debt problems

[mancitydreamteam]

Im in the shit. Owe approx 20k from credit cards and loan from when my mrs couldn't work through ill health. I've had to become her carer now so we're on benefits with 2 kids. I've got a mortgage but we get the interest paid but still have to find the rest on our own so we have to use her DLA money which isn't right it should be going to her needs but unfortunetly keeping a roof on our heads is a need!
The CAB said that I could sell our home and pay the house off and have about 20k spare which would be gobbled up by the debt then we'd have to go into council accomodation, uprooting kids etc so after working 20 years and paying a mortgage for 15 we'd have nothing left. If I kept the 20k and carried on using the debt management plan we're on which we pay £50 per month then the benefits would be stopped.

Don't know what to do. Can't afford an IVA and don't qualify for a DRO.
I've been told from the debt management company that we could probably settle for £13k with all the creditors but that's not going to arrive unless I win the lottery or a rich relative pops off.

We pay the debt management company £15 as part of the £50 - i'm happy to, only because they deal with any letters from the creditors and although the CAB can set up £1 payments to each creditor its got to be set up again each year while this is a rolling thing. So its that little less stress for us as a couple.
Feel like we're stuck between a rck and a hard place.

Any help or advice greatly appreciated.

You tried doing a debt reduction plan? Similar to debt management accept when you nmake a payment its put to one side until there's enough to do a full and final settlement. Basically your creditors recive pound a month payments and the rest is put to one side. Maybe worth a shot just to keep creditors off your back. give payplan a ring they will be better to give you more advise than cab. Hope you sort it out though.

 

[meldrew]

Working within debt collection I have a few words of advice.

- CAB, steer clear can take an age to resolve and many I have dealt with personally don't know arse from there elbow.
- Step Change, the best option for advice like a debt management company but no fees and do everything for you, its so simple dealing with them.
- Debt management companies, imo steer clear of them, rip off merchants and only interested in making as much money for themselves as possible.
- Keep in contact with your creditors, ideally by post and tell them that's how you want to be contacted. Tell them your proposals and tell them your struggling, they have to help.
- Don't give your any of your telephone numbers to anyone, they will find it and pester you.

Hope this helps, pm if any questions.

 

[Tipo]

I've had an IVA for nearly four years, to be honest best thing I did, don't get anyone chasing me for monies owed, I live within my means and in just over 12 months I will be debt free, only thing is that they want in the region of 22p in the pound owed, and you daren't miss a payment because you would default and potentially go bankrupt, it was tough to start with but I've never missed a payment and my IP leaves me well alone

 

[nw42]

I've had an IVA for nearly four years, to be honest best thing I did, don't get anyone chasing me for monies owed, I live within my means and in just over 12 months I will be debt free, only thing is that they want in the region of 22p in the pound owed, and you daren't miss a payment because you would default and potentially go bankrupt, it was tough to start with but I've never missed a payment and my IP leaves me well alone

Not quite as harsh as that mate, you can get up to a 6mth payment break if circumstances dictate, like pregnancy, unemployment, sickness etc, although then you would have to make good the deficit at the end with extra contributions. As for 22p in the pound, well it's really about paying what you can afford, I've known as little as 10p in the £ to be accepted by creditors because it was the best offer.

Glad it's worked for you though, it is a long slog but it works for many people who can't, or don't want to go down the bankruptcy route.

 

[The Silver Surfer]

Thanks for the advice and well wishes, ill be pming one of you soon. Cheers.

 

[Tipo]

It's a tough decision, but one you can only make knowing the facts, I was up to my neck and couldn't afford the repayments on loans, overdraft etc etc, and when I was made redundant, no chance of paying any back, so my creditors accepted minimum payments until I was back earning. Once employed on half of what I was earning, I took out an IVA, the creditors were keen to get something rather than nothing. IVA worked for me as I want to rebuild my financial rating to hopefully get a mortgage, I'm now researching how to improve your credit rating, and strangely enough I got an invitation tontakeva credit card with 30% APR, I'm sure technicallybibcannot take on any more debt, although I would pay back in full as I make it a rule, if I haven't got he cash I don't do it or buy it......still found enough cash to go and watch the blues in Dortmund though.....

 

[stonerblue]

Try the citizens advice if you have a decent one near you. Some of them have debt advisors