What a mess...

stvn1 · 29 October 2017 at 1:19AM

Hi everyone. I've just signed up after reading the forum for a couple of days.

I was sitting in work this week wondering about the future when I got an email from a debt collection company called ACI who bought my debt from Avant Credit. I usually ignore these but this one started me thinking about my financial situation and money I owe. I've been really stupid.

I owe somewhere in the region of £11,000 but I'm still in the process of working out exactly who I owe it to. I had no idea it was this much until I sat down and added it up, I can't really explain or understand my attitude to debt in the past but I've now realised how ridiculous I've been. Most of the debt is owed to credit card companies and short term lenders.

I've never been good with money and mostly live month to month with little thought for future planning, this has to change. I should know better, I'm middle aged and married with kids, a mortgage and a dog.

Step one has been to contact ACI about the Avant Credit debt, I owed them £1386.60. I have decided that coming to an agreement for partial settlement is my plan of action and they have accepted a settlement figure of £282 in two installments based on a conversation I had with Avant before they sold the debt. So the first £141 was paid on Friday with another £141 due by the end of November. It's a small start I know but it has spurred me into action.

I'll update with my debt details soon and I hope to use this as a record of my progress.

Thanks for reading.
stvn1

stvn1 · 29 October 2017 at 9:58AM

So here's who I owe money to at my lbm:

Lowell £ 829.31
Lowell £1348.19
SLL £ 960.00
ACI £1386.60
Moorcroft £ 690.47
CRS £ 773.12
Moorcroft £ 719.48
Rob Way £2191.00
Barclays £1039.00
Cabot £1327.32

Total £11264.49

Most of this is owed to debt collection companies, I've been in complete denial.

My priority bills are up to date and after they are paid I have £500 a month free. I aim to allocate £200 a month plus whatever extra I can come up with. Does that seem reasonable?

atolaas · 29 October 2017 at 10:04AM

Hi stvn1, It would be useful if you could post an SOA (Statement of Affairs) Please click on the following link

http://www.stoozing.com/

It helps to put things into perspective after your LBM.

Good luck x

stvn1 · 29 October 2017 at 10:26AM

Hi, thanks for the link, I'll have a look at that later today. My situation is a little funny because I'm the secondary earner in the house. I work part-time due to a medical issue and my wife earns more. She pays the majority of the main household bills and although she is aware of the situation I'm determined to fix it myself without affecting the wider family finances. I don't mind if I have to suffer but it's not fair to make her or the kids suffer for my foolishness.

stvn1 · 29 October 2017 at 10:39AM

So here's my SoA. This is just with my salary and payments in responsible for. My wife earns more than me but these are my debts and I don't want to drag her in. My car and home insurance was paid for the year and they're due again in April and January 2018.

All my debts apart from Capital One which is up to date are with debt collection and not accruing interest or charges.

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 2
Number of cars owned.................... 2

Monthly Income Details
Monthly income after tax................ 1016
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1016

Monthly Expense Details
Mortgage................................ 120
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 120
Electricity............................. 40
Gas..................................... 20
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 34
TV Licence.............................. 0
Satellite/Cable TV...................... 69.87
Internet Services....................... 0
Groceries etc. ......................... 0
Clothing................................ 60
Petrol/diesel........................... 40
Road tax................................ 16.18
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 8.41
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 0
Entertainment........................... 60
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 588.46

Assets
Cash.................................... 450
House value (Gross)..................... 140000
Shares and bonds........................ 0
Car(s).................................. 1200
Other assets............................ 0
Total Assets............................ 141650

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 13000....(120)......0.25
Total secured & HP debts...... 13000.....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Lowell.........................829.31....0.........0
Lowell.........................1348.1....0.........0
SLL............................960.......0.........0
Capital One....................989.......27........39.9
Cabot..........................1327.32...0.........0
Barclays.......................1039......0.........0
Rob Way........................2191......0.........0
Moorcroft......................719.48....0.........0
CRS............................773.12....0.........0
Moorcroft......................690.47....0.........0
ACI............................1386.6....0.........0
Total unsecured debts..........12253.4...27........-

Monthly Budget Summary
Total monthly income.................... 1,016
Expenses (including HP & secured debts). 588.46
Available for debt repayments........... 427.54
Monthly UNsecured debt repayments....... 27
Amount left after debt repayments....... 400.54

Personal Balance Sheet Summary
Total assets (things you own)........... 141,650
Total HP & Secured debt................. -13,000
Total Unsecured debt.................... -12,253.4
Net Assets.............................. 116,396.6

Created using the SOA calculator at
Reproduced on Moneysavingexpert with permission, using other browser.

stvn1 · 29 October 2017 at 10:48AM

So, debt one for targeting is the £1368.60 owed to ACI. This was originally owed to Avant. Before they sold it we had agreed a partial settlement figure of £282 and thankfully I kept the emails. ACI have honoured this and I paid £141 on Friday. As soon as I have the other £141 I'm clearing it. That's a saving of £1086.60 and a decent start I think.

MrsSave · 29 October 2017 at 10:58AM

For your car and home insurance you really should be putting money aside each month so that you don't have to find the money/pay for them on the credit cards when they're next due.

Your sky seems a lot. What do you have with that? Many people would advise getting rid, but if you wanted to keep it, have you phoned them to ask for a discount. I've currently got 40% off my bill for 18 months, had 50% off for the 12 months beforehand.

Have you discussed in full with your wife about your circumstances. She may want to be involved, and it will be far easier dealing with it as a family. Have you addressed what caused the over spending to start?

Good luck on your journey.

stvn1 · 29 October 2017 at 11:12AM

Hi, thanks for reading.

Good advice re the car/home insurance.

I'm tied into the Sky contract until next July unfortunately. It's the full package, sports, movies, broadband and phone line.

My wife is aware and it's actually her circumstances that have changed and freed up some money for me. Until two months ago I was the main earner and a lot of this debt was built up just trying to make ends meet. She is now in a better job earning twice what she used to. We have agreed to let me go at this for at least a year so that the impact on family life and the kids is limited.

Suffolk_lass · 29 October 2017 at 2:38PM

While you are talking to the debt collection agencies you have nearly a thousand pounds with Capital One where you are paying almost 40% (£400 on £1000) interest. That actually means that over a year, that debt will increase based on just £27 a month paid off it. The capital owed would be approx £60 more than you are paying off.

You need to talk to them to ask if this can be frozen and prioritise this debt if it is still accruing interest. With your credit history (indicative of defaulting) I would be surprised if any 0% CC deals are open to you. You could talk to the credit collection agencies and ask them to amalgamate debts - I notice you have at least two with two agencies. I wonder if one of them would take on the Capital One balance so that you can consolidate and pay down in an organised way.

You may want to do this flying solo but I really feel you should talk to either CAB or Money Advice Service about your debts. Well done for taking the first step of facing and quantifying. Now you need help to develop a plan to deal with them

stvn1 · 29 October 2017 at 5:20PM

I definitely won't get a 0% credit card, my credit rating is poor. I have considered contacting Step Change but I honestly feel like I can cope with this.

My plan is to contact Lowell first of all and see what arrangement I can come to with them. I intend to seek partial settlements and thereby reduce the overall amount I have to pay. I'm aware that these will stay on my credit file for 6 years.

If I can focus on clearing one at a time, starting with the smallest I should get through them fairly quickly, especially if I can negotiate reasonable discounts.

I hadn't considered the Capital One card. I don't think I'm quite ready to let it go yet. That's possibly the wrong attitude, I'll give it some thought.

Florence_J · 29 October 2017 at 6:24PM

Welcome to the world of MSE and congratulations on starting a DFD. The first step is always the hardest.

I will echo what other people have said, and that is involve either your partner or someone like step change or CAB, or at least keep them in the loop because paying back debt is quite lonely and a hard journey. But starting a diary on here is a good start.

Good luck!

What a mess...

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