Getting out of debt

ssteer

I've been very careless since I turned 18, I was living well beyond my means and finally had my lightbulb moment this afternoon when one of the companies I owed money to phoned me up demanding £1,300 by Feb. 29th (I'll get more into that later)
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I've been on benefits for the past three years due to suffering from clinical depression, anxiety and a bad back. I was also living at home rent free and so had cash in my pocket to do what I wanted with. Then I moved out of my parents home about 2 years ago and that's when the problems began. I somehow managed to run up £6,000 debt in little over a year on credit cards, loans, overdrafts etc. As a result, I've had to move back in with my parents and am now struggling to pay off my debt.

Here's my SOA

Incapacity Benefit: £393.80
DLA: £136.80

Rent: £240
Mobile phone: £20 (PAYG)
Motorbike Insurance/MOT/Tax: £40
Vonage landline: £8.99
Clothing: £20
Petrol: £40
Food: £40 (I'm Muslim so I buy halal meat and other bits to make my own meals)

TOTAL: £348.99

DEBTS

Abbey Loan: £1,731 (now with 1st Credit Ltd)
Capital One CC: £768
JD Williams: £478
Provident: £490
HFC (laptop finance): £411
Bennetts Insurance: £90 (now with CARS)
Littlewoods: £1,515 (now with Nationwide Debt Recovery)
Carphone Warehouse: £515
Virgin Media: £128

TOTAL: £6,126

I have a compulsion to spend my surplus income on complete and utter rubbish such as new handbags, takeaways, going out etc. I've buried my head in the sand up until now, I keep getting letters through the door and the phone ringing at all hours of the day, yet I keep ignoring them. On the occasions I have taken affirmative action, the creditors have been really difficult to negotiate with (which I can appreciate is my fault as I haven't ackowledged them) such as Abbey who I informed months and months ago that I was unable to pay my contracted monthly payments and I offered them a token payment which they refused to accept so I just gave up. It was yesterday afternoon that I finally got the wakeup call that it wasn't going away as Abbey had sold my debt with them to 1st Credit and they were demanding money I couldn't possibly afford. I spoke to a rather obnoxious young man whose name I didn't get, but he was saying that I needed to repay the whole amount within 7 days or else they'd take me to court. He also asked if I had family or friends who could help me out and when I said no, he seemed rather surprised and I said, well my parents are struggling to pay their mortgage as it is, my sister is on benefits, my friends are all on benefits, my aunties and uncles are struggling to live within their means, my gran's on a pension, my grandad's in a nursing home and I don't speak to my cousins. Then he said something about me not being able to buy a mobile phone which had no relevance whatsoever to the matter in question. Eventually he said he would make an arrangement for me, but only if I coughed up a £200 lump sum by February 29th which I know I can't do because I don't get enough money on payday for it to be possible.

So, on my sister's advice, I'm going to the CAB today to get some advice. I have a terrible memory due to the depression and so I forget to pay my creditors when I said I would, even if I write things down 9 times out of 10 I end up losing the bits of paper I've written stuff down on.

Sorry for the long post but I needed to get that off my chest.


Safiya.

Surfbabe

Bumping this

carrottopsuk

ssteer wrote: »

I have a terrible memory due to the depression and so I forget to pay my creditors when I said I would, even if I write things down 9 times out of 10 I end up losing the bits of paper I've written stuff down on.

Get a hard backed book or diary and carry it around with you at all times so you don't forget

Good luck

oh, is the Virgin Media debt - arrears? If not, can you cancel it?

MrsTinks

Well done - you have come here and you are going to see CAB to get this sorted. Whatever happens do not let the creditors force you to pay more than you can afford. They cannot legally do that and dont let them tell you they can!
They may take you to court however BEING IN DEBT IS NOT A CRIME. Don't let them tell you that it is and that you could get into trouble etc.
I notice you say you have a motorbike, how much is this worth and could you sell it to pay some of the debts off?
If they start calling about the debt then explain that you suffer from depression and you are under medical treatment for this. Point out to them that continuing to chase you is a breach of the OFT guidelines once you have informed them of your illness.
Is there any view of you being able to return to work in the near future? I know you say that you have a bad back as well as being depressed, are you getting treatment for both conditions?

RAS

Hi

Make sure that you see a financial advisor at CAB.

With respect to payments, you can get a basic bank account, pay in your benefits and then set up direct debts to pay your creditors each month. That way, you know they are covered.

the memory will return as your health improves.

Also, there is a letter here advising creditors that you will only deal with them in writing. i would advise sending it and refusing to deal with any of them by phone.

Eshka_2

Hi - first up, congratulations, you've really taken a big step posting on here and you need to give yourself credit for doing so - it isn't easy facing up to it, but once you do, it only gets easier.

Like loads of others here, I've been in the same hole as you, for the same reasons.Lived way beyond my means while at uni, never paid the debts off, became a mum and now I'm on benefits struggling to make ends meet. But once you have that lightbulb moment and start to take some action (which can be really scary, but stick with it), you'll find you feel a weight almost instantly lifted off your shoulders.

Approach all relevant authorities for advice - CAB and CCCS for a start. Do NOT be tempted by any dodgy offers of help or advice, never ever pay a fee for any of this. Another suggestion is to make a list of all your creditors and contact them one by one - daunting I know - and explain that you are now making moves towards resolving your debt. As long as you just contact them and explain your situation, it's a step in the right direction. Don't expect them to be anything other than rude and obnoxious - they want your money after all - but do it. At least then you'll have the piece of mind of knowing you're *acting* on things and not just sitting with your head buried as far as possible trying not to think about it.

I can identify with the depression, too - and trust me, doing what you're doing now will only help, and it'll be worth so much more to you because it's you helping yourself.

Good luck, I'll keep an eye out for you.

LilDevil

Well done on taking that first step! I'm at work at the moment so have only skimmed through the replies, so please forgive me if I'm repeating things!

I think you need to write to all the people you owe money to and explain briefly that you are ill and are currently on benefits. Make them an offer of say £10 each per month (or less than that depending on your SOA), also ask them to freeze interest. I would also include an SOA so that they can see you cannot pay any more than that.

Most companies are OK and will accept reduced payments as long as you communicate with them - they will get shirty if you ignore the problem (as you've found out!).

I once had a big problem with Next, who refused point blank to accept my more than adequate offer of payment (£30 p/m, they wanted £60). Every few days they were sending me letters demanding payment or they would refer my account to a Debt Collection agency. I would reply - always in writing - reiterating that I could not afford to pay what they were asking and repeated the offer of £30 p/m. This carried on for about 3 months and I got so fed up with them I wrote and told them to stop procrastinating and actually pass my account on to the collection agency as they would be more than happy with my offer - within the week, I had a letter accepting my offer!!!!

The above story is to show that you should stick to your guns with your offers, don't let them bully you, no matter what they say. Many agencies will accept a smaller payment, so they're not really that bad! You should also make sure everything is put in writing so that you have a paper trail to fall back on if you need to take matters further.

If they keep calling you, tell them that you are not prepared to discuss the matter over the phone and to please put anything in writing. If they continue to call despite this, tell them they are bullying/harrassing you and you will seek legal advice if they persist.

ssteer

I'm going to the CAB on Friday (I've been sick for the past 2 days) to hopefully sort out this mess. I've also got a voluntary job lined up starting next week, I know it's not paid but the idea is that if I start working voluntarily, I'll be building up work experience thus making it more likely employers will want to hire me. I haven't had a job since I left school but I have been in and out of college and youth work programmes although the last one I was at I had to leave when my depression started acting up again.as well as hurting my back (too many horse riding accidents when I was younger I think).

I have had yet another wakeup call to how bad my debt problem is when I got a letter through the post from npower yesterday saying that they had taken it to county court but if I phoned them and paid immidiately I could avoid a judgement being entered against me. So I've decided to pay it off in two payments this week and in 2 weeks when I get my DLA so that it's over and done with and it's another thing I can cross off my list.Then the rest of them I can (or the CAB on my behalf) negotiate some sort of payment arrangement so I can finally clear this once and for all.

Quick question before I sign off, I actually dispute what I owe npower as I think I was way overcharged for my electricity. I would have changed providers whilst I was living on my own but given I was only at the property 10 months and three of those were spent at my parents house during the floods I decided it wasn't worth it. Basically I had a bedsit, one room, a kitchen, a bathroom and tiny hallway and I was being charged £45 a month for that whereas my friend who has a two bedroomed house was only being charged £20 by the same company. I didn't really use a lot of electricity, turned my TV and computer off at night, never left anything on standby and I never ran a heater in the winter even though the place was freezing. Is it worth saying I dispute it or should I just pay it off and consider it over and done with?


Any help is appreciated and I thank you all for your suggestions.

Benthosboy

Hi Safiya.

I'm sorry I can't offer you any particular advice about your situation but what I will say is that if angels exist, forget Heaven, this forum is where they all live :A :A :A

As others have said, a lot of folk on here are in the same boat as you (and me, to my ) and are only too willing to help if they can. Getting yourself sorted is easier said than done and it sometimes feels like the weight of the world is on your shoulders but trust me, it isn't. For me, the lightbulb moment was a turning point. Immediately I'd had it and came on here, things have started to improve. As much as anything, it's knowing that you're NOT alone.

Try not to worry too much about your situation, look for the good things in life, keep smiling and if you need a virtual shoulder to cry/lean on, shout up!!

Martyn.

ssteer

I've made some headway. After having a think about it, I decided to just pay my npower debt and consider the matter closed. I also phoned up the place where I want to do the volunteering work and I have an interview on Friday. I'm feeling more positive with regards to getting everything sorted.

fatbelly

Make sure the CAB check whether those catalogue debts are enforceable - if they're pre-April 2007 and you didn't sign anything, they're not.

And get them to talk to you about Administration Orders. You qualify if you have multiple debts, one or more CCJ and total debts under 5k - opinions differ as to whether unenforceable debts should be included. I say they don't.

More info here:
http://www.nationaldebtline.co.uk/england_wales/factsheet.php?page=09_administration_orders