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  • FIRST POST
    • Stressedmummy
    • By Stressedmummy 2nd Jul 18, 7:53 PM
    • 26Posts
    • 20Thanks
    Stressedmummy
    Advice please!
    • #1
    • 2nd Jul 18, 7:53 PM
    Advice please! 2nd Jul 18 at 7:53 PM
    Good evening everyone!
    So, due to various reasons I have found myself drowning in debt again
    I have finally gotten myself out of the ďdebt spiralĒ and am no longer using credit cards. My various minimum payments however are just crippling me. I set out at the beginning of the month with the best intentions, I had set myself the ďsnowballĒ challenge and have cleared the smallest debts. But I canít even meet all my minimum payments anymore and itís the classic case of robbing Peter to pay Paul.
    I have switched utility providers and set myself a budget, I am not overspending anywhere, I just simply donít earn enough to cover the debt payments.
    So whatís the best solution? I donít really want to go down the DRO route if I can help it.... is there another way of just bringing down my minimum payments to a manageable amount? Or reducing the interest? I am not eligible for any balance transfers.
    I get paid tomorrow, and one credit card minimum payment is £137 and another is due the same week for £90 and thatís just this week! The following week I have another for £157.... I canít carry on like this, and at the moment Iím just thinking of giving up this juggling act and just defaulting on everything.
    Does anyone have any advice please?
    Thanks in advance, a very stressed mummy
Page 2
    • poppasmurf_bewdley
    • By poppasmurf_bewdley 4th Jul 18, 10:19 AM
    • 5,227 Posts
    • 5,343 Thanks
    poppasmurf_bewdley
    Having looked at your SOA, I can't see that you have any option but to go for the DRO.

    And I think you need to set about getting it done quickly before your situation becomes even worse.
    "There are not enough superlatives in the English language to describe a 'Princess Coronation' locomotive in full cry. We shall never see their like again". O S Nock
  • National Debtline
    Hi stressedmummy


    Having read the thread and looked at your SOA, my instincts too are that a DRO makes most sense. I wouldn't necessarily let that car valuation blow this out of the water altogether - bear in mind that will be a very general valuation and won't account for the specific condition of your vehicle. The mileage you do will probably mean the car's value is depreciating at a faster than average rate, so if it's not already worth <£1K, that may become the case quicker than you expect.


    By the time you redo that SOA to incorporate some realistic amounts set aside for car maintenance/clothing/birthdays/Xmas etc. (i.e. things that might previously have been stuck on a credit card), I suspect that there'll be very little left over and so a DMP won't be viable.


    On a separate note, I'm guessing that your property may have more than two bedrooms and that any housing benefit you may get only covers a smallish portion of the rent? I ask because the council tax seems very low for a property with such a high market rent value. I get it that you've no desire to move if the landlord has been charging below market rates for some time, as you may not necessarily save any money even by moving into somewhere smaller in that area.


    Why not get in touch with one of the free debt advice charities like us or Stepchange as others have suggested so we can look at your options in finer detail?


    Dennis
    @natdebtline
    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
    • Stressedmummy
    • By Stressedmummy 4th Jul 18, 11:11 AM
    • 26 Posts
    • 20 Thanks
    Stressedmummy
    Hi stressedmummy


    Having read the thread and looked at your SOA, my instincts too are that a DRO makes most sense. I wouldn't necessarily let that car valuation blow this out of the water altogether - bear in mind that will be a very general valuation and won't account for the specific condition of your vehicle. The mileage you do will probably mean the car's value is depreciating at a faster than average rate, so if it's not already worth <£1K, that may become the case quicker than you expect.


    By the time you redo that SOA to incorporate some realistic amounts set aside for car maintenance/clothing/birthdays/Xmas etc. (i.e. things that might previously have been stuck on a credit card), I suspect that there'll be very little left over and so a DMP won't be viable.


    On a separate note, I'm guessing that your property may have more than two bedrooms and that any housing benefit you may get only covers a smallish portion of the rent? I ask because the council tax seems very low for a property with such a high market rent value. I get it that you've no desire to move if the landlord has been charging below market rates for some time, as you may not necessarily save any money even by moving into somewhere smaller in that area.


    Why not get in touch with one of the free debt advice charities like us or Stepchange as others have suggested so we can look at your options in finer detail?


    Dennis
    @natdebtline
    Originally posted by National Debtline
    Thank you Dennis.
    My house is a small 2 bed terrace, the £60 council tax is a reduced rate for low income. I guess I should give them a call then. I'm so nervous
    • Stressedmummy
    • By Stressedmummy 4th Jul 18, 11:13 AM
    • 26 Posts
    • 20 Thanks
    Stressedmummy
    Having looked at your SOA, I can't see that you have any option but to go for the DRO.

    And I think you need to set about getting it done quickly before your situation becomes even worse.
    Originally posted by poppasmurf_bewdley
    Thank you poppasmurf
    • saajan_12
    • By saajan_12 4th Jul 18, 11:54 AM
    • 1,295 Posts
    • 908 Thanks
    saajan_12
    Sounds like you're doing your best on a tight budget, other posters can advise better on how to manage on the debt side. Only place I can see where you might be able to give yourself a little more room is here:

    Mobile phone............................ 45
    Originally posted by Stressedmummy
    are you still within a 12/24month fixed term in which you got a phone? If not, you can switch to a sim only, paying only £6-10 monthly once you take cashback into account.
    • Stressedmummy
    • By Stressedmummy 4th Jul 18, 12:58 PM
    • 26 Posts
    • 20 Thanks
    Stressedmummy
    Sounds like you're doing your best on a tight budget, other posters can advise better on how to manage on the debt side. Only place I can see where you might be able to give yourself a little more room is here:



    are you still within a 12/24month fixed term in which you got a phone? If not, you can switch to a sim only, paying only £6-10 monthly once you take cashback into account.
    Originally posted by saajan_12
    Thank you, yes this is the one bill I am trying to get down! There is £138 to pay off to end the contract, and then I'm ditching it for a PAYG, I would never get a contract phone again. This is the only bill I see with any wiggle room. Last year I argued my car insurance down, they tried to double it on the renewal and I have already changed energy supplier...
    • January2015
    • By January2015 4th Jul 18, 1:05 PM
    • 2,138 Posts
    • 5,244 Thanks
    January2015
    Thank you, yes this is the one bill I am trying to get down! There is £138 to pay off to end the contract, and then I'm ditching it for a PAYG, I would never get a contract phone again. This is the only bill I see with any wiggle room. Last year I argued my car insurance down, they tried to double it on the renewal and I have already changed energy supplier...
    Originally posted by Stressedmummy
    You can have a contract without buying a handset. I have an O2 contract with 5Gb of data, unlimited texts and unlimited minutes. That costs me £9 per month, which I don't thnk is bad. I also benefit from the O2 Priority moments app, which is not as good as it used to be but I can still benefit from some nice freebies / reductions (only if I was intending to purchase items anyway though )

    I think PAYG would cost me more than that (although I haven't checked).
    DFW Nerd No. 1484 LBM 07/01/15 Debt was £95k I'm driving it down
    £1k emergency fund (member #84) £1k/£1k
    • enthusiasticsaver
    • By enthusiasticsaver 4th Jul 18, 1:13 PM
    • 6,680 Posts
    • 14,163 Thanks
    enthusiasticsaver
    You need to up some of those categories when doing an soa in the future to get to a lower surplus than £157. You need something in car maintenance and entertainment/presents and emergency fund as you will have no access to credit. I would default immediately and divert the credit card payments to an emergency fund while you sort out the DRO. Write to your creditors and ask them to freeze interest for 30 days to give you time to sort it out.
    Debt free and mortgage free and early retiree. Living the dream

    I'm a Board Guide on the Debt-Free Wannabe, Mortgages and Endowments, Banking and Budgeting boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Any views are mine and not the official line of moneysavingexpert.com. Pease remember, board guides don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com
    • Stressedmummy
    • By Stressedmummy 4th Jul 18, 1:14 PM
    • 26 Posts
    • 20 Thanks
    Stressedmummy
    You can have a contract without buying a handset. I have an O2 contract with 5Gb of data, unlimited texts and unlimited minutes. That costs me £9 per month, which I don't thnk is bad. I also benefit from the O2 Priority moments app, which is not as good as it used to be but I can still benefit from some nice freebies / reductions (only if I was intending to purchase items anyway though )

    I think PAYG would cost me more than that (although I haven't checked).
    Originally posted by January2015
    Yes this is what I meant no handset contract
    • Stressedmummy
    • By Stressedmummy 4th Jul 18, 1:15 PM
    • 26 Posts
    • 20 Thanks
    Stressedmummy
    You need to up some of those categories when doing an soa in the future to get to a lower surplus than £157. You need something in car maintenance and entertainment/presents and emergency fund as you will have no access to credit. I would default immediately and divert the credit card payments to an emergency fund while you sort out the DRO. Write to your creditors and ask them to freeze interest for 30 days to give you time to sort it out.
    Originally posted by enthusiasticsaver
    Thank you, so I should write to them before starting the DRO? Would I need to include a budget in the first letter?
    • enthusiasticsaver
    • By enthusiasticsaver 4th Jul 18, 1:16 PM
    • 6,680 Posts
    • 14,163 Thanks
    enthusiasticsaver
    Make sure you open a basic account with no overdraft with a bank which is not Halifax.
    Debt free and mortgage free and early retiree. Living the dream

    I'm a Board Guide on the Debt-Free Wannabe, Mortgages and Endowments, Banking and Budgeting boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Any views are mine and not the official line of moneysavingexpert.com. Pease remember, board guides don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com
    • enthusiasticsaver
    • By enthusiasticsaver 4th Jul 18, 1:17 PM
    • 6,680 Posts
    • 14,163 Thanks
    enthusiasticsaver
    Thank you, so I should write to them before starting the DRO? Would I need to include a budget in the first letter?
    Originally posted by Stressedmummy
    I would not as they all have their own soa. Some may ask to see it but if you use stepchange they may liaise with them all for you. Contact them first and see what they suggest.
    Debt free and mortgage free and early retiree. Living the dream

    I'm a Board Guide on the Debt-Free Wannabe, Mortgages and Endowments, Banking and Budgeting boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Any views are mine and not the official line of moneysavingexpert.com. Pease remember, board guides don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com
    • enthusiasticsaver
    • By enthusiasticsaver 4th Jul 18, 1:23 PM
    • 6,680 Posts
    • 14,163 Thanks
    enthusiasticsaver
    https://www.stepchange.org/how-we-help/debt-relief-order.aspx

    I would put £50 in the emergency savings, £50 in car maintenance as you do high mileage and the car is low value then split the remaining £57 between presents, haircuts, entertainment.
    Debt free and mortgage free and early retiree. Living the dream

    I'm a Board Guide on the Debt-Free Wannabe, Mortgages and Endowments, Banking and Budgeting boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Any views are mine and not the official line of moneysavingexpert.com. Pease remember, board guides don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com
    • enthusiasticsaver
    • By enthusiasticsaver 4th Jul 18, 1:24 PM
    • 6,680 Posts
    • 14,163 Thanks
    enthusiasticsaver
    What about insurances? Do you have life assurance within an occupational insurance as you have a child. Contents insurance is cheap and a must have.
    Debt free and mortgage free and early retiree. Living the dream

    I'm a Board Guide on the Debt-Free Wannabe, Mortgages and Endowments, Banking and Budgeting boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Any views are mine and not the official line of moneysavingexpert.com. Pease remember, board guides don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com
    • enthusiasticsaver
    • By enthusiasticsaver 4th Jul 18, 1:26 PM
    • 6,680 Posts
    • 14,163 Thanks
    enthusiasticsaver
    How old is your child? Can you work more hours as I guess that £690 is a part time wage? The savings from not making credit card payments etc can pay the DRO fee and start off emergency fund. You will soon feel less stressed. Good luck.
    Debt free and mortgage free and early retiree. Living the dream

    I'm a Board Guide on the Debt-Free Wannabe, Mortgages and Endowments, Banking and Budgeting boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Any views are mine and not the official line of moneysavingexpert.com. Pease remember, board guides don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com
    • fatbelly
    • By fatbelly 4th Jul 18, 9:37 PM
    • 12,449 Posts
    • 9,497 Thanks
    fatbelly
    So I've looked up the value of my car and it's saying £1,495.....

    So looks like the DMP may have to be the way to go. So do I start with letters to them all? My vanquis payment was due to leave my account today but I cancelled the direct debit because last month it left me short... (minimum payment £167) Feeling very nervous now.
    Originally posted by Stressedmummy
    Really? Parkers Guide Poor Condition?

    You have maybe 3 options:

    1. Wait till depreciation brings the value under £1k. Then do a DRO. I estimate that will take just over a year. In the meantime I would stop paying non-priority creditors and start an emergency fund (you can enter a DRO with savings of up to £1000, separately from a £1k car)

    2. Sell the car and buy a cheaper one. You must sell at market price, though. Then do a DRO.

    3. Find a garage that will give you a written valuation of £990. Then do a DRO.
    • Stressedmummy
    • By Stressedmummy 5th Jul 18, 9:35 AM
    • 26 Posts
    • 20 Thanks
    Stressedmummy
    Really? Parkers Guide Poor Condition?

    You have maybe 3 options:

    1. Wait till depreciation brings the value under £1k. Then do a DRO. I estimate that will take just over a year. In the meantime I would stop paying non-priority creditors and start an emergency fund (you can enter a DRO with savings of up to £1000, separately from a £1k car)

    2. Sell the car and buy a cheaper one. You must sell at market price, though. Then do a DRO.

    3. Find a garage that will give you a written valuation of £990. Then do a DRO.
    Originally posted by fatbelly
    What happens if I just stop paying for the time being? I am going to get the letters printed out today that you previously linked to. I'm just feeling very nervous right now, hate not paying things on time
    Ahh also, I completed the "debt remedy tool" on stepchange, and the only solution they gave me was bankruptcy, with an activation fee of over £500
    • Stressedmummy
    • By Stressedmummy 5th Jul 18, 9:38 AM
    • 26 Posts
    • 20 Thanks
    Stressedmummy
    Make sure you open a basic account with no overdraft with a bank which is not Halifax.
    Originally posted by enthusiasticsaver
    A couple of people have said that now, what's wrong with Halifax?
    • Stressedmummy
    • By Stressedmummy 5th Jul 18, 9:43 AM
    • 26 Posts
    • 20 Thanks
    Stressedmummy
    How old is your child? Can you work more hours as I guess that £690 is a part time wage? The savings from not making credit card payments etc can pay the DRO fee and start off emergency fund. You will soon feel less stressed. Good luck.
    Originally posted by enthusiasticsaver
    Thank you.
    My daughter will be starting senior school this september. It's quite far and not on a bus route though so I will still be dropping her off for the time being. I'm looking for something closer to home with more hours. That's my other niggle about the DRO, what happens if I do find a job that earns more which is closer to home, my fuel cost will go down and I will earn more (which is obviously what I want!) but would that affect a DRO that is already active??
    • DMP_Tiger
    • By DMP_Tiger 5th Jul 18, 9:54 AM
    • 39 Posts
    • 36 Thanks
    DMP_Tiger
    A couple of people have said that now, what's wrong with Halifax?
    Originally posted by Stressedmummy
    You owe Halifax money on a credit card so they can use their right to offset and take any money that is paid into your current account.

    I'm beginning a DMP at this moment and had to move my current account away from Barclays for exactly that same reason.
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