Ashamed, i need some help!

paulcornwall · 9 February 2007 at 1:52AM

I'm so glad the internet is here, i could'nt face telling someone face to face my situation. After numerous years swapping and changing creditors for better interest rates, the !!!! has now hit the fan.
The vast majority of my finance was taken out when i was on very good money and monthly payments were a breeze. For the last 18 months i've had to go on incapacity benefit due to illness. We have just had a little baby girl and wont to get out of this mess pronto.
I'm hoping to get back into Work shortly (aiming for 8 weeks) however will only be doing Part time initially due to my illness ( i wont go into that).
I'm concerned the majority of my benefits will stop if i go back part time and make payments even more difficult.
At the beginning of last year i consolidated alot of my credit cards into a loan in my mothers name as she got a very good rate, i have been thinking about a IVA however i beleive the credit will need to be in my name to be accepted, this evening i have been trying to working out available credit on my cards so i can pay my mum back and the credit is then in my name, i know the rate wont be as good but at least it could be included in a IVA.
Here are my problems

DEBT

Northern Rock £13k @ 5.9% in mothers name £142.37 over 10 yrs

Cahoot loan £7227 @ 14.9% £150 per month flex loan min payment

Student loan £3000 approx @ unknown rate, no payments due

Hutchinson Credit £2600 @ 5.9% £100 p/m over 24 months (starts nxt month)

Barclaycard £2700 @ 6.9% £54 p/m minimum payment

Barclays addition overdraft £1700 @gods knows/ been here for a while

Barclays Graduate loan £96 left 2 payments left of £51

On my credit cards i have available
£5800 available Barclays
£8000 available MBNA
£3000 avaialble Paypal
The reason i mention the avaialble credit is to pay off my mum and get the debt in my name.

other outgoings:

Internet £5p/m
2 contract phones £70 p/m
account fee £11.50
Water £35 per month
Food £200 per month
Petrol £100

Now here my income:

Incapacity benefit £400 p/m

Child Benefit £69.80 p/m

Housing Benefit £357.68 p/m (our rent is £550 and included gas and electric)

Maternity allowance £428 p/m (will be stopping shortly)

Family tax credit £200 p/m

Other income ebay etc: £300 average p/m

Please help guys, i am so ashamed of myself, its killing me with these payments and cant carry on for the nxt 10-15 yrs like this. I really like the idea of a IVA, should i go for it now or wait till i get a part time job, my income is likely to decrease though. All your help is much appreciated. thanks Paul.

lxpeanut · 9 February 2007 at 3:14AM

Do not feel ashamed many people here are in a similar situation.

The debt will need to be in your name to be included in an IVA. You also need to work out your income and outgoings very carefully as they are not flexable. Wait untill you know what you will have coming in working part time. In the meantime contact one of the debt counseling charities and get their advice. An IVA may not be the best solution for you.

CFC · 9 February 2007 at 4:14AM

You would need to repay the debt in your mother's name. As it appears to be a loan, you will have to pay extra probably if you redeem the loan early. You will need to do this I think in order to move it to your credit cards.

Your problem with an IVA may be that I think you must have at least £200 a month to make repayments towards your debt, however I am not guaranteein that is correct information. In your outgoings, you don't mention other essentials such as gas or electricity, so I think that your SOA is flawed.

You need to do a proper SOA and then some folk who have more knowlede of IVAs than me will be along to help you, and they'll have enough information to do so.

You might also want to take a look at the cccs website, this is a registered charity which will give you impartial and helpful advice on your debts and your options.
www.cccs.co.uk

smashedbooboo · 9 February 2007 at 7:22AM

Hi, first of all do not be ashamed. We are all on here because of things that have happened to us. and welcome to the forum. I cant give you much advice in the financial side but can give you support and a friendly ear. You are not alone anymore and you will get great advice here. Take a deep breath and understand that you are now on your first steps to becoming debt free, Good luck chick. xxxx

robnye · 9 February 2007 at 9:35AM

contact barclaycard and mbna regarding long term low interest debt transfer........otherwise it will be at the standard rate

raq · 9 February 2007 at 10:20AM

I agree, don't feel ashamed. There are some great people and fantastic advice on this site. If it wasn't for these people I would have ended up walking out in November, with nowhere to go and there wasn't any reason for it. Once I told my husband he was FAB, and since when we are trying our best to clear as much debt as possible. Doesn't matter if it's £1k or £41k it's always on our mind.

Good luck and chin up and of course enjoy your new arrival. There not little for long

paulcornwall · 9 February 2007 at 12:43PM

With a IVA, woud'nt surplus income be created i.e the £200 needed once the proper payments cease? Whats stopping a IVA?

paulcornwall · 9 February 2007 at 12:43PM

With a IVA, woud'nt surplus income be created i.e the £200 needed once the proper payments cease? Whats stopping a IVA?

clarab_3 · 9 February 2007 at 12:49PM

I'm afraid Im no expert on IVAs but I just wanted to say not to be ashamed, these things happen and it gets easier to talk about over time. The kick you'll get out of doing something about it will make you want to sing from the rooftops

Hope I can help in more practical ways later.

C

MIVAA · 9 February 2007 at 2:18PM

Hi paulcornwall

Don't feel ashamed, feel courageous. Taking the plunge and asking for help takes no small amount of guts.

OK heads up, some info for you!

It is true that you can only enter debts in your name into an IVA.

But there are some other things you need to be aware of too.

1) If you move the N.Rock debt that's in your Mums name on to your credit cards, and then immediately include the credit card debt into an IVA proposal, the chances are the creditors, who now find themselves sharing the ex N.Rock debt, will call foul, and reject your proposal. This is because each debt being put into an IVA proposal ought to be at least as a bare minimum 6 months old and technically 1 year old to qualify for the IVA. Credit cards are treated differently in practice, so long as the debt on the cards has been accrued on general living expenses, not a balance transfer of such size. They would consider you had shown a preference by repaying N. Rock in full.

2) MBNA have made some quite significant changes to their minimum criteria for IVAs recently, thus making it more difficult to gain their approval. If you were to 'fill up' your MBNA card to the max, they would have, or be very close to, a casting vote in the IVA based on the figs you have given, so their decision to accept or decline your IVA would be critical.

3) Because your income is likely to change very soon, an IVA would be inappropriate at the moment. You should really only consider proposing an IVA when your circumstances have settle and you are in a position to make a solid offer to creditors. If you were to transfer the balances to the credit cards you would need to wait anyway, so an IVA option might fit in quite nicely in time.

If you contact CCCS and have a chat with them about your situation, they will guide you as to your best option for the moment, but from the limited info available I would imagine that a DMP would be the most suitable for now.

Good luck in any event.

paulcornwall · 9 February 2007 at 2:25PM

Thanks guys, its not easy talking about this, but something needs to be done. If i balance transfer the payments are likely to be higher on the cards than the N rock loan, i'm unsure if i can keep up regular payment for 1 yr before opting for a iva, however if this is the case, i must try. Going to call CCCS now.

Ashamed, i need some help!

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