Debt - should I let it go to court ?

[Minelace]

I have a debt of £4k which I need to clear. The creditor wants me to pay very large monthly installments which I cannot afford. I have been very open and transparent - told them my monthly income vs expenditure and offered a payment plan I can afford, but they are insisting I pay larger installments.
If I say yes to that I know I will not be able to make the payments. The money is simply not there.

They have previously threatened court. I'm almost inclined to let it go to court, take the ccj and hope court would agree a better payment plan.

What shall I do? Would a court accept a smaller payment plan based on my realistic affordability? Or would they send bailiffs? I don't own my home, I rent. And have no savings or assets. I exist in my overdraft !

Can you speak to Stepchange? Their intervention may avoid a court case.

@LIZS no I haven't, but I will today. I'm definitely feeling mentally vulnerable about the situation and could do with some support!

A bailiff usually accepts a payment plan with a ccj..they offer this first via a letter .
Also look at charities that speak on your behalf.
They offer smaller payment plans which are accepted.

www.stepchange.org/

nationaldebtline.org/#:~:text=We%20are%20National%20Debtline%20%2D%20and,debts%20for%20over%2030%20years.

Agree - If Stepchange intervene it might help.

I wish companies weren't such bullies. I had the same problem myself. They wouldn't listen when I told them I could only afford so much and they took me to court. Court said I only had to pay £15 a month.

So yes, try Stepchange first and then let them take you to court. But make sure you've got documentary evidence that you have made them an offer so that you can show the courts you are at least trying to solve the problem.

The problem is if you go the court you won’t get credit in the future. It can cause issues when applying for jobs.

I would call stepchange and they can speak to the lender in your behalf - is it a credit card?

If they issue a claim you are sent a form where you give details of your income and expenditure and make an offer of payment. If the creditor rejects your offer then the Court will calculate what they think you can afford. If either you or the creditor are unhappy with the amount then you can have a hearing before the Judge who will make a final decision. Bailiffs are not involved unless you fail to make the payment ordered.

If you let it go to court then it might work out better, but it might not. You lose the small level of control over the situation that you currently have.
Can you cope with that or not? Take it from there.

It's not a credit card, it's actually for my childs nursery. I set up a DD a long time ago which they recently informed me had not been correctly applied and therefore no payments had been taken and presented me with that bill! I did question why they didn't let me know earlier / bill me sooner and they said they emailed once about it.
I've certainly not got any emails to that end, to which they said it could have landed in my junk.
Either way, my DD has attended the nursery and otherwise I have been very happy with their service...

I wouldn’t recommend allowing it to get to court in all honesty no. Although if it does they may then accept a smaller amount, it will have an absolutely huge impact on you for the next 6 years to have a CCJ against you. You say you rent your home, if your landlord chose to sell up next week and you have a CCJ against you then you will find it really hard to find another landlord who will rent to you. It could also impact your current job depending on the sector you work in and could stop you getting other jobs in future. It’s a nightmare.

I’d advise getting in touch with a charity like Stepchange who can help you with this. They will look at your income and your non-negotiable outgoings and they will tell you essentially what you can afford.

@Mrsttcno1 I definitely will contact StepChange.. but I already know exactly what I can afford and have proposed this and then a bit more to the creditor - and they have still rejected this. I just hope that StepChange can let the creditor be more understanding in light of my circumstances.

I would assume that, if it goes to Court, court fees are added to your bill. You really want to avoid that because they will mount up very quickly. Agree Stepchange, Citizens Advice, think there are some other charities that advise as well. Good luck OP

I did question why they didn't let me know earlier / bill me sooner and they said they emailed once about it

Was this a debt collector or the nursery? because 'oh we've tried to contact you and you didn't reply so we're escalating this' is a standard debt collector tactic. Ask when they sent it, to what address and what the title was so you can search for it. Or can they forward it again? if you really want to be PA.

How did you not notice it wasn't being debited from your account?

As this isn't the standard cc/utilities debt you do need specialist advice.

Shame they couldn't accept what you offered but an intermediary should be able to help with that. Best of luck, doubt they want to go to court.

I know you’re saying you know what you can afford @Minelace but the problem for the creditor is that lots of people will low ball them in terms of “all they can afford”, I’m not saying you are of course, but lots of people will. So it’s not going to be in their interests to simply accept what people initially offer.

The benefit of going with assistance from a charity is that you can go through your entire budget with them and they then can decide what you can afford. This is the same process that will be taken if it gets to court, the court will look at all of your income & expenditure and decide what you can afford. It gets around the people who will say they can only afford to pay £10 per month off the debt while also paying for Netflix, Spotify, takeaways etc, they would be told actually no, you can cancel xyz and pay £40 off the debt for example.

How much is the debt and how much do they want?
Months of not paying nursery would be thousands for me, are you getting 'free' hours yet?