Is there anyway to stop interest?

[indebtstudent]

And I've realized in doing this first draft that there are essential things missed out like card tax and servicing, but I was wondering is it best to tell the whole truth?

 

For example I have a least two sources that state it is reasonable for a couple so spend up to £338 on groceries in a month. That seems a lot to me.

 

We have a joint account with Nwide so I can't see my original intention of saying I have a lodger, or just doing it on my income working.

 

I am really struggling with this and feel very stupid, I can understand many complicated things, so why is something so straight forward so hard????

 

Any and all help appreciated.

[WelshMam2009]

Thanks for your pm IDS...I've not been around for a while...sorry!!

 

Did you look at the budget sheet I referred you to?

 

When you work out your budget you only include your priority outgoings which will exclude any credit payments whether it be to banks or your ex Father-in-Law and family!!

 

Whatever surplus is left you then divide by your creditors on a pro-rata basis to the amount outstanding.

 

Car tax and servicing you work out on an annual basis and divide by 12 along with your insurance and monthly fuel costs. You really need to follow the National Debline advice on this regarding what is considered acceptable expenditure for food and housekeeping etc.

 

You should also allow some element for emergencies and also there is nothing in there for prescriptions (free in Wales I know!! ) and dentist although I see £10 for SpecSavers which is a little confusing!!

 

What is payment to OD??

 

What about your council tax...is that included in your rent?

 

You need to check your Virgin Media payment against the standard BT monthly line rental as this is normally all you will be allowed to include.

 

Please read the National Debtline guidance I referred you to as this is all explained in great detail in there.

 

Best of luck!!

[indebtstudent]

Yeah I looked at the budget sheet, but I found it too vague, other ones I've looked at break things down much more.

 

I was concerned that if I include payments to friends and family the banks will think I'm making it up or argue tha I should be paying them less.

 

£10 to specsavers is for my contact lenses, I also obviously need eye tests and glasses now and again.

 

How much is reasonbale to allow for prescriptions (I have asthma so have three types of inhalers, one of which I use all the time other less often).

 

I pay £30 a month to my OD because the interest was £25, now it comes out about £20/month. If I don't in a month or two I would exceed the OD.

 

Council tax is about £67/month.

 

With Virgin I have my phone, tv and broadband, for which I think £34.50 is quite cheap!

 

If I speak to national debtline will they be able to advise me on this?

 

I don't know why I find this so difficult

[WelshMam2009]

Yes, National Debtline will be able to help with you with your budget sheet. You may need to be patient when trying to get through.

 

Prescriptions...whatever it costs really. You'll just have to do a best guesstimate as to how many inhalers you use a year.

 

I'm honestly not too sure what to advise as regards the loans to family and you will probably be best asking National Debtline. They tend not to like the issue of not paying your debts due to an invalid CCA so I wouldn't raise that with them. Did you send off for yours at all??

 

Best of luck!!

[indebtstudent]

to be honest the advice was pretty genric, least I've got CCCS left to try.

 

I'm sending the CCA's, TBH whatever the legailty it feels somehow like cheating. I borrowed the money and I want to pay it back, I object to the punitive interest though.

 

Good news on the SOA, it doesn't seem to matter whether I include my partner or not the money for debts seems to come out about the same.

 

Given that my goal is to stop (or minimize) interest the plan is thus

 

Write to creditors myself.

 

If this fails go for DMP.

 

If they still won't play ball go for a formal solution, or ignore them until they sell to DCA.

 

I only have a joint account with one bank therefore to the others I can just base it on my income.

 

I have thought long and hard about the relative merits of telling the truth or lying to them. I have come to the conclusion they would screw me if they could, so its best to get my retaliation in first.

 

Thoughts?

[indebtstudent]

BTw re debts to family they said to inclue it but bear in mind that creditors will not accept you unfairly prioritising debts to family above them ie you have to treat it as you would any other debt.

[WelshMam2009]

BTw re debts to family they said to inclue it but bear in mind that creditors will not accept you unfairly prioritising debts to family above them ie you have to treat it as you would any other debt.

 

Yep, that's what I said. You cannot include payments to them in your priority budget. You include them as a creditor and pro-rata payments accordingly.

 

When you work out your budget you only include your priority outgoings which will exclude any credit payments whether it be to banks or your ex Father-in-Law and family!!

[indebtstudent]

Ok so I've sent an income and expenditure sheet to HSBC and MBNA credit cards. Both have cancelled the cards (no great los since they're maxed out), but heard nothing else from HSBC.

 

MBNA sent two letters, one to tell me they had cancelled the card and to ring if I had any concerns as to why they had done this (pretty bleedin' obvious I would say). The second letter thanks me for sending an income and expenditure sheet and gives a freephone number to ring to discuss it.

 

I presume such a 'discussion' would be for thier benefit not mine. What is best to do? All the advice says to keep it in writing so I was thinking of writing back thanking them for the offer to discuss it over the phone but pointing out that I need to keep written records in case a charitable organisation later ends up acting on my behalf.

 

Now with regards to the banks I have overdrafts with I haven't written to them yet. I am concerned if I do so they will continue adding charges and interest and I'll be in an even worse positoin. At the moment I am paying a large amount of interest but no charges.

 

The credit cards I am not so worried about because I can claim any charges back without any hassle and if they take me to court I will be able to show that I have been reasonable.

[indebtstudent]

HSBC have sent a letter saying that they cannot act on the contents of the letter because the letter was not signed. I know they have to be careful because of data protection but they know I'm behind on payments, they know I paid £1 this month.

 

The letter is sent from the address they send statements to. In case there's any foul play I've decided to send off a CCA request and wait for the response to that before I send back the specimin signiture. Oh I forgot to mention I enclosed a cheque for the £1 payment last month WITH the income an expenditure sheet and the letter. As well as the card cut into peices as they asked.

 

How could I do all this if I wasn't the account holder. When dealing with creditors is it best to tell them straight if they are difficult. We know the options are they agree an informal arrangement with me, they agree a formal arrangement with me or we go to court and the court does the second option anyway.

[indebtstudent]

Spoke to National Debtline today who are sending out a DMP pack. They said it would take over ten years to pay back the money at the level I can currently afford. However the whole point of the exercise is to see if they will listen to Payplan (who I will be referred to) as they wouldn't listen to me.

 

If this fails to stop the interest I can see no sensible alternative to an IVA. I want to pay this back, but I need them to help me in order that I can help them.

 

I am concerned also that the impact of the DMP would be to leave the defaults they are in the process of serving on my credit file for longer, yet it just seems wrong to me that I can obtain a better outcome by NOT paying the whole balance (presuming the IVA was accepted)...

 

Ps got signed agreement from HSBC which looks fine to me, but see seperate thread for the Halifax reply which confuses me somewhat.

 

http://www.consumeractiongroup.co.uk/forum/halifax-bank-bank-scotland/236740-new-cca-related.html

Edited December 5, 2009 by indebtstudent

[indebtstudent]

Waiting for payplan to re-open (4th Jan) as this is who National Debtline have referred the DMP to. Is there any point talking to creditors on the phone?

 

Or should I just keep up the token payments and wait and see if Payplan have anymore success than I did?

[blueda]

Waiting for payplan to re-open (4th Jan) as this is who National Debtline have referred the DMP to. Is there any point talking to creditors on the phone?

 

Or should I just keep up the token payments and wait and see if Payplan have anymore success than I did?

Dont talk to creditors on the phone, remember the representatives that take the phone calls are paid by the creditors and not you and it is there job to get as much money out of you as they can regardles of whether or not you can afford to pay other committments, so keep all correspondance in writing and in your file and retain photocopys of your letters to them, and wait till the 4th jan and take it up with payplan.

[Mydogsawestie]

Hi I'm with Payplan they were great at handling everything and no sooner did they take hold of everything the interest stopped being added to my credit cards (Apr2008). I had tried initially to do this myself with all the creditors but kept hitting brick walls. MBNA & I believe HSBC are awkward in accepting DMP payments but you can only pay what you can afford so thats all there is to it & they like it or lump it.

 

You are not alone having found this website & will continue to gain lots of help & advice along the way whenever you need it. Good luck.

[indebtstudent]

Thanks for the replies, this is exactly what I have found. Essentially I've wasted three years paying the minimum payments.

 

I've showed them my circumstances and alll they say is telephone us. Not really fair when all debt charities advise against this. Lets hope somebody in authority actually does something about this.

 

I feel like they aren't even helping themselves, its either a DMP, IVA or Bankruptcy. The latter two are much worse for them so WHY are they being like this?

 

I intend to pay them, I want to pay them, and I know they are entitled to charge the interest. It seems they would rather do that than have the capital repaid. Strange business model.

 

BTW will a DMP affect my ability to rent? Estate agents seem to want a lot more info these days. And if it does where exatly are you supposed to live?

[Mydogsawestie]

BTW will a DMP affect my ability to rent? Estate agents seem to want a lot more info these days. And if it does where exatly are you supposed to live?

 

I wouldnt have thought so they would just want proof of your income in order that you are able to rent along with references. Its only financial institutions & applying for credit situations that would run checks for defaults etc I would imagine.

[blueda]

Being in a debt management plan is better position than all the others as it shows that you are taking action towards paying off the debt, i never found being in debt management used against me.

[indebtstudent]

"I wouldnt have thought so they would just want proof of your income in order that you are able to rent along with references. Its only financial institutions & applying for credit situations that would run checks for defaults etc I would imagine."

 

That's what I thought, but its all changed since I rented through a letting agent. Not only do most of them want a fee of around £200 just for the application it makes reference to a credit check. I am not comfortable parting with such money unless I know exactly what the criteria is.

 

There seems to be some confusion because to me a credit check means just that, especially since some of them refer to the for example Experian. I've had a look on the renting board but can't find any threads with people in my situation.

 

Still my fiancees, mothers, partner (still following? lol), has said he would be a guarantor so that should help

[Mydogsawestie]

A friend of mine who was unemployed was moving areas so had to rent somewhere, her initial 6mths (because she was unemployed) was required up front which she managed out of her redundancy money, she had no credit checks done or had to show any financial bank accts etc - glad you have the guarantors as if that info is required anything like that will help you too

[blueda]

In my experience years ago my credit rating was very bad, then during the years when the creditors were being payed through debt management my credit rating slowly improved.

[indebtstudent]

Spoke to Payplan today (eventually, kept missing each other but got an early finish at work), it was interesting. Firstly they came up with a different figures showing less available income. Also they seemed to be pushing an IVA as a better option, do they make money from these?

 

To be honest the DMP would take so long an IVA would probably be a better option. Hmm now I'm all confused. Think I'll stick to my original plan which is see how creditors react to the DMP, if they is on the whole not successful will go for an IVA.

 

If they reject that not sure what to do.

[WelshMam2009]

Spoke to Payplan today (eventually, kept missing each other but got an early finish at work), it was interesting. Firstly they came up with a different figures showing less available income. Also they seemed to be pushing an IVA as a better option, do they make money from these?

 

To be honest the DMP would take so long an IVA would probably be a better option. Hmm now I'm all confused. Think I'll stick to my original plan which is see how creditors react to the DMP, if they is on the whole not successful will go for an IVA.

 

If they reject that not sure what to do.

 

With an IVA you have to pay a fee for this to be administered by an Insolvency Practioner so your creditors end up with less and the IP earns a generous fee.

 

I suspect PayPlan earn commission for the IP referral whereas the DMP seems to be admistered free of charge as far as I can tell from their website.

 

Personally, I don't like IVA's but you have to make up your own mind based upon your individual financial circumstances.

[indebtstudent]

I do not want an IVA, but looking at the amount of the debt, and reading the info on bankruptcy it seems the least worst option for me. With bankruptcy I would have the worry of losing my car. The Parker Guide lists the car private good price as £2475 approx, so it is over the £2000 threshold they would look at.

 

If I could get an IVA accepted paying £200 per month that would come to £12000 so obviously this would be a better outcome for my since my debts to banks total around £20000.

[boswell]

Hi IDS, just read through all the posts in your thread and considering all open options i would suggest (humbly) that a DMP is your obvious choice, but here is a link that may help you in your decision, but i think you already know what you want.

 

 

IVAs

 

plus another link about ppl who have been in a similar situation as yourself, hope this helps

 

moneysupermarket.com community - iva or dmp

 

and good luck whichever way you choose.

 

B

Edited January 8, 2010 by boswell
Faulty Link

[indebtstudent]

I AM in the process of setting up a debt management plan, however I am (not surprisingly) underwhelmed by the approach taken by the lenders I have contacted. They all just say phone us, which I know is a big no no from here and every debt charity going.

 

I would particuarly welcome links to IVA & DMP stories. I've been doing a lot of searching for these but almost all seem to be people who have kids and/or a mortgage. I have none of the above, and am not likely to be in a position to even think about buying a house for the forseeable future which is why I am thinking of an IVA.

 

Is it possible to shop around for an IVA? Because obviously say £5000 in fees is a lot, and I was thinking with most financial thing they have to give you a breakdown of the costs before you commit...

[boswell]

Have you tried your local CAB for advice on this issue?

 

B.