Advice needed with debt.

[fishtank1]

Hi,

 

Please help,I don't know where to start,this is the situation.

 

I have a lot of debt approx £60k on credit cards.I have not defaulted on any of the cards and I have no ccj's or defaults on my credit file.

I am a home-owner,I have a mortgage and a secured loan,both with GE Money for about £100k. I have not defaulted on those either.

 

I am self-employed and my business is fairly young. I do not have a regular income from it yet,it comes in fits and starts.

 

The cards are the main problem as the interest on them is crippling. I am at a point where I am not going to be able to make the payments on the cards soon, so I am trying to work out the best way forward.

I do have equity in my property, about £75-80k

 

Can anyone advise me or point me in the right direction? I have been reading up about IVA's , Debt Management Plans and so on, but I am really confused.It is made worse by the self-employment issue.

 

Any help or advise would really be appreciated, I am getting really stressed out by it all and don't know which way to turn for the best.

 

Thanks in advance.

[Nick Pearson]

Hi Fishtank

 

I'm not going to answer your question in detail but its either a DMP or IVA for you I think. Doubt debt consolidation or bankrutcy are a good option.

 

I have a question however. I see you've been a cagger for some time and made 34 posts so clearly you've been soaking up CAG information for a while and indeed posted responses to others and yet you're posting a question which shows not the first idea about how to deal with your own problem. This is not a critisism of you but I'm intrigued. Despite being on the forum for sometime you still have no idea about how to tackle your own problem? Clearly the forum must be failing in its educative role!

 

I have to confess that my instinct is that the post is a bit wiffy but perhaps I'm getting paranoid in my old age!

[fishtank1]

Hello Nick,

 

Thank you for your post on this thread. I don't know what your intention was,as your post was not constructive, so all I can do is answer your question.

 

 

I have been a member of this forum for some time. I do not however,live sleep and breathe it.

There is almost an information overload on this site and on the internet in general. My situation is not unique, but neither is it bog standard and with the added problem of self employment it is certainly not simple.

 

Maybe a "self-employed" section would be of use.

It is not that I don't have a clue how to sort my problems out, I would just like to be as informed as possible. There are not enough hours in the day,I am trying to run a business and sort this out which is not easy and whilst I do not expect it to be "easy", I could equally do without posts like yours that do not add anything for anyone who uses this site.

Regards

Fishtank

[Conniff]

Start with looking forward. The first thing to consider is your pension. As that is next to nothing, you don't want to go into retirement with a mortgage and hopefully not paying any rent either, so your house should be at the top of the list.

 

That brings us to GE Money. I would suspect that their payments are quit steep each month as they don't offer the best interest rates. If your credit file is clean, you must be able to get a better rate than the one you're paying now, have a look around and make an appointment to see an independent financial advisor (IFA) for some advice. They are free as they make there money on commission and you don't have to take any offer they may come up with, you can take it home and have a good study first.

 

S/he might even be able to come up with a plan that will move you away from GE and into the mainstream lenders which might include your credit cards so that you can pay them off.

 

I take it that as your business is, as you say, young, that you're not paying a full stamp so you keep the bills down, so your goal should be to get everything paid for by the time your 60. I don't know how old you are, but even if your only 20 and retirement seems a long way off, it isn't.

 

What you do is to divide all your debts including council tax, utilities and living costs by the amount of years between now and your 60th birthday and that will show the minimum amount you must earn.

I know I have mentioned retirement a few times, but it must be kept in mind otherwise you will have worked all you life building up a business and get no return from it.

 

Have a go at the figures before you decide to look at IVA and see if you can work something else out. An IVA is not always the best solution.

But go see that IFA for advice. If anything can be done, they will do it. A couple of years being lean now can make one hell of a difference to the rest of your life, so see what you can do without at home, reduce your broadband speed to a cheaper plan, get a freeview box if you can't do without tv, but it's worth having a go at listening to the radio, you might just find that you enjoy it and can then save a couple of hundred a year on the license.

 

If you have a family, it's worth all getting around the table and having a good chat to see what you can come up with and let them in on any fears you may have. It will take one hell of a weight off your mind.

Edited May 22, 2010 by Conniff