Dont know what to do

jack_tyler

Looking for help/advice.

I am really struggling with my debts each month. When I say struggling, I mean that when I have paid my debts each month, I have approximately £200/£300 to last until my next pay day, which is the 20th of each month.

I have 6 credit cards, that have outstanding balances, the highest one is £11,866 and the lowest one is £3,519. There is no interest on these cards, as they are on 0% promotional periods. I am paying more than what is requested each month, but only slightly more. I am not behind with any payments, and I have no defaults or CCJ's.

But by the time I have paid the finance on my car, my energy bills, council tax, road tax, insurance and my credit cards, I dont have much left to last me until my next pay day.

I don't have any savings, I do own my house no mortgage, but I cant even do an Equity Release because of the affordability factor, so I have been considering an IVA or similar, but I dont know what to do that will be the best option with the least damage to my credit file. I know that sounds silly but at the moment, according to Equifax, my credit score is excellent (in the mid 900's).

Please can anyone suggest anything that I can do, that will help me. I just want to get rid of these credit card debts, or at least the ones with the higher balances, so that it will give me more breathing room each month

Thanks

ManyWays

I think you have to forget about your credit score. Having a good credit score has not actually helped you; instead it has helped land you in in a very large debt problem..

When does the next 0% deal end and how large is it? Will you have difficulty refinancing it? At some point this house of cards tends to collapse, and if that is inevitable the sooner you call a halt the better.

Do you have any loans? If you do, when do they end?

The finance on your car, is it HP or PCP?
Have you had previous cards on finance and have you heard of car commission refunds?

fatbelly

I'll ask for this to be moved to the main dfw board. An IVA may be appropriate but as a homeowner, bankruptcy isn't

jack_tyler

https://forums.moneysavingexpert.com/discussion/comment/82048678#Comment_82048678

Hello, the next 0% ends on 11th Aug and the current amount outstanding is £3,519.

I don't have any loans (have tried to get a consolidation loan but failed due to affordability)

The finance on my car is PCP and that is due to end Sept 2027

Yes I have had previous cars on HP and also my late husband, I have heard of the car commission refunds, and I have contacted the finance companies to lodge complaints for my self and my late husband. I have had emails back saying that 7 of my late husbands finance agreements had this commission, so just a waiting game for them now. Also waiting to hear back from Black Horse, Close Brothers and Moto Novo for myself

sourcrates

Its really simple, just go into debt management, instead of paying the contractual repayments every month, you pay what you can afford from your budget, whatever that may be, and then it leaves you enough money to live on.

You don`t need consolidation loans, and an IVA, whilst being an option, is really too inflexible for many people.

Debt management is informal, lenders are well versed in its application and use, it will take longer to repay your debt, but all interest should be stopped, your credit file will hold negative information for at least 6 years before it recovers, but managing the debt is the goal here.

You can use one of the debt charities, or you can go it alone and DIY, this is most peoples preferred option, its more flexible and you remain in charge of events.

elsien

The self management option also gives you time to build up an emergency fund in between stopping paying the non-priority debts and starting whichever debt management solution you go for.

Your credit score does not matter. What is relevant is your credit history. You are unable to borrow more, which is a good thing because you really don’t need any more debt on top of which you already have. So you have to resign yourself to the fact that missed payments will show up and will impact on lending in the future.
I believe, although others on here may correct me if I’m wrong but if you re-mortgage with the same provider when your mortgage comes up for renewal that is less of an issue.

Are you able to say how you ran your debts up? There is no judgement here as to the reason but it helps to know because that is what you also need to address moving forward. For some people it’s life changes such as illness or redundancy, for others it’s gambling, for others it’s continual over-spending which has just mounted up. Whatever the reason, you have to get to grips with what caused your debts as well as dealing with the situation you’re in now.

This is the first step - you will find all the support here that you want - that include some plain talking at times where needed. 🙂

jack_tyler

https://forums.moneysavingexpert.com/discussion/comment/82048805#Comment_82048805

Please could you tell me what 'Debt Management' is? Is it another form of bankruptcy or an IVA.

jack_tyler

https://forums.moneysavingexpert.com/discussion/comment/82048894#Comment_82048894

I don't have a mortgage, so that isn't an option :(.

A few years ago I lost my husband, he was the main bread earner, as I only worked part time. But shortly after I lost my husband (and I mean only a few months after) I was made redundant from my job, so I literally lived off the credit cards :(. I was on benefits for a short while, and single person discount with my council tax, so that was next to nothing, as my son was not working.

Then my son got a job and because of his age, and another income coming into the home, my council tax went from around £10.00 per month, to what it is now which is £186.00. I eventually found a job but I only work part time, I have tried to get more hours, but not had much luck, so each month when my wage would not be enough to cover things, I did money transfer's from my credit card to my bank, but only when they were on promotional offers of 0% interest.

sourcrates

https://forums.moneysavingexpert.com/discussion/comment/82049073#Comment_82049073

Apologies, yes of course, its just an informal arrangement between you and your creditors, its not regulated, so there are no rules to adhere to, you simply pay what is affordable to you on a monthly basis, in place of the contractual repayments you currently pay.

You first need to work out a budget that you can live on, then, say your paying £100 to card A currently, under debt management your budget says you can pay £45, so that`s what you will now pay.

This allows you to then pay your debts, and have enough left to live on.

elsien

That sounds like you’ve had a really rough time of it with a lot to deal with.

Have you had another look at benefits that you might still be entitled to if you are still on a low income?

Council tax benefit and universal credit are the two that come to mind to start with.

RAS

You've obviously had a really tough time but using credit cards to fund essential living isn't sustainable.

sourcrates has a link a SOA (budget) calculator, see the stoozing link. Please can you fill that in with as much detail as possible. You say your son is now working, for example, what does he contribute to bills?

What's the pension situation regarding your husband's death? Any death in service grants, ongoing spousal pension?

Did you check whether you could get bereavement support payment?