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Over 6 years of paying off debt, what happens next?


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I am dealing with debts as listed below and I just cannot keep up with the payments anymore.

It is swallowed in interests and it’s been like that for about 2 years now!!!

 

I am paying back a total of about £620 on interests alone.

It got worse this month as my wife completed her contract job and I could not make the payments for both Halifax credit card and the AA card services.

 

I need help and advice on what to do and how to go about it.

I do not want to avoid paying what I owe but at this rate I will never be able to clear the debts.

 

The main ones are The AA, Halifax Credit card, Barclaycard and HSBC credit card, they account for about £550 in interests alone.

 

I have not made any move at all. I need advice before I do anything that may end up being the wrong thing to do, thanks for your anticipated help.

 

  1. Barclaycard – £12k (18.9% - £195 a month)
  2. Halifax Credit card - £8k (25.95% - about £150 a month!)
  3. AA Card services - £7k (26.93% - about £140 a month!)
  4. Halifax overdraft - £7.5k (about £62 a month)
  5. HSBC credit card – £3.5k (23.9% - about £70 a month)
  6. Halifax personal loan - £8.5k (8.5% - £176 (both capital and interest) a month)

 

Can someone please help, need to do something as quickly as possible. I don't want to make the wrong move, any advice appreciated.

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The help provided depends on what you wish to achieve, if it is to freeze interest then simply contact the original creditors and explain the situation.Have you completes an IE and sheet? to see what disposable income you have at the end of the month - if not do this then work out what you can realistically afford to pay your creditors and offer that payment on condition that interest and charges are frozenAlso do any of these products have PPi?

PGH7447

 

 

Getting There Slowly

---------

 

Advice is given freely but is in no way meant to be taken as Gospel:-)

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http://www.consumeractiongroup.co.uk/forum/content.php?590-Creditors-and-DCAs-Letter-Templates-Budget-Planner

 

http://www.nationaldebtline.co.uk/england_wales/budget_sheet.php?country=england_wales

 

Use one of the above budget I&E forms, see what you have to play with at the end of each month.

 

Clearly you cannot continue with the current repayments so I wouldn't even begin to try too.

 

All you can realistically do is write, DON'T phone, to all of the creditors explain your circumstances and make them a revised offer of payment, however this MUST be YOUR offer, NOT theirs, and it MUST be realistic and affordable, it may also help your position if you send them a copy of your I&E form, be aware that they have no legal requirement to have sight of such a document, but it may help your position.

 

I strongly doubt shallowfax will agree to your offer, but it matters not, you do not have to get any of them to agree to your offer of payment, you are the one who holds the purse strings and you are the one who is in control, it is no longer the financial industry!

We all bailed them out, so keep that in mind!

 

Is the loan unsecured?

 

ALL of the debts are classed as Non-priority, so they in effect are at the very bottom of the pile of things that MUST be paid. Your priority debts are your rent/mortgage, utility bills, court fines, council tax etc etc.

 

So if all you can afford to pay is £1 a month to all of your creditors, then so be it.

 

Expect your credit file to be wiped out for the next six years, but if it is of little or no importance to you then don't worry.

Who ever heard of someone getting a job at the Jobcentre? The unemployed are sent there as penance for their sins, not to help them find work!

 

 

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Thanks a lot for your advice, very much appreciated, I will start immediately with the I E form and write them as suggested.

I will feed you back with the response I get.

All the debts are unsecured an no PPI involved.

Once again thanks a lot.

 

Yes, what I intend to achieve is freeze interest, thanks for your advice.

I will contact the creditors in writing with the IE form ASAP and offer what I can afford on condition that interest is frozen.

 

I just got a call from Barclaycard, they initially increased the interest rate to 18.9% after I missed a payment about 2 months ago. I was on an interest rate of 6.9% before then. They have accepted to revert back to 6.9% for the life of the payment after reviewing my case. I will proceed with the remaining creditors.

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Thats a good start, BUT, you may need them to freeze all interest as you will be paying them a lesser amount than what they want.

 

Don't worry about it for now, but get those letters off, if there is anything on your I&E forms that you don't want them to see then you DO NOT have to include it, don't forget this is your personal and private info here, and none of these clowns have any legal right to even request this info least of all view it, you are simply providing them with figures showing what you have coming in and what you have going out and what, if any, disposable income you have remaining to pay all of your creditors.

 

Don't forget you have to have a life, so make sure you allow for nights out/in holidays, cinema, hair cuts, new car, motorbike, flat screen TV, computer games etc etc etc.

 

Have a look through these letter templates and see if their are any relevant to your situation.

http://www.consumeractiongroup.co.uk/forum/content.php?546-bank-charges-templates-%28consumer%29

Who ever heard of someone getting a job at the Jobcentre? The unemployed are sent there as penance for their sins, not to help them find work!

 

 

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Thanks a lot for your help. I was just about sending off the letters and it occurred to me that may be I should open a bank account with another bank without affiliations to any of my creditors as I have read before that they can actually withdraw money from your account to pay the credit card if they so wish to do so. My last statement from Halifax Credit card says something like that as well.

 

Any advice welcome and thanks for your help.

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Yes open up a basic bank account elsewhere, so you can be more in control.

 

If you have a credit card bill and an account with the same company, the terms may allow them to offset.

We could do with some help from you.

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Thanks, I will get that done ASAP.

Do you have a link for banks and associated companies so that I don't open with a bank that is linked to any of my creditors.

Thanks for your help.

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Post office or Co-op current accounts are easy to open.

Ash.

 

If you think I have helped you, please add to my reputation by clicking the star button to the left.

Thankyou.

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I don't believe the either the Coop or Post Office bankers have any affiliations with other financial companies that would allow any offsetting to be done.

 

I think it is only where you have a Barclaycard debt and Barclays account or a NatWest credit card debt and a NatWest account for example where they can offset debts. It has to be with the same Banking organisation.

We could do with some help from you.

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Thanks a lot. Will try Co-op.

 

Just got a call from Halifax Credit card, I picked it unfortunately and they have told me to send them an income and expenditure form after I told them I could not afford to meet repayments at the moment. I am thinking of sending a letter with the template below, can you please let me know if it is OK? Thanks for your help.

 

1 High Street,

Newtown,

Kent

R21 4RH

 

June 28, 2006

 

The Loan Company

Company House,

Church Street,

Newtown,

Kent,

R1 7HG

 

Dear Sir/Madam

 

Re Account No/Reference No:− 4563210025897412

 

This is to inform you that my financial situation has suffered adversely and I cannot now afford to agreed monthly payments because ... [my paragraph

 

added here]

 

I enclose a Personal Budget sheet which shows my total income from all sources, and my outgoings. As you can see I have only £?? per month left for

 

my creditors. The offers I have made to my creditors have worked out on a pro−rata basis, and I have written to all my creditors asking them to accept

 

reduced payments.

 

In view of my circumstance, please would you agree to accept a reduced offer of £?? per month. If interest or other charges are being added to the

 

account I would be grateful if you would freeze these so that all payments made will reduce what I owe you.

 

Should my circumstance improve I will contact you again.

 

I would be grateful if you would send a paying−in book to make it easier to pay you. Thank you for your assistance. I look forward to hearing from you as

 

soon as possible.

 

Yours faithfully

??????????????

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Yes that sounds ok. They will write back and ask for more details if necessary.

 

If you own any property with equity, they may look at that. i.e. go for a charging order.

We could do with some help from you.

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I am extremely grateful for the help I am getting here, thanks a lot.

The property is in joint name for me and my wife but the credit card is in my name alone.

If you will also excuse my naivety, what's a charging order and how does it work?

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If you own any assets in full or part then they can be targeted by creditors. A charging order would enable the creditors to be paid the amount owed when you sold the house.

 

BUT they would have to obtain a CCJ first and then you would have to fail in making the payments.

 

This is from the National Debtline. http://www.nationaldebtline.co.uk/england_wales/factsheet.php?page=15_charging_orders_in_the_county_court

 

I only raise the issue of charging orders, as I think given the level of the amounts you owe, you really need to get some proper advice from a qualified debt advisor. I would suggest that you do this asap, so you understand what the options are.

We could do with some help from you.

PLEASE HELP US TO KEEP THIS SITE RUNNING EVERY POUND DONATED WILL HELP US TO KEEP HELPING OTHERS

 

 Have we helped you ...?         Please Donate button to the Consumer Action Group

 

If you want advice on your thread please PM me a link to your thread

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Thanks a lot for the advice, I will wait to see how things go with regards to what I offer to pay them and see their response.

I will update the forum ASAP.

Thanks a lot for your help.

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You're doing all the right things so far Tunde and you should be applauded for that. It won't be easy because these people are all fine and dandy when you are paying them (especially at the interest rates you were being charged) but turn very nasty, very quickly, when you reach the stage you are now at. But fear not, your situation is probably not as bad as you think it is. Can I ask, is your wife is aware of the circumstances? because if she isn't, then you should make her aware no matter how difficult that will be.

 

Don't worry about charging orders. This is something that these people threaten, essentially to scare you into paying you more than you can afford. Have a read of this and it will make things clearer: http://forums.moneysavingexpert.com/showthread.php?t=1839539

 

You will almost certainly find that some of your creditors will be difficult to deal with - I'm thinking of the Halifax in particular. Once things have settled down though, there are further steps that will help you take control if they start to get funny with you.

 

Just remember the golden rule - NEVER talk to these people on the 'phone, insist on everything being in writing.

 

Regards.

 

Fred

Before you criticise another man you should first walk a mile in his shoes. Then, when you criticise him, you'll be a mile away and he won't have any shoes on.

 

Don't get me confused with somebody knowledgeable by all those green blobs. I got most of them by making people laugh.

 

I am not European, I am English.

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Another piece of advice Yunde is to listen to what these guys say because they really can help you. All that is needed on your part is to keep your thread up to date and the guys and gals here will get you through this. Good luck.Steve

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Thanks so much, I am opening a basic account first and letters to creditors after that in case they want to forcefully take money out of my account. I am very grateful for the advice.

 

My wife knows about this and the steps I am taking. The only linked account with her is the mortgage and we are up to date with that and never defaulted.

 

Thanks so much.

 

Regards,

 

Tunde

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The mortgage is a priority, so well done for keeping on top of that, everything else comes second, and any non priority debts such as unsecured loans cc's etc come below that.

 

If you are worried that the bank might take out money, then you can send them a letter which gives you the right of appropriation and informs them that the money is already spoken for and they are not to touch it, If you do need it then shout and I'll get a link for you, it is in the letter templates section under banks.

Who ever heard of someone getting a job at the Jobcentre? The unemployed are sent there as penance for their sins, not to help them find work!

 

 

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Thanks a lot, I will need the link as Halifax already warned in their last statement that they can take money from my account to pay for the credit card if they choose to do so. Thanks for your help.

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Here is the link http://www.consumeractiongroup.co.uk/forum/content.php?578-Right-of-Appropriation-Stop-the-bank-from-taking-your-money

 

You really MUST open another bank account with a separate banking group to stop shallowfax from plundering your money.

 

Try the Co-op.

Who ever heard of someone getting a job at the Jobcentre? The unemployed are sent there as penance for their sins, not to help them find work!

 

 

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Hi Tunde - you must follow Boo's advice and open another bank account NOW that is not associated with any of your credit cards or loans because Halifax WILL take money from your account if you don't.

:lol:

Successfully claimed back mis-sold PPI (Barclays Bank) 2009-10 (£8500)

Ran a paid-for DMP. Deeply respect those who self-manage a DMP; it is possible to do with the help of fellow CAGGERS

Offered F&F to all my creditors. All closed out including a particularly intransigent and stubborn one - who eventually saw sense after 10 months of nonsense!

Does not condone debt avoidance but violently disagrees with the antics of debt collectors and their behavior towards the ones trying to pay. I am a great believer in what goes around, comes around. Keep up the good fight!

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Thanks a lot, will visit the Co-op tomorrow.

 

Found this link that list all banks and associated credit cards and finance institutions in case anyone needs it. http://www.lendingstandardsboard.org.uk/subscriberlist.php

 

Called Co-op but declined apparently due to credit rating. I am not sure the person on the phone understood what I meant by a basic account. I will try and visit their nearest branch tomorrow.

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