Struggling with debt? Ask a debt adviser a question

Hi

I’m glad to hear you found Linsi’s reply helpful.

Creditors often ask for full details of the household income and expenditure. This is because they want to make sure that what you’re offering is fair based on what is left after you’ve paid your household bills and general living costs.

Your partner isn’t responsible for debt in your name and can’t be made to pay anything towards it. However, what they’ll be trying make sure of is that you’ve not said that you pay all the household bills and your partner doesn’t contribute which is why you’re unable to keep up with the contractual payments. They’ll want to make sure the payment their being offered is fair.

You don’t have to provide this information but they might be more negotiable and accepting of the reduced payment if you do provide a full household budget.

Credit cards are not secured to a property and their collection process is limited. They are only entitled to what is affordable but they do have further rights of collection. If a contractual payment is reduced or missed and they aren't happy with the offer of a reduced payment they might decide to follow the collections process.

You can find out more about the collections process here.

I know Linsi already mentioned but if you would like further support you can find StepChange's contact details here.

Best of luck.
Rachael

Gellerbing wrote: »

Hi, thank you for your reply. I received a letter from one of the companys this morning, they have closed my account which is good, but they are asking for details on what my partner earns. The debt is not part of a joint account and i definitely don't want him to be pestered into contributing payments as this is my debt not his. If i provide his information will they expect him to pay something?

Hi

Thanks for getting in contact.

There are options available but it depends on your situation as to what would be the best route for you.

Where you have funds available at the end of the month to pay a lump amount towards the overdraft to pay it off this is the best option. It’ll stop any impact on your credit file, it’ll mean you’re maintaining a minimum payments and paying more than the interest so slowly reducing the debt.

Of course this is only possible where you can afford to do that.

As a debt advisor I wouldn’t advise on further borrowing, generally the interest and charges can be high and it can cause further problems. If someone could afford a lump sum each month to reduce the debt and this option would reduce the interest and charges, then this for some people is a good option.

As you’ve mentioned, this option depends on being able to take out more credit. There are soft searches you can do but it’s never certain until you apply. This can be a risk if you’re worried about your credit file.

If you’re struggling to make any payments towards the overdraft then it might be worth exploring alternative debt solutions. However, there’s likely to be some impact on your credit file when looking at debt solutions.

If you want to look into your options and get some debt advice you can use Debt Remedy, which is an anonymous online self-help tool.

It mainly comes down to what is important to you, reducing and paying back the debt as soon as possible to become debt free and letting your credit file recover over time, or trying to limit the immediate impact and take a hit with the charges.

Credit files do improve over time and credit files are affected by many factors.

I hope going forward you're able to find the best solution for you.

Thanks
Rachael

AzzA101 wrote: »

Hello!!

Would you be able to provide me with some advice in regards to an overdraft please?

I have had an overdraft for some time now and since getting married me and my wife now have a joint account so the account with the overdraft has not been used for well over a year.

The overdraft is bordering on £1000 and the charges alone are £7 a month. I tried getting a credit card to a credit transfer but I have not applied because the pre application that those websites offer told me if I did apply I would not be accepted. I do have a good credit rating though but I assume the problem is that I left full time eployment in March to go to university and since leaving uni I have had a full time job but its only on a temporary contract.

I thought that I would contact the bank and asked if I could close the account to stop the charges and set up a standing order from my joint account to pay it off. They said that it was possible to do so but it would make a good dent into my good credit score, which put me off going down that route!!

I was wondering if you had any suggestions in regards to this and if there are any other options I could take?

Thank you!!

Hi

Thanks for your post.

I appreciate it can be really difficult managing a budget and paying back the debts but it certainly sounds like you’ve got a good plan in place, as long as you feel it’s affordable.

By paying more than the minimum payments you’ll be paying off chunks of the debt and the creditors won’t be able to take collections action against you. It also means you’ll be maintaining your credit rating. It’s worth bearing in mind that a good credit rating is really only useful for creditors for further lending.

It’d be worth speaking with the creditor you’ve gone over the limit with and explaining that you’re aware of the situation and do intend to get back within the limit when you’re paid. It’s probably unlikely they’ll look at further action if you’re regularly making payments to the card and meeting the minimum payments, but you can check the terms and conditions in the credit agreement for confirmation on this. There is likely to be charges added for going over the limit.

If you find you’re struggling with your household bills and living expenses after budgeting and having to use the credit to top up, then it’d be worth looking at other options and getting some debt advice.

If you want to look at your options you can use Debt Remedy which is an online self-help tool to access tailored debt advice.

Hope this helps
Rachael

Seshwan wrote: »

HI,

Hoping you can give me some advice.

I am 24 years old and have 2 credit cards. Due to my own stupidity I have just maxed one of them out and actually went £200 over on it so it currently stands at £2500. The other one is at around 1800.

The bank for the maxed out card has stopped any transactions until I pay the £200 that I went over however I do not get paid until this coming Monday so won;t be able to pay it until then, will this be a problem?

I was wondering what the best way to get these paid off is? I currently have direct debits going to them for £100 each and my plan was to just cut up/hide both cards, leave the direct debits paying them off and whenever I get overtime at work ( Fairly frequently) pay that off as a one off payment each month on top of the £100 DD.

Is this the right thing to do or is there a better way?

I appreciate this is not a huge amount of debt compared to some in this thread however I really do not want to get any further into debt and want to get rid of this ASAP.

I have 100% learned my lesson in terms of overspending and putting things on credit cards.

Thought it would be worth adding that last time i check a few months ago, my credit score was 999.