Help With My Debts

Emz1987

Hi Everyone,
Ive been looking over the site a lot today and there is some really useful information and it gives me hope to read it all!

I am however, in debt like most of you and its really starting to get me down. I worry all the time and i never seem to have any money to myself.

I have a £10,000 loan and a credit card at £5000 and my partner and I have £10,000 owing between us on a car. I have never missed a payment or had a CCj or anything but im wondering how long it will be before that happens as Im always in my overdraft and it seems to get worse every month. We dont own our house, we rent it. Luckily, i am young and still have many chances to progress in my job and earn more money but it is here and now that i am worried about. Also, my partner is due quite a bit of compensation and is going to help towards both our debts but that could be 12-24 months away! I just dont know what to do and I feel like a failure

Tiglet

Hi Emz,:hello:

Congratulations on spotting the problem so early:beer:

There's a thread at the top of the board with lots of useful stuff to get you started. There's no need to read it all just yet, but make sure you know where to find it when you need it.

The first thing you'll need to do is to put together an SOA (statement of affairs). That lists all your income, spending and debts. If you post that, then all sorts of people will start popping up and suggesting ways you can make your money go further.

As you've got at least two loans, it would also be a good idea to read the article on reclaiming PPI because most people who took out loans with insurance payments built in stand a good chance of being able to reclaim them. There's a link on the right of the page.

Good luck!!!

Emz1987

thank you very much for being the first to reply. i think one of my main problems is that i simply dont know how much i am spending out per month. this is down to sheer stupidity of my own and also being worries to check my bank account as ive always stayed on top of my finances

also, i have just moved home with my partner and as of yet, we havent a clue how much our gas/electricity/water is going to be.

when i took out my loans, i opted not to take the payment protection and i searched around to get my own as i knew this would be cheaper so dont think i am entitled to claim anything back

Tiglet

The first thing to do in that case is a spending diary. Keep track of literally every penny you spend. The results can be a real eye-opener. Little things like buying a sandwich on the way to work can build up over the year to be an astonishing amount of money, most of which you can save by making your own.

Have a look at other people's SOAs. That way you can get an idea of how much things are likely to cost. They might not be spot on, but they'll help you budget and, over time, you'll be able to use your own figures as you get them.

Try to pluck up the courage to go through your most recent bank statements too. See how much your spending each month, and try to work out where it's all going. All of this helps to build up the picture of what you're doing with your money and simply by being aware of it you begin to get more control over it.

And remember, it's not something to beat yourself up about. You've acknowledged that you're in debt, and now you've started doing something about it. If you've overspent in the past, then that's in the past and what matters now is finding ways to make your money go further. By posting here, you're starting to do exactly that.

Emz1987

I have started to put together an SOA which I will post up asap. I have also got myself a spending diary to make notes everytime i spend.

I had a phone call last night off a debt advice company who said the best thing for me to do if to get an IVA which covers mine and my boyfriends debts. Is this really the best thing for me? What are the implications and does this affect my credit rating and chance of getting a mortgage? Surely there is another way round this first?

newmum1

If you do speak to any companies then make sure they are the free ones such as CCCS or the CAB the ones that charge a fee are generally just there to make money from you, just be carefully. Do you think you need an IVA as you said that you have never missed a payment, the implications i believe are very serious chances are you wont be able to get a mortgage or further credit not sure if its for a specific period of time or not but think carefully before going down that route.
im guessing your debts are manageable if u have not missed a payment, call up the gas etc companies and try to get onto a monthly plan that way you will know how much the bills will be each month hope this helps

Tiglet

Emz1987 wrote: »

I had a phone call last night off a debt advice company who said the best thing for me to do if to get an IVA which covers mine and my boyfriends debts. Is this really the best thing for me? What are the implications and does this affect my credit rating and chance of getting a mortgage? Surely there is another way round this first?

Yes, of course there is!. An IVA is a pretty serious way of dealing with debts that have got out of control. There are loads of companies touting them because they make money from them. There's no reason on earth why you should be considering anything so drastic. Your finances haven't got out of control and in any case there are charities who can give genuinely impartial advice to those people who actually need to take such drastic action.

monkey22_2

Morning Emz,

Well done for facing up to your debt - this is the worst bit, I think, working out how much you owe and where the money goes each month.
I wouldn't worry about an IVA just yet, did that company call you out of the blue? If so, they probably just want to make some money out of you.

Newmum is right - talk to one of the free debt charities like CCCS or Payplan if you need to. They're brilliant, really helpful, they won't judge you and most importantly they're FREE.

First, sort out your SOA and you'll get loads of advice on here on how you can save money and make your repayments more manageable.

Good Luck!

Monkey22

lindens

Emz1987 wrote: »

thank you very much for being the first to reply. i think one of my main problems is that i simply dont know how much i am spending out per month. this is down to sheer stupidity of my own and also being worries to check my bank account as ive always stayed on top of my finances

/quote]

I used to be like you, was afraid to look at my balances, so stuck my head in the sand and put it on the plastic. Well Obviously I couldnt go on like that forever, it all came to a head and I had to get help from CCCS. It was the best thing I ever did. The worst bit by far was putting together my SOA it was sooooo scary BUT it made me face my demons. Once I did that and spoke to the CCCS who were so helpful and non judgemental, i felt so much better like a weight had been lifted from my shoulders. It was because I was back in control.
Now your situation is not bad enough to see the CCCS, but my point is that the first step is hard but from that moment onwards you will feel so much better. Don't get me wrong you will still have bad days.
Please put together an SOA. If you dont want to post it on here then you dont have to but as an exercise it is worthwhile.
I have gone from someone who never opened bank statements or checked their balance, to someone who is addicted to checking it daily online (internet banking is also one of the best things I did), looking at all my different "pots", adjusting my signature and seeing my debts going down.

CCCS_Alan

Hi Emz1987

Welcome and well done for posting. The first step is always the hardest and you have taken that by admitting the problem.
With your current debts you said you have money owed on a car. Is it a HP/conditional sale agreement or is it just a personal loan. If it’s the first and you don’t keep up repayments they could take the car back, and dependant on how long you have had the car bill you for the remainder of the balance owed after the sale of the vehicle. If it is a personal loan and you miss payments the vehicle cannot be taken away from you.

As people have said about people calling you offering an IVA, be careful. They are not always the best option for everyone, so look at putting together your SOA and posting to get some hints and ideas of what you can look at changing or reducing.

Spending diary is a brilliant way of keeping in control and you might want to think of opening a basic account away from your overdraft so you are in control of your money. Set up your priority payments to your essential living costs from the new account and pay your creditors in a way you control from this new account, such as a SO or payment over the counter. Use the following link Basic Bank Accounts, and in the Basic bank accounts section click on publications it will provide you with a list of accounts and what benefits the account offers.
Be sure that the account has no connection to any of your existing creditors though.

As many people have said you might want to get some independent financial advice from one of the places that have been recommended by fellow users. You can also try online advice facility called Debt Remedy where you can complete a financial statement and be provided with advice on the best way to deal with your situation.

Hope you find it useful and good luck

CCCS_Alan