I'll start here first..........

needadviceasap

I've always had a higher amount of debt than my peers, however, I recently got very much in control and was proud to do so, even consolidating some of my personal debt to a shorter period so that I could pay it off more quickly.

However,........I run my own business and last year, we incurred two high value bad debts which affected cashflow. Believing that this was a 'blip' and that we'd get the money back, I threw £35,000 of credit card 'cash' at the business, expecting to get it back again very quickly and with the company paying the repayments in the meantime. We took back one of those debts but the other remains outstanding and with a very poor economy, the business is still very much suffering. I'm now on a verge whereby the company will either be bought (someone is interested) or it will go under and I will know one way or another in the next couple of weeks. Either way, it looks unlikely that I will be able to repay the monthly payments for the credit card 'directors loans' to myself for some time (and didn't last month either) and I can't afford to pay these from my regular income.

I spoke to a debt management company today but having read through some of the info on here about IVAs (which was the company's recommendation) I'm now worried that this might not be the best way forwards.

My immediate problem is how to get through the next couple of months without missing any payments on anything (which I've never done on any of my debt to date) before I will know what the longer term situation is and will then have to assess everything else again at this point. My credit cards were on special deals originally, but are no longer, however, I can't move them anywhere as they're all full.

I thought I would start by asking advice from what seems like a highly knowledgeable and wise group of people here!!

So.........here're my 'details':

Outgoings (general excl credit)
Mortgage: £800pm
Life insurances: £45.97pm and £26.16pm
Buildings and contents: Paid last month for year (£180pa)
Gas: £22pm
Electric: £31pm
Council Tax: £125pm (over 10 months)
Water: £25pm (on water meter)
TV/Broadband/Phone: £90pm
Mobile: £25pm
Bank Account Chge: £15pm
Petrol: approx £80pm
Food/Household: approx £150pm

Credit cards:
Lloyds: £15k o/s, minimum payment £293pm
Egg: £9,500 o/s, minimum payment £184pm
Egg Money: £2,500 o/s, minimum payment £48.58pm
RBS: £4,500 o/s, minimum payment £95pm
MBNA: £12,000 o/s, minimum payment £104pm
Nationwide: £100 o/s, minimum payment approx £6pm

Loan:
Goldfish: approx £10,000 o/s, £492.11 pm

Overdraft facility: £1000 (which is being used to the max)

Income: this month, it will be £1,616 net and my partner is able to pay me £500 pm towards everything so a total of £2116pm.

TOTAL DEBT: approx £55k

Good to get that out in writing...not sure where I start in tackling it tho!! And I guess I'll need to tackle / make decisions quickly so I don't end up over my overdraft and get charged which will add to the problem! Should I really consider that IVA? There seem to be people in worse situations than mine here who have been able to get in control without this.

hypno06

You have options here - an IVA may be one of them, but it is a very very big step to take, and for MOST people it is not the right thing to do - I think almost everyone on these boards would agree with me there.

You could do a DMP whereby you pay a reduced amount to your creditors. This can be done with a company, or by yourself.

If using a company, please please please make sure you use one of the charitable services like CCCS or CAB or National Debtline. Do NOT go to anyone who is going to charge you a monthly or up front fee.

Or you can just knuckle down, make a bit extra money, cut back on the stuff you don't need......and do it that way. If this is the way to go then I strongly suggest using the snowball calculator on www.whatsthecost.com to give you a starting point.

Whatever you do, I would suggest a call to CCCS - they are very helpful and can help give you your options. I have spoken to them on more than one occasion, even though I am not on a DMP and they have always helped me see things clearly.

zincoxide

Woah!!!!!

IVA's are not always the best route - especially those advertised on the tv, in newspaper ads etc. These companies will take a large cut for themselves and you'll end up paying over the odds.

The first people to contact are one of the UK's debt charities such as:
Payplan
CCCS
National Debt Helpline

Call them first thing tomorrow - they will do the utmost to help you. Other debt companies that charge a fee CANNOT do anymore than a debt charity.

needadviceasap

Wow! Replies already! And already getting me thinking...Thank you!
I will call one of those charities listed tomorrow.

Re your message, Hypno, could I actually contact the loan / credit card companies myself and ask them if there's a way I can reduce the monthly amount? This is something I would definitely do if it was worth doing.

I've got a new business plan on paper regardless of what happens with the exisiting company (and believe it to be a good income generator) plus I have stuff listed on ebay at the moment (was aiming to list something every week from the beginning of the year and was doing really well until everything started going wrong with the company) and so there's a very real possibility that I could actually DO this myself!

I'mcomingbackasaman

I agree with the others an iVA is just a way of paying someone else to do what a charitable organisation can help you with, and you only have to pay a donation towards their work (optional). Good luck there's a lot of peeps in the same boat as u I should imagine thanks to our Tory er, Labour (?) government.

hypno06

I think that if you go onto the national debtline website, there may be templates for you to use with creditors.

Be aware, that as soon as you pay less than your contractual payment, regardless of whether you do this yourself or via a 3rd party such as payplan or CCCS etc, you risk damage to your credit file that will stay on file for 6 years.

Of course, this may well be a small price to pay for being able to get by and manage, but you should just be aware of the fact!

Have a look at the websites for CCCS and National Debtline - they give you loads of info. Be careful when using google though - some unscrupulous firms use similar names - make sure you use only those who DO NOT CHARGE A FEE!

sweetnothings

TV/Broadband/Phone: £90pm
Mobile: £25pm

check out the virgin website as it has an offer of all these 4 packages for £10 each per month so 4 for 40 or 2 for £20 etc if you cant break an existing contract ie mobile. Its worth checking out though, if you look into all your outgoings there are probably savings to be made on all and however small they will all add up. If you did the 4 for £40 virgin deal then that alone would save you £75 per month.
Good luck ! )