Credit Card debit out of hand

[Thunder191]

Hello

Basically I feel like my head is going to explode thinking about all this debt.

Due to lockdown then some bad luck and losing my job my credit card debt has spiralled out of control. I have about 25k worth of credit card debt, about 10k I have about 15 months left at 0% but now I am having to pay interest on the others as their 0% has come to an end over 6 different cards.

I would be grateful for any advice as I have researched CCA but the accounts are less than 5 years so I think they might have the documents.

I plan to stop making any payments apart from the 0% and explain the situation to the creditors, and let the cards go to default as I can’t afford payments as it would just be covering the interest.

From reading the forum the creditors will not default straight away as they want to charge interest and don’t want to sell there debt for cheap so do I not pay anything or make token payments of day £10 if they ask ?

Also when and if the DCA contacts me about a payment plan what do I do if they won’t accept a lower amount like £50 as the minimum payments are now at about £150 per card.

Also how do I go about offering/requesting a partial payment settlement with the creditor or the dca and is this something they do often? and what do I need to get in writing to make sure they don’t sell the remaining debt on.

sorry for the long post and questions but this is keeping me up at night and having a negative effect on my mental health but trying to find solutions not burying my head in the sand.

Many thanks

[echat11]

Hi Thunder

Welcome to LB

Try not to worry, don't think about it all the time.

First thing, put all your debts on a spreadsheet, so you can keep a track of them.

Secondly, if say any of the creditors were to take you to Court, there are CPR protocols they have to follow and the Court will only ask you to pay what you can afford, so for example if you were left with £1 at the end of the month after all the income and expenditure, that is all the Court will ask you to pay. The debts aren't priority debts.

Your questions:-

a) From reading the forum the creditors will not default straight away as they want to charge interest and don’t want to sell there debt for cheap so do I not pay anything or make token payments of day £10 if they ask ?

They normally default after 3 missed payments, so 3 months, it will be in their Terms and Conditions. There could be other factors that they consider.

b) Also when and if the DCA contacts me about a payment plan what do I do if they won’t accept a lower amount like £50 as the minimum payments are now at about £150 per card.

If you fill in an income and expenditure form, take into account the 'cost of living crisis' food, energy, etc. So you need to give yourself a buffer, so some headroom. It's pointless agreeing to a sum then defaulting on it. You can demonstrate to the Creditor (also to a Court if it ever gets that far) that you offered £XX, but the Creditor ignored your I & E form.

https://nedcab.cabmoney.org.uk/

The following is a template you can use, amend it to suit your circumstances, make sure you get Proof of Postage.

https://www.citizensadvice.org.uk/de...itor---letter/

c) Also how do I go about offering/requesting a partial payment settlement with the creditor or the dca and is this something they do often? and what do I need to get in writing to make sure they don’t sell the remaining debt on.

I would wait for them to come to you with discounts on the debt, reason being, otherwise you are sending mixed messages, i.e. you haven't got enough to pay them each month, you want to pay a lower amount, then you are talking about settling the debt etc.

[Thunder191]

Thank you so much ECHAT11 for the advice and guidance it has been reassuring and helpful, I will do ask your advice says

[Thunder191]

Hello All

Just a message to say thank you for the advice I received from my post and from other posts on the forum, my mental health is in a much better place now.

I have explained my situation to the creditors and sent them E&I form and to my surprise it has all been straight forward and they have accepted the low payments plan and most said the accounts will probably default after 3 months, As big as it is for me , I am not there first or I won’t be there last.

Some follow up questions I have is for example I am paying £33 per month off £5000 this will take something like 12 years to pay off so is that it just keep paying for that length of time ?

I seen on other post that the default clears 6 years after the last payment so in that case could I be looking at 18 years to clear the credit file ?

One of the company’s that I had to speak to on the phone that I owe £900 said they may offer me a settlement figure in a month or so , I research that I should request a full and final settlement letter and proof that they wouldn’t sell the debt on, are they are links to any example letters I can send them ?

Thank you