Too much debt to handle...what's next??

[Big Shoooz]

Thanks Brig, I thought one of those trolls had hijacked my thread!! Seriuosly though, there is NO need for people to be like that as we are only lost souls looking for help!

[sillygirl1]

A lot of the 'challenging t&c's' and if they are wrong your debt does not exist was tried in court by the Rankines and failed miserably, these were the couple who set up a multitude of 'claims management' companies to help people get out of their debt, they also tried to set up a company where you could 'sell' them your debts and therefore become debt free -something which is already not allowed by law (I think it is in the 1925 Property act).

 

A lot of this has already been disproved via the courts but there are always 'chancers' who think they have found a new way of milking the cash cows of this country.

[adarling2006]

Yeah the chancers are classed as DCA lol

[Big Shoooz]

Hi,

I have debts totalling over £50k through various unsecured bank loans, payday loans, catalogues and credit cards.

For several years I have been paying most of them through a DMP but since giving up work due to ill health and reducing these to token payments I am getting more and more depressed that there is no end in sight. If I continue to pay each creditor at £1 per month (which is now impossible to continue with since I am on benefits and the cost of living is increasing beyond my incomings), then it will take me over 300 years to clear my debts!!

 

 

Some of the later creditors which are not in my DMP have never accepted token payments so they have been receiving nothing from me for the best part of 2 years.

I know I can't continue like this and I would love to go bankrupt (I'm not too bothered about the stigma and my credit file is wrecked enough already). I am in a good position as I do not have any major assets as I do not own my home and the most valuable thing I have is my car which is 8 years old and probably worth no more than £3k. I have no savings. Could they take my car off me?

 

Obviously I can't afford the BR fees so would hope that one of my creditors would petition for my BR but I've heard that many aren't keen on doing this these days...is that true?

 

I also wonder, since I have so many creditors, who could be the first to petition and would they go straight to this route or the CCj route first?

A CCJ would result in me making token payments but as I said before, I can no longer afford this so how would I go about it.

 

Also, would I have to sit back and wait for each creditor to bring a CCJ or would they all happen at once?

Sorry for all the questions but I just want to know what scenarios I may now be faced with since stopping all payments. I haven't paid anything for 2 months.

Edited January 29, 2013 by citizenB

[citizenB]

If you have no assets then it would seem as though BR could be a good route. I think the value of a vehicle needs to be around £1,000 - but you would need to speak to someone like National Debtline for some more experienced advice.

 

If you could answer the questions below - you might find that you could reduce some of the balances to make them more manageable.

 

Are you in reduced payment arrangements with the companies ?

 

Are they still adding interest and charges to the accounts ?

 

If they are adding default charges, then you can reclaim these (if they are credit cards/loans)

 

If you have any current account overdraft then it might be more difficult to reclaim default charges although if you could make a good argument for financial hardship they might relent.

 

Do you know if there is any Payment Protection Insurance on any of these accounts - there wont be on the PDLs but there might on credit cards / loans.

 

How old are these debts ?

[Crocdoc]

Thge upper value of a vehicle in England and Wales is £1000,00 and £3000,00 in Scotland.

[Big Shoooz]

Thanks for your response CitizenB

In answer to your questions:-

 

Are you in reduced payment arrangements with the companies ?

Yes some of them

Are they still adding interest and charges to the accounts ?

Only the ones who haven't accepted token payments

 

Do you know if there is any Payment Protection Insurance on any of these accounts - there wont be on the PDLs but there might on credit cards / loans.

No there isn't on credit cards but not sure about the bank loan....it was started in the 1990's and kept being added to so maybe the early days included it but I seem to think the later days I declined it

 

How old are these debts ?

Anything from 1990's to 2 years ago

 

With regards to the car, I do need a car so I can't be left without one. Surely, if I was told to sell my car for a cheaper one it's not going to make much financial difference because for one I would need approx £1k to buy another car before my current car was taken away and then there is all the financial hassle of re-insuring, re-taxing, etc and as it is now my current car is pretty maintenance free...if I got a cheaper (therefore older) car, it would likely cost more for upkeep, breakdowns, etc?

[Big Shoooz]

Thge upper value of a vehicle in England and Wales is £1000,00 and £3000,00 in Scotland.

 

Where do they take the value of the vehicle from? Do they use a particular website to find out the value? I'd like to know so that I can double check the value of mine as it may not be worth as much as I think.

[dx100uk]

might be an idea to list your debts

and who now owns them.

 

as a good overall guide

 

getting your CRA file is also a must

 

dx

[citizenB]

I think the first step would be to obtain as much information as you can from all of your creditors.

 

You can make a CCA request from all orignal creditors - this would let you see if the agreements were properly constructed in accordance with the Credit Consumer Act 1974. Each request would cost you £1.00 - statutory fee. The company has 12 working days + 2 to provide you with :-

 

A copy or truthful reconstruction of the agreement.

Statement of account

Terms and conditions from both inception and current or at default

 

If and when you can afford it, you could also make a Subject Access Request from all your creditors - this would give you access to ALL data in respect of your financial relationship - you would be looking for statements, a communication log - which would further identify if you have been sent Notices of Assignment, Default Notices - whether they have been sending the required notifications of default sums, etc.. what other actions have been taken on your accounts and whether they were again, in accordance with the CCA1974. This will cost you £10.00 statutory fee - and the company has 40 calendar days to comply with your request. If there is any PPI on any of the loans then you would be able to identify this from either the agreement (CCA request) or from statements.

 

You would need to make the separate requests as they are under no obligation to provide you with a copy of the agreement / terms and conditions by way of the SAR as the agreement itself is covered by a different act. Bizarre I know, but that is how it is.

 

Obtaining a copy of your credit reference files will identify the current owner of the debt (if it has been assigned from the Original creditor) - outstanding balances and default dates.

[citizenB]

I see you have some catalogue debts - it is my understanding that there is unlikely to be agreements for those - however, there could well be some form of insurance as they were keen to promote product protection which was totally unneccessary as most items would have been either covered by your home insurance or by way of manufacturers guarantees.

[Big Shoooz]

I have already done some CCA/SAR's on some creditors and I can keep going with the rest but I'm more interested in knowing the next step to me no longer making payments. What could be on the horizon for me?

I have to tell you that my biggest debt is to Natwest Bank for a loan and overdraft which currently stands at approx £25k. Even though, until the last 2 months this has been receiving token payments through my DMP it now seems to have been handed to Capquest. I think any court action could come from them first.

[Crocdoc]

Thge upper value of a vehicle in England and Wales is £1000,00 and £3000,00 in Scotland.

 

In Scotland the value is taken fro Glasses Guide, I would assume the same applies in England and Wales.

[Big Shoooz]

In Scotland the value is taken fro Glasses Guide, I would assume the same applies in England and Wales.

 

Thanks Crocdoc, just done a check on Glasses and it's come up as follows:-

 

Dealer = £1650 to £3610

Private = £1595 to £2500

Trade In = £1095 to £1630

[citizenB]

I have already done some CCA/SAR's on some creditors and I can keep going with the rest but I'm more interested in knowing the next step to me no longer making payments. What could be on the horizon for me?

I have to tell you that my biggest debt is to Natwest Bank for a loan and overdraft which currently stands at approx £25k. Even though, until the last 2 months this has been receiving token payments through my DMP it now seems to have been handed to Capquest. I think any court action could come from them first.

 

 

Righto, so you have been making token payments to the Original creditor - was this under written/verbal agreement with them ?

 

If so, then CapQuest are obliged to continue with that arrangement. Have a read of the following article.

 

 

http://www.consumeractiongroup.co.uk/forum/content.php?840-Stop-your-bank-or-lender-breaching-their-instalment-agreement

[dx100uk]

might be beeter as you have said some you have sar/cca for

 

is to start a new thread for each debt in the forum of the named OC

 

that way things will be clearer to all

 

dx

[Big Shoooz]

might be beeter as you have said some you have sar/cca for

 

is to start a new thread for each debt in the forum of the named OC

 

that way things will be clearer to all

 

dx

 

Hi Dx100uk,

that's fine but will take me some time to do but in the meantime I would still like to know what could be looming from my creditors since I am no longer making payments.

[dx100uk]

a few threat o grams

 

and poss late/over markers on your cra file.

 

dx

[citizenB]

Hi Dx100uk,

that's fine but will take me some time to do but in the meantime I would still like to know what could be looming from my creditors since I am no longer making payments.

 

Believe it or not, it depends on the creditor.

 

Some will start to write you letters, depending on the creditor / dca will depend on the type of letterf rom a mild - we have not received your recent payment to the more threatening "We have the power and authority" to make your life as miserable as we can including selling your first born !!

 

Some will busily start preparing to sell off / assign your debt which will then put you in touch with the seedier side of Debt collecting - these will say hello, we will be sending the boys round - which they have no power or authority to do. You will need to read the OFT debt collection guide lines to understand that there is a great deal of protection in place for the consumer - sadly the DCAs have a way with words that can scare the strongest of us.

 

What they should do,is first to enquire if there is a problem - then send you a Default Notice, then send you a formal demand/final warning - then if you either dont respond or pay up. They may well consider selling off or taking their own action. Most of the Creditors now consider assigning in that it apparently keeps them removed from the way in which DCAs work. After all the Big Banks have had their reputations well and truly mashed over the last few years and they are trying to regain some respect.

 

I truly suggest you pop the name of the creditor / DCA into CAG search engine and see what pops up !!

 

If you are considering stopping payments - then at the very least you should have some idea of the position you are in - if an s78 request has not been complied with (CCA request) then although it is not a good enough reason to stop payment - the account is in dispute. If the creditor is refusing to accept token payments yet continuing to add interest and default charges, then it is obvious there is little point in paying token payments only to see the debt increase !!

 

Please do a little research and ask questions if you are unsure of any actions you take.

[Big Shoooz]

I seem to already be in the process of the DCA merry-go-round but just wonder for how much longer it could go on without further action. Surely, one day, one of them will get fed up and slap on a CCJ or a petition for my bankruptcy?

Will they only petition for BR if they have done a CCJ first?

[citizenB]

I seem to already be in the process of the DCA merry-go-round but just wonder for how much longer it could go on without further action. Surely, one day, one of them will get fed up and slap on a CCJ or a petition for my bankruptcy?

Will they only petition for BR if they have done a CCJ first?

 

The likes of Lowell have been issuing stat demands like confetti at the moment - many of which have been set aside.

 

IMHO, it would not be in any creditor's interest to petition for BR as they will be unlikely to benefit - as you have already advised you have no assets so no home for them to threaten ! They will of course be aware that you dont own your own home by way of Land Registry checks.

 

Although most consumer debt will have triable issues - Stat demands are issued purely because of their "threat factor". People are much more likely to knee jerk into contacting a DCA if they receive one of these - although more consumers are taking advice and getting these set aside rather than rising to the bait.

 

There is also the fact that it is quicker for them to use this route. If they were to issue a claim then there is the initial 33 days (if the defendant, submits a defence). Then there is the adherence to Preaction protocol - and Court Procedure Rules - by issuing the claim it is they who have to prove their side of things. It could take anything up to a year before a hearing is in place and of course no guarantee they will win.

 

A stat demand, the burden shifts to the debtor to assert that there is reason to set aside and normal Court procedure rules dont apply - although they are expected to have followed pre action protocol prior to issuing the demand.

 

There is no longer stigma attached to BR, it can happen to anyone so unless there is a reason for not going BR such as future employment then a lot of recipients choose to fight back with surprisingly successful outcomes.

 

That is not to say that people dont lose - they do and the petitions go ahead, but these are mainly where people have their own homes or mega assets.

 

So back to your question - if you are working then they could apply for an attachment of earnings - bear in mind that they would have to issue a claim, win it and the judge agree with this.

 

If you have already been sent Default notices then check them carefully these are mandatory documents and are required to be accurate - both in the demand for money and the required time to remedy the breach. Most creditors fail on one or more of the requirements of the Default Notice.

 

If you are intending to stop payments - ensure you keep an accurate record of the last payment made. This will be the starting point for timing of statute barred debts which is 6 years from the first missed payment. As long as no further payment or acknowledgment of liability is made then SB occurs 6 years in England and 5 in Scotland.

[Big Shoooz]

Hi Citizenb, thanks very much for taking the time to give me all your useful information.

When you say

"it would not be in any creditor's interest to petition for BR as they will be unlikely to benefit - as you have already advised you have no assets so no home for them to threaten ! They will of course be aware that you dont own your own home by way of Land Registry checks."

how would they know whether or not I have any other assets such as savings that would be worth their while petitioning for my bankruptcy?

So, if my creditors go down the CCJ route and Mr Judge says I have to pay £1 per month because I'm on benefits, then I can't pay £1 per month, what happens next??

Obviously, I would be able to pay £1 per month to one creditor but the more that issue CCJ's and so the more the £1s add up, the less likely I will be able to pay.

[citizenB]

Hmm, whether or not you have savings - TBH, I am not sure how they would be able to establish that - they could of course request the Judge order you to be questioned by an officer of the court as to your income etc.

 

I would think if they saw that you had other CCJs then it might make them think twice about issuing a claim - it isnt something that I have come across on CAG to date.

 

I have seen however, other members, who like you have no assets who have either been playing letter ping pong with creditors or where the creditors have simply given up.

[Big Shoooz]

Thanks CitizenB,

I am currently "playing letter ping pong" myself but wonder how much longer it will be before one creditor decides to take further action.

So unless I miraculously find the BR fee to make myself bankrupt, it seems that I could stay on the DCA merry-go-round for some time to come does it? And then possibly have CCJ's and then after a growing collection of those I will have to stop paying them and then........???? Who knows? Could the court send the bailiffs round (not that they would find goods of any great value)?

[citizenB]

It is always difficult to predict what will happen.

 

I suspect your main problem could be with the £25,000 loan/ overdraft - I would think that lending someone that sum with no security was a bit foolish of them. I imagine that there are a lot of default charges applied and although the Supreme court ruled against the consumer - there are still plans to challenge these. Plus a few people have been successful in having them either returned or offset against their debt by way of financial hardship claims.

 

If there is PPI on that loan as well, then you might be able to reduce it considerably.

 

TBH, you could give yourself a serious headache with the "what ifs" so probably best just deal with each situation as and when it arises. Just be aware of what could happen by reading round the forums and give us a shout if they do contact you and we can deal with things at that point.