. But your blanket insistence on the one true way is not helpful for people exploring their situation.

SPM87

ManyWays said:

SPM87 said:

sourcrates said:

SPM87 said:

"if you default the interest gets wiped off anyway"

"Clearing debt is for people who want to preserve credit files"

Well yes and no to both of those statements, advice on this board is mainly tailored at those who need or want to repay their outstanding debts, if your strategy is to wait it out until they become statute barred, then none of this really applies to you.

Where interest is concerned, it depends on the type of debt you have, a credit card debt for instance would continue to accrue interest until it defaulted, wear as the interest on a loan will always be due as per the original agreement once defaulted.

There remains the possibility of a cheap settlement deal at some point, thus saving any interest accrued at the beginning of the process, but that can`t always be relied upon.

Hoping to keep creditors at bay for 6 years can work as a strategy for some, and if you have no assets or a job that forbids CCJ`s on your credit file, all well and good, but many who choose debt management are also homeowners, or their work requires a credit check, they have to be very careful how they proceed if they want to avoid a CCJ and a charging order.

For those people, and anyone else who choose debt management, affordability complaints can and do reduce the amount of indebtedness they may have, and in many cases, it can be very beneficial to them.

you say this but actually this is not the case, even for front loaded interest rate... loans typically accrue daily and some ones front load them, in either case the full balance including all the interest is never applied to the final amount. 

I have had 10s of thousands of interest wiped out by defaulting. This is just the reality

Lenders vary in how they treat loans, it sounds like you got very lucky if all yours stopped charging any more interest, this is not "typical" and with many, as @sourcrates says "the interest on a loan will always be due as per the original agreement once defaulted."

Also even if you do get lucky and have a loan lender who stops adding interest, winning an affordability complaint will reduce the balance as the previous interest charged is removed, which also happens with cards and overdrafts.

I doubt 2 people got lucky tbh on about 5 different loans. All front loaded interest loans asked for the borrowed amount remaining balance after default... it is literally 10s of thousands in interest front loaded gone across multiple loans.

SPM87

ManyWays said:

this is a rare case
perhaps not as rare as you may think if someone has had several loans from the same lender or the interest was high and has been paid for several year.

The way you said this is extremely misleading and not correct
You seem determined to disagree with as many people as possible. @sourcrates has already explained that many loan lenders take the full amount of the loan, including interest, as being the amount due after a default

There are lots of tools for tackling problem debts. It is a mistake to think that what worked well for you is the only or even the best way forward for everyone. And the tools change over time. Affordability complaints work better in the first couple of years of a self managed DMP. Asking for a CCA works better after a debt has been sold. Settlement offers work better after a year or more. Creditors are much more difficult for business loans or guarantor loans (plus a few specific lenders). None of these are universal truths eg I have seen original lenders unable to produce a CCA agreement. But your blanket insistence on the one true way is not helpful for people exploring their situation.

I disagree with most of your posts like you know what you are talking about and assume many things and are easily interpreted incorrectly by others reading. It is very Pro lender orientated, which incredibly odd if you have the consumers best interest at heart who are in a situation like many find themselves on here.

I take issue with people constantly promoting the likes of SC on here as another example. Very pro lender advice once again. I take issue with your assumed comments I have already pulled you up on of which you have little rebuttal on as to why you say such things so confidently, yet when questioned, act like you have not been questioned on it. 

it is not about what worked well or not well, it is about what is right thing to do based on the CONSUMER. Is paying defaulted debt in full good for the consumer? no it is not. Is filling out I&A form benefit to the consumer? no it is not.  why say things like - "you might get taken to court if you don't pay enough" based on what evidence do you say such bold statements? You have none.

You bring up business loans, and guarantor loans, these are specifically unique and I would not even comment on them, so why bring this into the conversation? you love to muddy the waters don't you? it is very clear I am talking about unsecured debt. 

There are some basic principles dealing with this, especially once defaulted. Once defaulted your goal should be to pay as little as possible to any debt purchaser who you never even borrowed off! (most debts will get sold on, the ones that for whatever reason the same still applies) yes there are unique circumstances... but these can be addressed as and when. 

ManyWays

it is not about what worked well or not well, it is about what is right thing to do based on the CONSUMER. Is paying defaulted debt in full good for the consumer? no it is not.
I think it is ALL about what is likely to work out well now. I would generally agree that defaulted debts do not have to be paid in full, although there are exceptions. And I dont think its helpful to assume that all consumers are the same. 

Is filling out I&A form benefit to the consumer? no it is not.  
An I&E form can be useful to enclose with a F&F offer and a request for a write off, The amounts that can be included for many lines are more generous than most people here assume; I probably spend more of my time here telling people to increase the expense lines than cut them. 

why say things like - "you might get taken to court if you don't pay enough" based on what evidence do you say such bold statements? 
because they are correct. I did not say WILL be taken to court. 

You bring up business loans, and guarantor loans, these are specifically unique and I would not even comment on them, so why bring this into the conversation? you love to muddy the waters don't you? it is very clear I am talking about unsecured debt. 
Many business loans and all guarantor loans are unsecured debts. I think one of the previous threads you commented on was started by someone with a bounce back loan and a house with significant equity.
I made those comments in relation to someone asking what sort of cases are more likely to end up in court, I never said they were very common. By giving accurate answers, you can reassure people that probably their pile of credit cards debts are very unlikely to end up in court. 

SPM87

because they are correct. I did not say WILL be taken to court - how is that correct? and clearly you must know this will create nervous behaviour in an already nervous consumer... 

Like I say - very Pro lender and not pro Consumer. 

There are no exceptions to paying off in full defaulted debt. This is a huge negative for any Consumer regardless of circumstance.

Sorry but it is clear to me which side you lay your foundation on and it is not the Consumer

Rob5342

SPM87 said:

Rob5342 said:

SPM87 said:

Rob5342 said:

If I had simply stopped paying my Nationwide credit card then the very best case would be that I paid no more towards it and it became statute barred after six years. Making the affordability complaint meant I got a cheque for £5000 that I wouldn't have done otherwise and I was guaranteed that there would be no further legal action. 

well if you got a 5k cheque (and they did not wipe it off the balance) then fair enough, but the last place I am putting that 5k to is yo pay down any defaulted debt and that should be the advice to any consumer

The outstanding balance was £10k and the interest refund was £15k, so they wiped the balance and sent me a cheque for the £5k difference. Complaining resulted in me being £5k better off, if I hadn't complained then beat case I'd be £0 better off and could have had a CCJ. 

this is a rare case, you paid tons of interest already and then defaulted and whilst you could have had a CCJ, this was miles off and only if you ignored every single process going. The way you said this is extremely misleading and not correct

The amount i got back is probably quite unusual, but it's not at all unusual for people to get interest refunds that significantly reduce the balance or give them a significant amount back directly.I haven't said anything misleading, complaining meant I got a significant amount back and completely eliminated any possibility of legal action. If I hadn't have made an affordability complaint then I certainly wouldn't have got any money back, and may have had to pay money to avoid a CCJ or may have even got one.

There are various ways to tackle debts that carry varying levels of risk. I don't think anyone here has any sympathy whatsoever with the lenders or debt purchasers, we just try and explain the implications of the various options so people can decide what to do.

tigergambit

SPM87 said:

Also I am not waiting for SB either.. there are not only 2 options, pay it all down or wait for SB. It is wait until not able to enforce or they cannot enforce and were never able to.. whatever comes first. 

this is why I say, pay as little as possible. Too many on here are promoting using SC and are doing budgets paying back mind blowing amounts of their income to defaulted debt. This is the scam of all scams and should not be advice

NO! There are not only two options. There are also the options of (i) playing the game by stringing things out and aiming for F&F settlements further down the line and (ii) Waiting until the debt has been sold on a few times and then asking for a CCA, hoping it's been mislaid or (iii) any combination of the above and other strategies.

Above all, this is a game but it can be played any number of ways and the way you play against one creditor does not have to be the way you play against another. Yes, above all your aim is to pay as little as possible (and imo avoid the courts) but there are many ways of doing this.

FWIW I disagree that many on here promote using SC - anyone with large or longer term debts inevitably gets told to self manage as far as I can see. You have also said " Is filling out I&A form benefit to the consumer? no it is not. " well, imo that rather depends. If you are playing a long game and aiming to secure a F&F then completing an annual SOA which shows decreasing surplus and a struggle to keep going is a very useful tool to have when negotiating the F&F. 

There is no set strategy in Debt Management - what is wrong for you may be the exact method someone else needs. An open mind is needed.