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    • Nicole92
    • By Nicole92 11th Jan 18, 1:07 AM
    • 1Posts
    • 1Thanks
    Overwhelmed by the debt black hole spiral
    • #1
    • 11th Jan 18, 1:07 AM
    Overwhelmed by the debt black hole spiral 11th Jan 18 at 1:07 AM


    To put it lightly I'm in an absolute monetary black hole.
    Back in 2012 I turned to payday loans to get through my final year at uni. I Had only qualifies for the most basic amount to just cover rent and due to my course couldn't commit to more than 16 hours per week to cover monthly outgoings. By this point I was fully into my student overdraft of 1.5k. I had asked my parents for financial help but they said they couldn't afford to, which was why I had turned to the payday lenders, inevitably the payday loan cycle Began.

    I moved back home and have had to pay rent plus food, bill contributions, phone bills etc, none of which I object to and have held down a series of part time or full time jobs, never paying more than minimum wage. I didn't want to tell my parents about the debt cycle, but they found out and took me down to the CAB in January 2015, who set up a DMP for me, covering the payday lenders, credit card, student overdraft at a total of 5k. 6 months after this, they closed my case and I have tried to manage the plan and the reviews with my creditors myself. During this time, my parents have increased my rent, done things such as take away my sole debit card, check and scrutinise my bank statements on a weekly basis, where I feel like I am having to justify every transaction I've made, even those accounted for on my SOA.

    Fast forward to last year.

    I land my dream job, still only minimum wage but it's the only one in my area which is full time, paid and in my industry. It's all going well until my boss moves us from monthly to weekly wage payments with 2 weeks notice, coinciding with a costly car repair and a broken mobile phone. I have no savings, no emergency funds, I asked again for help from the parents, who then disclosed that they coudnt, because they themselves had run up debts of 35k on credit cards and were relying on my rent for their own emergency, which I couldn't afford to pay. All of this before I had even told thwm about the change in pay schedule. So I was stupid and turned to payday loans to plug the gap and the spiral happened again. Everything I have paid off of my debts, about 2k has been reborrowed, and I now owe 6.5k. I've spoken to Gregory Pennington who were recommended to me on the advice of a colleague, and they were meant to be taking weekly payments, instead they have taken monthly payments leaving me again unable to pay rent. I can't sleep, my health is under strain, I'm stressed all the time and I'm getting daily interrogations from my parents about my debts, as they have figured out something is going on. I'm 25, can't afford to rent privately in the area and I feel like I will never have control over my money, if anything it has control over me. I wish I had never even heard of payday loans and I am just so overwhelmed with it all I'm struggling to cope. I've struggled to maintain a debt management plan and I'm struggling with the situation at home, as I know I'm in for an extremely negative reaction that I don't know if I'm strong enough to cope with.
Page 1
    • January2015
    • By January2015 11th Jan 18, 2:01 AM
    • 2,089 Posts
    • 5,181 Thanks
    • #2
    • 11th Jan 18, 2:01 AM
    • #2
    • 11th Jan 18, 2:01 AM

    Don't panic. Lots of help and advice on this forum.

    First and most importantly cancel your debt management plan with Gregory Pennington. They charge you to deal with your debts - a whopping 18.5% of what you are paying is not even clearing your debts.

    Visit one of the free debt advice services such as Stepchange, Christians Against Poverty, or National Debtline. They will all help you for free so every penny you can afford will go to clearing your debts.

    As a starting point, perhaps visit the Stepchange website and complete their debt remedy tool. It will give you an idea of what is the best debt solution for you. Be realistic about your expenditure. Don't skimp and not include money for haircuts, sundries, etc. If you do this you will never be able to keep up with any debt management plan because you will find you need those things and you haven't allowed for them - that's when it all starts to fall to pieces.

    Whatever, creditors cannot have what you can't afford. There will be solutions for you. These may be another DMP, or perhaps a debt relief order (DRO) or possibly bankruptcy.

    If you can cope with filling out and posting a statement of affairs (SOA) others will come along and give you advice.

    Don't stress (easier said than done, but please try). Okay, things I recommend you to do....
    1. Don't pay Gregory Pennington anymore money (cancel any bank standing order/direct debit you have to them and write to them today to cancel your plan with them).
    2. Start moving towards finding an affordable debt management solution for you, e.g. Stepchange debt remedy tool.
    3. Write to all your creditors and advise you are cancelling your DMP with Gregory Pennington and are seeking support from a debt charity.
    4. Advise you will not be able to make payments for a few months (you choose how many you feel comfortable with) and ask they freeze interest and charges (if they haven't already) to enable you to deal with your debts.
    5. When you write, make sure you include a sentence which says you do not give permission for them to contact you by phone and that all communication must be in writing. As long as you respond to their letters they have to adhere to this request.
    6. Use the money you are not paying in monthly DMP payments over the next few months to build yourself an emergency fund.
    7. Come back here and post an SOA so that others can give you advice.
    8. Don't be tempted to go near another payday lender

    Don't be scared of creditors. You are not known to them personally. You are just an account and believe me they see hundreds of accounts not being paid every day. They receive loads of letters where people are having to seek support to clear their debts.

    I know your debt figure seems insurmountable to you at the moment but please believe you can sort this. I owed over 95k 3 years ago. Once you get the right solution in place life becomes not just bearable, but enjoyable and at the same time you see your debt balance start to reduce.

    Perhaps talk to your mum and dad and make a deal to work through this together and support each other.
    Last edited by January2015; 11-01-2018 at 2:14 AM.
    DFW Nerd No. 1484 LBM 07/01/15 Debt was 95k I'm driving it down
    1k emergency fund (member #84) 1k/1k
    • enjoyyourshoes
    • By enjoyyourshoes 11th Jan 18, 8:00 AM
    • 1,061 Posts
    • 1,302 Thanks
    • #3
    • 11th Jan 18, 8:00 AM
    • #3
    • 11th Jan 18, 8:00 AM
    Scrutinise all of your spending and identify spending for NEEDS and WANTS, then ditch the WANTS. Throw this money against the debts.

    A mobile phone is a WANT.

    Good luck
    Debt is a symptom, solve the problem.
    • Pixie5740
    • By Pixie5740 11th Jan 18, 9:10 AM
    • 12,173 Posts
    • 17,195 Thanks
    • #4
    • 11th Jan 18, 9:10 AM
    • #4
    • 11th Jan 18, 9:10 AM
    I second the advice to skadoosh Gregory Pennington. Never, ever pay for debt advice. There are three great debt charities in the UK that can help and support you for free:
    • CAP UK
    • National Debtline
    • Step Change

    How did Gregory Pennington take the money? If by direct debit then you can contact your bank/building society to have the money returned under the direct debit guarantee if the wrong amount was taken i.e. a weekly sum was to be taken, not monthly.

    Next step is to put together a SOA. Post it here if you want some suggestions on how to trim it or debt options available to you. It could be that a form of insolvency is a better option for you than a DMP.

    If you've taken out multiple pay day loans it's worth finding out if you might be able to reclaim money from any of the PDL lenders.

    Reclaiming money from various payday loan companies

    Most importantly remember that it's only money and worse things happen at sea.
  • National Debtline
    • #5
    • 11th Jan 18, 12:48 PM
    • #5
    • 11th Jan 18, 12:48 PM
    Hi Nicole

    There's nothing here that we haven't seen or dealt with before, so rest assured there are viable, workable (and most importantly, fee-free) solutions available.

    Get in touch with one of the free debt charities as recommended further above - this forum can give you some good nudges but the charities can cover things more comprehensively.

    In the meantime, you should look to cancel any "continuous payment authority" you may have given to the payday lenders to take payments from your bank account. Further advice on this and a letter template you can use can be found at

    We work as money advisers for National Debtline and have specific permission from MSE to post to try to help those in debt. Read more information on National Debtline in MSE's Debt Problems: What to do and where to get help guide. If you find you're struggling with debt and need further help try our online advice tool My Money Steps
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