£28k in debt.....Need help

[NorthernBinder]

Hi,

 

Sorry, this is a repost of something I posted in the wrong forum.

 

I've been pointed to this site by a friend who suggested I look into other options of dealing with my £28k worth of debt other than just paying off the minimum each month.

 

Basically, as a result of a divorce I managed to put myself in a situation where my monthly pay-check for the past 5 years has gone towards paying off my credit cards rather than spending any money on my 2 children or recently my new arrival. I'm looking for help. I'm paying off all my debt at the moment and I will probably be able to continue doing so for a long time. But I'm unable to be able to reduce the debt I owe so each month the cash I earn drains out of my account.

 

Is there any sensible way out of this situation without damaging my credit rating? My debt is currently (roughly) as follows:

 

1. £12k Lloyds unsecured personal bank loan @ £289 / month which I've had for 4 years. 3 years still left to pay;

2. £9.5k Virgin credit card @ £202 / month which I'm basically only able to pay the interest off each month;

3. £4.3k Lloyds Bank credit card @ 88 / month which I've been paying off and adding to for about 3 years which I'm paying off at slightly over the monthly interest repayments;

4. £3.2 Egg credit card @ £77 / month which was used for cash withdrawals that I've been paying off for about 6 years;

5. £800 / month Lloyds overdraft

6. £500 / month going to the ex wife

7. £243 / month going to childcare vouchers

8. £127 / month mobile phone, gas insurance, life/car insurance

9. £250 / month food shop

10. £200 / month fuel

 

Out of a £2.1k wage packet that leaves me £150, any help gratefully received.

[Aulelia]

Hi,

 

Sorry, this is a repost of something I posted in the wrong forum.

 

I've been pointed to this site by a friend who suggested I look into other options of dealing with my £28k worth of debt other than just paying off the minimum each month.

 

Basically, as a result of a divorce I managed to put myself in a situation where my monthly pay-check for the past 5 years has gone towards paying off my credit cards rather than spending any money on my 2 children or recently my new arrival. I'm looking for help. I'm paying off all my debt at the moment and I will probably be able to continue doing so for a long time. But I'm unable to be able to reduce the debt I owe so each month the cash I earn drains out of my account.

 

Is there any sensible way out of this situation without damaging my credit rating? My debt is currently (roughly) as follows:

 

1. £12k Lloyds unsecured personal bank loan @ £289 / month which I've had for 4 years. 3 years still left to pay; (How much of the 12K do you have left to pay and what is the interest rate?)

2. £9.5k Virgin credit card @ £202 / month which I'm basically only able to pay the interest off each month; How much is the interest?

3. £4.3k Lloyds Bank credit card @ 88 / month which I've been paying off and adding to for about 3 years which I'm paying off at slightly over the monthly interest repayments;

4. £3.2 Egg credit card @ £77 / month which was used for cash withdrawals that I've been paying off for about 6 years;

5. £800 / month Lloyds overdraft

 

6. £500 / month going to the ex wife

7. £243 / month going to childcare vouchers

8. £127 / month mobile phone, gas insurance, life/car insurance

9. £250 / month food shop

10. £200 / month fuel

 

Out of a £2.1k wage packet that leaves me £150, any help gratefully received.

 

Hi Northern Binder,

 

Here's my take on options you could do. First, which one of the debts from 1-5 has the highest interest rate? Some people argue you should pay that one off first as the interest rate is higher than others.

 

What I may suggest may be controversial but I think you should cut out all unnecessary extra costs.

 

On no.8, you spent 127pounds on your mobile, car insurance and gas insurance. Is there a way you could sell your car and take public transport instead until you have cut at least half of your debt?

 

The money going towards the car and gas insurance in that case would go straight to paying off one of the top tier debts (1-5) that you mentioned. And this would also save you 200pounds a month on fuel?

 

By the way from no. 6-10, I don't count those as debts, but expenses. A debt is technically money you owe to a creditor.

 

Hope this helps!

[loobyloo85]

Hi there, have you consdiered looking into an IVA? If you have about £150 left at the end of each month, this may be an avenue worth looking into to help clear your debt once and for all x

[Brit]

If you can apply for it and your credit is good, then get an consolidation loan and put all the debt to one loan

[loobyloo85]

Hi Brit,

 

I wouldn't really suggest a consolidation loan. It is good for some people but in my personal experience, I found that this only worsened by situation.

[jamanji]

start by finding out if your credit card agreements are enforcable, be strong and fight hard

Edited March 17, 2010 by jamanji

[The Mould]

Hi,

 

Sorry, this is a repost of something I posted in the wrong forum.

 

I've been pointed to this site by a friend who suggested I look into other options of dealing with my £28k worth of debt other than just paying off the minimum each month.

 

Basically, as a result of a divorce I managed to put myself in a situation where my monthly pay-check for the past 5 years has gone towards paying off my credit cards rather than spending any money on my 2 children or recently my new arrival. I'm looking for help. I'm paying off all my debt at the moment and I will probably be able to continue doing so for a long time. But I'm unable to be able to reduce the debt I owe so each month the cash I earn drains out of my account.

 

Is there any sensible way out of this situation without damaging my credit rating? My debt is currently (roughly) as follows:

 

1. £12k Lloyds unsecured personal bank loan @ £289 / month which I've had for 4 years. 3 years still left to pay;

2. £9.5k Virgin credit card @ £202 / month which I'm basically only able to pay the interest off each month;

3. £4.3k Lloyds Bank credit card @ 88 / month which I've been paying off and adding to for about 3 years which I'm paying off at slightly over the monthly interest repayments;

4. £3.2 Egg credit card @ £77 / month which was used for cash withdrawals that I've been paying off for about 6 years;

5. £800 / month Lloyds overdraft

6. £500 / month going to the ex wife

7. £243 / month going to childcare vouchers

8. £127 / month mobile phone, gas insurance, life/car insurance

9. £250 / month food shop

10. £200 / month fuel

 

Out of a £2.1k wage packet that leaves me £150, any help gratefully received.

 

Hello there NorthernBinder,

 

Are you a homeowner?

 

All that hard work each month and only pennies left, you need to consolidate these loans into one basket, and then start to enjoy your wonderful life with your wonderful children, I am sure also that you are aware that you do need to curb some of those expenses.

 

Can you apply for a loan against your property (If you are the owner) and spread the cost of the consolidating loan over say 20yrs, if you can do this you will be paying out far less than what you are now, and being able to spend far more on your children, far more time and money:).

 

Well not much help I know, but I hope it will assist you somehow.

 

Good Luck please up-date when you can.

 

Kind Regards

 

The Mould