I keep hitting brick walls trying to get out of debt...

[Optimisticbanana]

I need to get this off my chest and try and breathe cos I'm getting completely overwhelmed.

Basically over the years we've had bad luck, made bad choices and now have debts in various places that we need to pay off.

One of which is our overdraft. We changed banks, after taking advice due to huge bank charges making us go over our overdraft each month. Things are improving in lots of ways but we still have the old account open and I've been trying to pay £1-200 each month if I can.

We recently got a letter from the bank to say they wanted us to the full amount over overdraft back 4.8k by next month.

We can't do it.

We've tried to get 0% balance transfer cards but all have been declined due to DHs credit rating.

I can make an arranged payment scheme with the bank but this leaves a 6 year bad credit marker on our credit rating and we are desperately trying to get back onto the property market and get our own house again. We are trying to repair our credit rating as well as getting out of debt.

It's all such a mess!

Is there anyone who has any suggestions. I'm so worried about things I'm getting snappy with the kids and just want to run and hide.

Has anyone else been in a similar situation who has resolved things with the bank without it affecting their credit rating?

What is the interest on the 4.8k bank?

The 200 a month is it just paying off the interest or is it chipping away at the debt too?

Honestly I don't know. I'm literally just throwing money at it to try and bring it down. I really hoped that a 0% card would be the answer. At least for a bit.

It has been bringing it down, it was 5k a few months ago

You need advice from debt professionals OP. There are some specialist charities out there which help people in situations like yours - they can advise on things like an agreed repayment scheme.

I’d say you need to put the house buying plans on hold while you sort this out though. Seems a bit cart before horse I’m afraid. Sorry.

Have you contacted stepchange? They may be able to help.

I think they probably want it back due to your salaries no longer going in to it. Are you able to change that? You’d have been better off letting your income go in to it and moving over your ‘spend money ‘ for the money to another account.

Santander gave me a loan t o pay them back overdraft charges.
Abusive exh trashed my bank account and I hadn't realised. Owed £2000.

You need specialist advice. It may be that a Debt Relief Order could be a way forward.

Citizens Advice might be a good place to start.

Put the house plans on hold

Then

Be kind to yourself. Your health is more important.

This is fixable, but you are going to have to make changes to what you wanted.

Then go get some advice.

I think you might find that is your credit is bad enough that you can’t get a 0% then you are going to get shafted on a mortgage anyway, so the most cost effective thing will be to deal with this crap FIRST.

Much sympathy, we’ve been there. It is awful.

Isnt there a limit to how much they can charge? Thats ridiculous.
Id contact christians against poverty.

So sorry for your problems. Agree with PPs that you need to see a debt specialist/CAB. But use any time you can before that going through your income and expenditure with a fine tooth comb so you can talk to them about it thoroughly.. It will also help if you do need to see the bank manager for a stay of execution/discuss viable terms of repayment.

House buying isn't yet, but this year we were really trying to sort out our credit rating so house buying could happen in the future. We're in our early 40s though so don't want to wait much longer.

We've spoken to Stepchange in the past and used a lot of their advice but wanted to go it alone to avoid the bad credit rating.

It is possible that I could put my tiny salary into it.

I’d be surprised if a mortgage lender would consider you if you have a £4,800 overdraft and are struggling to pay it off. I totally agree that you need professional debt help. Try Step Change or CAB. Google your water supplier too with the words Trust Fund, so like Severn Trent Trust Fund. They will often reduce bills for families who are struggling, help you plan a budget and might even help you to get out of debt.

If you do a search on Registry Trust, yiu can find out if you already have any CCJs and have you looked at your credit score? I’d do these 2 before doing anything else. Once you’ve seen these two, you can figure out how you move forward.

Definitely talk to the bank though like others have said. They may just convert it to a loan for you

As a PP says, because your salaries are no longer going in, the bank will have flagged it as a debt that’s not being run like a regular overdraft- you’ve become a bad risk.

Step 1 talk to the bank with the OD. See if they’ll convert it to a loan. Point out you’ve been making regular payments of £200pcm and see if they can offer a loan on that per month payment. If they see all the credit card applications in your DH’s name explain that you wanted to repay the overdraft. Try to get an appointment in person.

Forget about house buying for now. Time and good management will repair your credit ratings BUT you need to be on top of everything. Get a rocket proof budget. Know all your debts and their interest rates and limits etc.

You're going to get a bad credit rating anyway so you might as welll listen to stepchange, they might be able to get the interest frozen.

Have you look at www.moneysavingexpert,com there's lots of advice over on it.

Or even www.moneysavingexpert.com

Apologies if you already know this, but you can do a soft search to see if you’re likely to qualify for a loan/credit card to clear the debt without it affecting your credit rating.

If you’re unable to borrow anything extra or don’t want to, I’d suggest contacting stepchange, their number is 0800 138 1111. They might be able to advise on other avenues, or if there’s a lot of debts they could set up a debt repayment plan to get the interest frozen or reduced.

I’m sorry you’re going through this, it’s very stressful 💐

www.stepchange.org

We were in talks recently with a mortgage broker who had said we should be able to get a mortgage, which was giving us some hope! But we knew we wanted to get things paid off.

DH has a new job and his salary has increased by 600 a month in the last few months so in some ways on paper we look good. It's just past problems are putting a spanner in the works, we just want to pay things off!!!

Thanks Nosquirrels I think what you're saying makes sense x

We've both had recent credit checks and mine is great - though my income is v low and his is bad - though he has a good income! Partly here lies the problem of getting a credit card!

Is there anyway to increase your income OP? Even if it’s just working evenings in a bar, shop and call centre in the evenings?

You need:

England: Individual Voluntary Arrangement
Scotland: Trust Deed

You can arrange one through KPMG.

You won't be bankrupt, but it will affect your credit rating for 6 years.

All of your Creditors will agree to it. After which they will not be allowed to contact you.

You will pay off approx 10p for every pound that you owe. And in 3 years you will be debt free.

(I'm an Ex debt collection officer)

I’d be very surprised if you can get a mortgage, while being declined for a credit card?

It makes no sense to me either marypoppins

As pp have said dent advice through step change or CAB. Have a look at Money Advice Service website both about debt and maximising income/minimising outgoing such as switching energy or considering a water meter.
www.moneyadviceservice.org.uk/en