Money/lending advice

[Dinnerbag]

You are missing the point thought, in reality there won’t be a saving of £150 - prices are increasing, so you won’t actually have additional money to put onto the energy bills or whatever else. The money you have available still won’t stretch far enough. Unfortunately your debts are high and your income isn’t enough to pay what you owe off, it’s as simple as that.

I don’t understand? Honest I’m not been arsy or clever, but if I manage to not spend £100 a month on fuel and £50 a month on a mobile phone and use that money for the increase in energy prices and food, surely that will help?
I just keep thinking surely it’s worth been skint for 18mths and then be debt free, than pay the minimum on the cards and make the debt last longer.

 

[BettyCrockerr]

I don’t understand? Honest I’m not been arsy or clever, but if I manage to not spend £100 a month on fuel and £50 a month on a mobile phone and use that money for the increase in energy prices and food, surely that will help?
I just keep thinking surely it’s worth been skint for 18mths and then be debt free, than pay the minimum on the cards and make the debt last longer.

So the costs of fuel/food and everything is increasing, and is going up at an alarming rate. So the £150 you are going to put into that won’t end up being on top - it will just be absorbed into the rising costs. The costs are going higher and faster than we can all keep up with. It’s a bit like when the government say they are giving nurses or whoever a pay rise but in reality it ends up that they get paid less after it because of inflation.

Im genuinely not trying to piss on your chips here!

have you had a chat with Step Change? If not,give them a call today. They really are very good at offering proper advice and practical solutions - it’s not just a debt management plan thing - they have loads of ways to help you sort your debts out and future proof your finances so that you can get out of debt and move on.

 

[Dinnerbag]

So the costs of fuel/food and everything is increasing, and is going up at an alarming rate. So the £150 you are going to put into that won’t end up being on top - it will just be absorbed into the rising costs. The costs are going higher and faster than we can all keep up with. It’s a bit like when the government say they are giving nurses or whoever a pay rise but in reality it ends up that they get paid less after it because of inflation.

Im genuinely not trying to piss on your chips here!

have you had a chat with Step Change? If not,give them a call today. They really are very good at offering proper advice and practical solutions - it’s not just a debt management plan thing - they have loads of ways to help you sort your debts out and future proof your finances so that you can get out of debt and move on.

Oh no, I knew you weren’t trying to annoy me or upset me, I was just getting confused x

 

[JoeBloggs]

Oh no, I knew you weren’t trying to annoy me or upset me, I was just getting confused x

If we were in ‘normal’ times then what you are saying is right, but at the moment prices are increasing at a rate no one can keep up with. Sadly £150 won’t got anywhere right now and if anything you could end up in more debt because you have limited disposable income. Energy bills are increasing 54% in April and again on October. Council tax 4-5%, NI increases. That’s excluding petrol, food and other essentials. For example my car usually costs £60-65 to fill up from empty. It is now £80-85 and it’s only going to go up.

There is no shame in contacting someone like step change, they might be able to help write off some of your debt which will help you massively with the current climate.

 

[George Agdgdgwngo]

I agree that Step change are a good organisation to chat to. I did once and for me there were no good go my situation, so I spoke to the bank and get a loan with very low interest rates and made overpayments to get get rid of the debt. That was many many years ago, I’m now making over payments on the mortgage and only have 5 years left to go. I did some side hustling or gigging or whatever they call it. I found a second calling to make some money and I still do. I now have spare money for holidays and treats.

 

[a.pain]

Before going to step change you might actually be better off going to each lender and advising them you’re struggling with repayments, you’d be surprised how willing they are to help! That would have a much smaller impact on your credit score. A debt management plan really is hard to get a mortgage with. There are also a lot of Instagram pages about now detailing paying off debt, frugal living etc and also detailing their ‘side hustles’ such as delivery driving for just eat Uber eats etc when they have any spare time, and any money made from those going straight onto their debts.

Any company that freezes or reduces interest will usually put you onto an arrangement to pay and default your account which is what would happen on a debt management plan anyway. I’m not aware of any alternatives happy to be corrected if anyone has any personal experience?

OP- if you think you can pay off your remaining credit within the interest free period, plus keep some spare for cost of living increases- and you really need to overestimate this rather than underestimate- then go for it, but worth bearing in mind if you find out in a year you are unable to keep it up and end up going into a DMP anyway then you’ve lost valuable time. I am in a DMP through step change and currently in the process of buying a house, our mortgage with a specialist lender is about £250 a month more than if we were with a high street lender but we have only been in the DMP since summer 2019 and have just hit the time period to qualify for a mortgage (there aren’t any lenders that will currently lend to anyone with defaults less than 2 years old unless they are very small). I am glad we did it because for the last 2.5 years we have not worried about money at all because we have had someone help us with a comfortable budget. We get to redo the budget as much as we need to if anything changes, our credit is only getting better not worse and in a few years we will have paid off £65k of debt (!!) and our attitude towards credit has completely changed and honestly that is the best gift of all.

 

[BettyCrockerr]

Any company that freezes or reduces interest will usually put you onto an arrangement to pay and default your account which is what would happen on a debt management plan anyway. I’m not aware of any alternatives happy to be corrected if anyone has any personal experience?

OP- if you think you can pay off your remaining credit within the interest free period, plus keep some spare for cost of living increases- and you really need to overestimate this rather than underestimate- then go for it, but worth bearing in mind if you find out in a year you are unable to keep it up and end up going into a DMP anyway then you’ve lost valuable time. I am in a DMP through step change and currently in the process of buying a house, our mortgage with a specialist lender is about £250 a month more than if we were with a high street lender but we have only been in the DMP since summer 2019 and have just hit the time period to qualify for a mortgage (there aren’t any lenders that will currently lend to anyone with defaults less than 2 years old unless they are very small). I am glad we did it because for the last 2.5 years we have not worried about money at all because we have had someone help us with a comfortable budget. We get to redo the budget as much as we need to if anything changes, our credit is only getting better not worse and in a few years we will have paid off £65k of debt (!!) and our attitude towards credit has completely changed and honestly that is the best gift of all.

Agree with this 100%