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| The independent answer to your debt problems | login join |
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joopjoop
| 25-10-2007 11:19 PM |
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Joined: 25 Oct 2007 Posts: 4 | I have just completed an SOA and for the first time I can see the extent of my debt problem. I feel such a fool. I have just been spending and spending, buying things I couldn't afford getting a bit of buzz then feeling worse. My situation has been made worse with my creditors calling morning noon and night. My dad has offered to help me with a loan but I don't want my parents baling me out of a problem which I have created. What should I do? |
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| helpmenow | 26-10-2007 03:03 PM |
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Joined: 15 May 2007 Posts: 30 My Profile | Welcome joopjoop It takes a lot of courage to confront your debt demons. I have had my demons to fight and I am on the road to recovery, (I have just recently signed an IVA), but the SOA will definitely help you see things more clearly. I have looked at your SOA and there seems to be a problem with the SOA. The info says you have £49,250 of debt but the SOA only details £12,500!! I don't know if anyone is sorting this out? Anyway welcome and I hope that you get the help you are looking for. A couple of questions which I think will be useful 1. Are you single? 2. Are you getting a single person discount for the Council Tax? All the best jj |
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joopjoop
| 26-10-2007 03:41 PM |
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Joined: 25 Oct 2007 Posts: 4 | Hi helpmenow Yeah I did notice the problem of the SOA not displaying the rest of my debt. Obviously the SOA is doing what I did for the past 4 years - ignoring it!! My debts are - LLoyds TSB £9552 Egg £10,700 American Ex £1,500 MBNA £10,000 Morgan Sta £5,000 Tesco's £6,000 Welcome Fin £6,500 I am single and yes I do get a council tax discount. |
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| DW George | 29-10-2007 11:27 AM |
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Joined: 01 May 2007 Posts: 148 My Profile | Hi Joopjoop Welcome to DW. I have examined your SOA and it doesn't make good reading . With nearly £50k of debt and only £260 free to reduce the debt you are in quite a serious position. Your options are 1. Debt management plan. It will take approximately 16 years to pay off your debt on your current expenditure and salary. This will require all your creditors agreeing to freeze interest on the debts to clear the debts in this time-scale. 2. IVA This requires certain criteria to be met before you can be accepted for one. Many creditors have changed their acceptance criteria and are rejecting IVA's which don't meet their minimum dividend level. An IVA lasts for normally 5 years so you must be confident that you can maintain the payments for that period. 3. Bankruptcy If you do not have any assets to protect and your career path will not be hindered by being bankrupt then this may be the best choice for you. £50k of debt is an enormous amount of unsecured debt to have. Bankruptcy will clear your debts away within a year. From looking at your SOA you can make savings but I don't think that it will make any degree on in-roads into your debt mountain. Let me know if you need more information. George |
| paladin | 29-10-2007 03:19 PM |
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Joined: 06 Jun 2007 Posts: 55 My Profile | Joopjoop Hi there. I hope that you are not too despondent about your financial situation. I have looked at your SOA and I agree with George that your solutions are very limited. If you go down the DMP way then this can be a rather torturous route. The DMP is an informal arrangement, so at any time the creditors can and do change their minds about the plans. In this particular financial climate the creditors are examining different ways they can tighten belts. If you sign up a DMP there is no guarantee that they will fix or even freeze the interest rates or even decide to allow you to continue with reduced payments. The IVA is really only useful for protecting your assets, ie your house. Committing to a 5 year payment plan when you have trouble balancing your expenditure with your income may be very difficult and may also end up in bankruptcy if you fail to maintain the payment schedule. Bankruptcy wipes the slate clean. True many people talk about the stigma of it but who really knows!! Do you know of anybody who has been made bankrupt? If you read the local press there will be a notice in it declaring who has been made bankrupt but nobody reads them. So don't worry about it. After a year your debts will be cleared and a further fives years your credit reference file will be cleared. If need any more help post back. |
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joopjoop
| 30-10-2007 10:44 AM |
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Joined: 25 Oct 2007 Posts: 4 | Thanks for your replies. The situation I have found myself is a result of two things, running up credit card debts whilst a student and not budgeting properly. I feel such a fool, I kept on telling myself that this would be last time I went out with my friends and put it on plastic or this would be the last pair of shoes I would be buy to make me feel better. I was always putting things off till tomorrow. Tomorrow has come and it doesn't look good. In respect of bankruptcy I fell that I am just walking away form my debts. I feel that I should be paying it all back. How will a DMP affect my credit rating as I want to be buying a house? I know I have nobody to blame but myself which makes me feel worse about my finances. Sorry for getting so down about my situation but I feel hopeless. Joopjoop :( |
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| helpmenow | 30-10-2007 04:37 PM |
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Joined: 15 May 2007 Posts: 30 My Profile | joopjoop Please try not to examine your problem too much. I have been through a similar situation as you and asked the same questions of myself. All that happened was that I had just had sleepless nights and bouts of deep depression. So my advice would be don't sweat the small stuff. The lenders don't have sleepless nights about your debt situation nor did they have any checks and balances in place to ensure that you could afford your debt burden. They are in business to make money from you. Bankruptcy and IVA's are within the law, so why not do what you are entitled to do and go bankrupt. Don't stress about paying back the full amount as this will just get you down and stressed. Your good health is certainly worth more than £50K. So dom't sweat it!! helpmenow |
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joopjoop
| 31-10-2007 01:43 PM |
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Joined: 25 Oct 2007 Posts: 4 | Thanks helpme for your thoughts, you made me think about what really matters. This may sound stupid but it's good to know that your not the only one. I think at the very least I should speak to someone. Can anyone recommend who's best to speak to? jj |
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| DW George | 02-11-2007 03:36 PM |
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Joined: 01 May 2007 Posts: 148 My Profile | JJ You can either contact one of our advisers or visit either your local CAB or if they are too busy try one of the companies in yellow pages. This forum is not here to promote any debt advice companies just to promote good debt advice. George |
