What's the worst that can happen?

[cashdesk]

My wife and I can no longer afford to pay our non-priority debts.

We have about £150 left over after priority debts and our non-priority debts are currently costing us about £1300 a month.

We have written to our creditors offering them what we can afford based on the amount we owe each one. Some get £1, the most one gets is £40. We also sent a postal order for £1 to all credit card companies we owe money to, asking for a true signed copy of our agreement.

We had to get our boiler replaced recently and that has put us into an overdraft of £3000, which we haven’t figured into our calculations.

What is the very worst that can happen to us? I have heard that a creditor can make us bankrupt if we owe more than £750. Are they likely to do this? We own our home but it is in negative equity, but will this prevent them from taking such action? Do they HAVE to accept our reduced payment offer? Can they take us to court?

Sorry, so many questions, but we have always paid our bills and this is something we never considered.

[supasnooper]

hi there,

 

How have the creditors reacted to your reduced payments.....some are understanding, others are not ?

 

The creditors will accept reduced payments but that will not stop some of them who may wish to pursue legal action.

 

As you have read, certain creditors may pursue for bankruptcy by issuing a Statutory Demand.

Others may pursue for a County Court Judgement, which if unpaid, may lead to further actions.

 

However, this is a long, long way from where you at right now, and here at CAG you'll get some good advice in your battles against the creditors.

 

You have done the right thing in requesting your Credit card Agreements - Once you receive them, start a new thread for each creditor in the relevant forum, scan & post up the agreement (after blanking out all identifying data) and I'm sure the relevant advice will be posted.

 

Have a good look around the site as there will be even more info which may be relevant to your situation.

 

Also, look at this website as there is lots of good advice there as well -

 

National Debtline – Free, Confidential Debt Advice – Call 0808 808 4000

 

And remember, there are no stupid questions here at CAG - The only stupid question is the one that isn't asked.

 

Around how old are the debts ?

[cashdesk]

We only cancelld the direct debits last night, with 90% of them having just been paid. We will be posting the letters out to them tomorrow by registered post and await the phone calls and threatening letters.

 

Most of the credit cards are about 5 to 8 years old, with just a couple having been opened recently (last year) and they only have a minimal balance (£200 or so).

[supasnooper]

Ok,

 

I don't know what you've put in the letters but it may be worth mentioning that you will only deal with the accounts in writing.

 

There are template letters available on the site -

 

The Consumer Forums - Debt collectors

[cashdesk]

Well, I cancelled all my direct debits with my bank 2 days ago and they called this evening "as a courtesy", but I had to put the kids to bed and couldn't talk to them.

 

I am worried that I have an overdraft of £3050 with them that I cannot pay, so it is going to be another creditor that I have to account for.

 

If only the government had given each adult a share of the £1.4 Trillion instead of giving it to the banks, we would all have a little extra, could pay our debts, the banks would get their money and the profit they made would go to the government to repay their 'loans' to us. Instead the banks get the lot, refuse to lend our money back to us and then cry foul when we can't meet our payments because we can't find work due to the climate they have created.

[cerberusalert]

Have you opened a 'parachute' a/c with another unrelated bank, otherwise if you are still using this current a/c any monies you pay in will be swallowed up with charges and them trying to offset between accounts (credit card payments being taken from the a/c etc).

[cashdesk]

Yes, I opened a new account a couple of weeks ago.

[cerberusalert]

For your overdraft, if there are any 'unfair' charges which they have added, you can send a SAR; http://www.consumerforums.com/resources/templates-library/86-debt-collectors/576-subject-access-request-debt-a-dca this will cost £10 & amongst other information you'll receive copies of bank statements which will allow you to calculate the charges which you can reclaim, hopefully reducing the outstanding overdraft.

[cashdesk]

The overdraft is an arranged on of £3700, which I have not exceeeded, so there are no charges... yet.

[cashdesk]

Well, the first of the letters arived today from Amerian Express. They tell us that they may have to issue a default notice. What does that mean? Does it mean we have to go to court?

 

They also said we should ring them within 7 days so that they can go through our financial details and perhaps qualify for some free debt help scheme they operate. I think it is more likely that they want to convince us to make bigger payments.

 

I will reply thanking them for the offer but we would much rather communicate via mail or e-mail from now on, so that we can maintain an audit trail due to the fact that they will be issuing the default notice.. Oh, and by the way, where is the credit agreement we asked for?

[cerberusalert]

Well, the first of the letters arived today from Amerian Express. They tell us that they may have to issue a default notice. What does that mean? Does it mean we have to go to court?

It is a legal requirement they have to fulfill. They have to give you the opportunity to remedy any arrears before they can default your credit file. Don't worry it is normal & nothing to do with court. With luck they might send a defective default notice which would be extremely useful to you.

They also said we should ring them within 7 days so that they can go through our financial details and perhaps qualify for some free debt help scheme they operate. I think it is more likely that they want to convince us to make bigger payments.

It's their attempt to get you to 'phone them so they can badger you. Do not speak to them on the 'phone, everything needs to be in writing. in that way it leaves a nice paper-trail, besides they'd never commit to paper what they would say on the 'phone.

[cashdesk]

Thanks cerberusalert, that is most reassuring. We will get the response to them over the weekend