Working hard but still in debt

fatbelly · 13 March 2017 at 10:07PM

A full & final (F&F) settlement is where you offer a lump sum of less than 100% of the debt and the creditor agrees to accept this and not pursue the remaining amount.

There is a factsheet here:

https://www.nationaldebtline.org/EW/factsheets/Pages/fullandfinalsettlementoffers/lumpsumoffers.aspx

The advantage of doing a self-managed dmp rather than using stepchange/payplan is that you can make F&F offers as it suits you.

Regarding the telephone calls, you can and probably should request that everything is done in writing. There are some rules you can quote. But it may be easier to change your phone number.

Muppetmagic · 13 March 2017 at 10:23PM

Hi i spoke with a debt advisor who advised me of my options, I used a company called Faith Financial, they will take all your details, including ur income and ur debts and advise ur options, there are 5 main options for dealing with debt.

1. Bankrupsy
2. Informal Agreement
3. Consolidation Loan
4. Debt management ( up to £5000 of debt only)
5. IVA

I was at a lose end with no idea how I was going to clear my debt, there are lots of companies who offer free debt advise and can advise you the best options, that wot I have done and they are supporting me through the process of applying for an IVA, I owe about £22,000 with loans, overdrafts and credit cards

enthusiasticsaver · 14 March 2017 at 4:16AM

StrugglingWithDebt87 wrote: »

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 1
Number of children in household......... 0
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 2460
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 100
Total monthly income.................... 2560

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 270
Rent.................................... 400
Management charge (leasehold property).. 0
Council tax............................. 0
Electricity............................. 0
Gas..................................... 0
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 60
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 150
Clothing................................ 70
Petrol/diesel........................... 30
Road tax................................ 11.5
Car Insurance........................... 60
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 48
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 20
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 50
Haircuts................................ 40
Entertainment........................... 100
Holiday................................. 100
Emergency fund.......................... 0
Total monthly expenses.................. 1429.5

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 13000
Other assets............................ 0
Total Assets............................ 13000

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 0........(0)........0
Hire Purchase (HP) debt ...... 10400....(270)......3.2
Total secured & HP debts...... 10400.....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Aqua...........................5400......180.......40
Vanquis........................2500......180.......40
Natwest........................2500......50........20
Lending stream.................700.......200.......700
Quickquid .....................1700......97........0
Wonga..........................1000......396.......1900
Very account ..................7200......400.......37
New day........................700.......25........30
Very...........................200.......10........35
Capital one....................200.......10........35
Barclaycard....................1600......25........35
RBS ...........................600.......14........20
Total unsecured debts..........24300.....1587......-

Monthly Budget Summary
Total monthly income.................... 2,560
Expenses (including HP & secured debts). 1,429.5
Available for debt repayments........... 1,130.5
Monthly UNsecured debt repayments....... 1,587
Amount short for making debt repayments. -456.5

Personal Balance Sheet Summary
Total assets (things you own)........... 13,000
Total HP & Secured debt................. -10,400
Total Unsecured debt.................... -24,300
Net Assets.............................. -21,700

Created using the SOA calculator at
Reproduced on Moneysavingexpert with permission, usin

That soa can be reduced by not buying clothes, just wearing stuff you already have, getting rid of holidays until you are well on debt reduction path and reducing groceries to £100. The mobile phone bill, haircuts and gifts could also be halved at least.

I would double check your figures on the car situation. Will you really get £13k in cash for it? Make sure that this is doable as cars are massive depreciating assets and £13k for a used car may not be that easy to realise. That must have been one expensive car to buy if it is still worth £13k 3 or 4 years later.

enthusiasticsaver · 14 March 2017 at 5:06AM

Unless most of those lenders agree to stop charging interest or you get lump sums back from the PDLs (I am sceptical about that in the short term) a DMP may be the only option if you cannot go for bankruptcy. That way at least no interest is charged.

No help to you now but this could all have been so different had you had some financial education in your late teens and credit became available. My daughters are your age and from their early teens I warned them of the evils of credit as I was a debt counsellor in the 90s and saw what effect the debt spiral had on people's lives. Consequently they shied away from credit cards, in fact we had to insist our younger daughter applied for one at 24 when she went to the states and we thought she needed a backup source of finance and said it was good for when she applied for a mortgage to show she could handle cards well. It makes me angry that PDL and sub prime lenders like Vanquis etc which charge extortionate rates are allowed to keep lending even when someone like yourself clearly could not afford it. The first mistake was made at 19 when you took out the first car loan but that was more than 10 years ago and you have spent the first 10 years of your working life battling debt with nothing to show for it. It is a credit to you that you have managed to build a good career in spite of this.

My advice would be, bite the bullet and speak to stepchange. Get a basic bank account for your salary, essential bills which is really only rent in your case. Form a budget as to what you need to live off re clothing, entertainment, mobile phone bill, travel etc and then default on the unsecured loan payments. Not sure what to advise about the car as I am not sure if you are allowed to keep assets worth more than £1k unless essential for work. With your disposable income you would be debt free in around 2 years then have 4 minimum to build up a healthy deposit for a house at some point in the future. A DMP will affect your life but many have said it is the turning point.

fatbelly · 14 March 2017 at 6:41AM

Muppetmagic wrote: »

Hi i spoke with a debt advisor who advised me of my options, I used a company called Faith Financial, they will take all your details, including ur income and ur debts and advise ur options, there are 5 main options for dealing with debt.

1. Bankrupsy
2. Informal Agreement
3. Consolidation Loan
4. Debt management ( up to £5000 of debt only)
5. IVA

I was at a lose end with no idea how I was going to clear my debt, there are lots of companies who offer free debt advise and can advise you the best options, that wot I have done and they are supporting me through the process of applying for an IVA, I owe about £22,000 with loans, overdrafts and credit cards

Please start your own thread.

That summary is incorrect. Faith Financial appear to make their money from IVA referrals and so it is no surprise that is where you ended up. I have looked at their website and much of the information there is wrong (bankruptcy) or just not there (Debt Relief Orders).

If it's not too late for you, have a chat with an impartial organisation like National Debtline.

Working hard but still in debt

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