A Thread about Getting into Debt.

Big Debt.

1 to 20 of 78 messages
kittenkat    pirate
01/11/2012 at 19:04

It's something I'm not proud of but it happened to us as some of you know. I used to control the finances, we were at the point where money lenders were throwing credit cards at us with enormous limits. I took them and maxed them out. Not because I am in any way materialistic, there were other reasons.

However, as any of you know who have gone down the credit route, it can eat you alive and you have no-one else to blame but yourself.

And then the shit hits the fan big time.

It is extremely depressing and stressful to get to that point; but I guess what I want to say is you must confront it. We got in touch with a charity and now repay those cards at an agreed limit, we have been for about 2/3 years. That means no credit cards, no overdraft, no money that isn't in the black. It's been shit but trust me, money isn't more important than health or sanity.

I feel I can talk about this now because we know that in a few years we will be in a good place financially, plus I've got a full time job now so in one way a cloud has been lifted.

I dunno, I just know that so many people go through financial hardship for a number of reasons and wondered if anyone wanted to talk about it.

01/11/2012 at 19:26

I have been there as well.  I am a lot better with money now and over half the bad stuff on my credit rating is Banks not updating properly but as I have been temping for years I am in and out of work and although I haven't had any new credit upsets per say I have got arrears ontop of arrear for things like council tax - the mortgage (not mine but I am responsible for it) water that takes up alot of my weekly wage at the moment but tyhe faster I shift it the sooner its over and I seem to be getting better and better at budgeting

Elderly cats isn't helping at the moment, the vet bills slow things down a bit

01/11/2012 at 21:06

Strangely enough I used to have large credit card bills until I got made redundant.  Used my redundancy money to clear the bills, set up by myself and haven't looked back and am now well on way to paying off the mortage.

02/11/2012 at 08:40

My advice would be never have a credit card. Ever. It's all fine and dandy when you know you can pay it off every month but when finances get tight it is a millstone around your neck.

And having multiple credit cards is utter madness whatever your situation.

The only reason I have one is because I can't shop on my own company's website without one - if I had the choice I wouldn't have one at all. And I pay it off at the end of every month.

seren nos    pirate
02/11/2012 at 08:51

I would think debt is similar to obesity in this counrty.............

could look it simply as people feel they are entitled to things they don't need or afford....but feel they have a right to have it..............a bit like eating food that your body doesn't need but you feel you have a right to...........

there are few in debt from things like losing their jobs, divorce or major unknown work needed on their house etc...............and these could equate to those who are obese who have genuine illness or disabilities that make it harder for them to not get obese.........

the rest of the population in debt have just been too lazy to monitor the money they spend to equal the money they have earned.

laziness and  a feeling of people that they have a rioght to things irrespective of if they can afford it  is a more modern trait..........and it seems to go in line with the populations increase in obesity as adults..

 

But like weight i think there is strong psychological links to being overweight/ underweight and being in debt in the general population........

02/11/2012 at 09:00

I know ulitimately it is our own responsibility and we could say no, but there was a time about 6/7 years ago when it was so easy to get a mortgage. I didnt have the best credit rating previously, due to being shat on from a great height by my ex, but I was turning myself around slowly by living at home and the banks came along and offered me a 125% mortgage. Happy days thinks I so I grab the lot, buy myself a little place and get started up again as I just walked away from my marriage with nothing. There was a bit of money left over so I treated myself to a few things, as you do. A few months later the bank came along and asked me if I wanted to borrow more money. Of course I ended up saying yes and life was great. But, as happens often in life things change. My job was relocated 90 miles away and the commute there and back each day was killing me after 18 months of it. So I got myself another job that meant a massive pay cut. So my story goes full circle and I end up struggling to pay my mortgage, bills, loans etc. I was balancing my payments but it mean that each month 1 or 2 creditors werent getting there money, so the arrears increased and before too long they were knocking on my door, again.  I tried the option of just ignoring them but, after the financial crisis of a few years back hit, they wanted therir money. I went through a company that consolidated my loans for an affordable monthly payment, as seen on TV !, but those bastards are as bad as they took about 35% of my monthly payment. So enough was enough and I took the problem by the scruff of the neck and dealt with it. 4 years later I am well on the way to 'recovery' and I even managed to keep my property.

I am now living with my new partner and are looking to buy our own property in a few years.  

I now have a 'cash only credit card' which is really good. You transfer however much of your money onto it and use it as a normal credit card, the only difference is that once you have spent the money you transferred on to it you cant spend anymore. It's really convenient and is also helping me improve my credit rating. I would recommend one of these to anyone (Google MasterCard CashPlus for further info).

The one piece of advice I would give anyone struggling is not to hide your head in the sand as it wont go away. Get in touch with your creditors and offer them a small monthly payment that you know you can afford but also leaves you with enough money to pay the others and also have some sort of life. In todays climate I can assure you they are happy to take anything they can get. Even though I had no intentions of doing so, I kept telling them I may be forced to go bankrupt if they didnt accept my offer. Obviously, they were then happy to accept my offer as it was better than getting nothing at all.

seren nos    pirate
02/11/2012 at 09:03

I suppose the banks could be equal to the fast food outlets ..........they are both there to tempt you......

and in both cases the majority of the people know what they are doing but give in for the quick high...rather than thinking about the future.....

glad to hear you are getting straight 

02/11/2012 at 09:07

Yep, I fell in to that trap. I'm certainly not blaming all the advertising and the banks because at the end of the day I could have said no. You certainly dont see the amount of advertising nowadays that you did back then. But, if you are that way inclined like I was back then and like a lot of people probably still are, you dont realise it's a problem until it actually becomes one. A bit like overeating and obesity like you say, how many of us started running only when we became overweight ? Why didnt we sort our finances out before we were up to our necks in it ? There are those of you who have been able to manage both your finances and your health from an early age and I wish I could have been like that

02/11/2012 at 09:52

I used to work for one of the big Banks and as a result I was entitled to all kinds of ridiculous credit - more money potentially available to me than I would ever get to pay off. I have seen the damage that it can do. My advice would be this, firstly, if you find the outgoings so high that you can't manage them and have a life then seek help. There are independent Charities that help but Citizens Advice will set you up with the sort of help you need. If it's n ot quite that bad but you want ot start making an impact on your debt then there are things you can do . i.e. if you have a Credit Card and your Credit Rating is okay then find a 0% transfer deal for x amount of months, this way you pay only the capital and not the interest. Look at other debts and see if you can consolidate them. Look at your phone/broadband and other household contracts to make sure you are not over paying. A great thing you can do if you live in a built up area is "rent out" your driveway during the week, people will pay for parking if it saves them money and it's alll above board and legal. Whatever, keep in mind, it's just Money. There really is more to life and there is always help available no matter how bad it feels.

02/11/2012 at 10:09

To be honest - i've had more issues with the government loans company (student loans) than any of my banks. When I left uni and moved abroad to find work - I was living in overdrafts and scrimping by on nearly nothing a month. I didnt have enough money for furniture or anything like that - i lived on handmedowns for a year. I could spend 10EUR a week on food. During that time Student Loans came calling and were demanding huge amounts of money (that I simply didnt have and they must of known it looking at my bank accounts). It was only due to the Citizens Advice that they got off my back and reduced down the payments.

When I spoke to my bank(s) about my situation - then they were really helpful and supportive and even now - I'm grateful for their attitude.

I have two credit cards. One for work expenses and another for 'personal'. The only reason i have a personal one is because my 'normal' bank card isnt accepted by most retailers on the internet and I never spend more than i have in my account.

I'm absolutely petrified of being in debt and living so close to the poverty line that I try to save as much as I can every month... BUT... this also has its downside. Hubby wants to  get another mortgage to fund the rebuild of the house and i'm stalling. Not just because of the amount of money but because I don't think any job is safe at the moment and I wouldn't believe that I could get another one quickly enough.

02/11/2012 at 10:33

I've got a credit card which I use to pay for things like booking tickets for group outings when I'll be collecting the money from friends at a later date. I pay it off each month.

Agree with carterusm about banks - my first job was in the sales team of a high street bank and the way that the "financial advisors" (sales) would encourage people to apply for mortgages that were beyond their means by fudging their payslips and income was disgusting. Ditto the way they would advise little old ladies with a no-risk savings account of about £5K that they should be investing in high risk stocks and shares products. That is part of the reason I left, because we were expected to meet sales targets and had pressure put on us to encourage customers to take out products they didn't want or need. We can all say that people should take more responsibility for themselves, but before the crash in 2008, many people held bank staff in very high regard and would take what they said at face value, trusting them to have some integrity.

Also agree with Emmy about Student Loans ... what I hate about them is that they are really slow to credit my repayments to my Student Loan account. They money comes off my salary every month, but it gets credited to my Student Loan balance once a year? So the money I repaid in tax year ending April this year will be credited sometime about now, doesn't seem right to me. They say they backdate the interest but I'm not sure I believe them.

It would have been really good if instead of having pointless PSE lessons in 6th form, we actually had someone to come in and talk to us about managing personal finances and the dangers of getting into debt. There were so many banks out there willing to throw £2K overdrafts and credit cards at students.

seren nos    pirate
02/11/2012 at 10:37

xine.i don't work and my husbands money is beklow the national average.......we bank with natwest.......when woolwich was taken over by barclays we had to also have a barclays current account...........the instant lending reserve with that account is over £55,000......we can just write a cheque out for that amount any day of the week without even seeing any bank staff.............that is several times our annual salary.........

but just because its there doesn't mean we have to take it.the same as the pile of biscuits on the plate or the all you can eat bufett..

problem is we all have our weaknesses.......somethings we have to work harder at saying no than others.........

 

Dave The Ex- Spartan    pirate
02/11/2012 at 10:38

No one ever forced you to spend on a credit card, or buy a big mac

02/11/2012 at 10:46

But Seren, what if you were desperate to buy a house, had made an appointment with someone you were told was a "Financial Advisor" and were told that it was absolutely fine to borrow 8 times your annual income because "everybody does it" and "your house will definitely increase in value by the time you come to sell it, so you'll be able to pay back the rest"? And then the "Financial Advisor" helped you fudge your supporting paperwork, either by telling a self-employed person to overdeclare their earnings for the 3 months they needed to provide proof of income, or by borrowing a lot of money from friends/family in the short term to show a large amount of cash coming into your bank account?

These are things that I heard Financial Advisors say to customers, and any concerns the customers had were brushed aside by someone arguably in a position of trust telling them that was the way things were done. I'm not being patronising but finances are a mystery to a lot of people, and they place a certain amount of trust in people who go by job titles like Financial Advisors to give them proper advice, not basically mis-sell products because they want the commission.

Dave The Ex- Spartan    pirate
02/11/2012 at 10:48
xine267 wrote (see)

But Seren, what if you were desperate to buy a house, had made an appointment with someone you were told was a "Financial Advisor" and were told that it was absolutely fine to borrow 8 times your annual income because "everybody does it" and "your house will definitely increase in value by the time you come to sell it, so you'll be able to pay back the rest"? And then the "Financial Advisor" helped you fudge your supporting paperwork, either by telling a self-employed person to overdeclare their earnings for the 3 months they needed to provide proof of income, or by borrowing a lot of money from friends/family in the short term to show a large amount of cash coming into your bank account?

These are things that I heard Financial Advisors say to customers, and any concerns the customers had were brushed aside by someone arguably in a position of trust telling them that was the way things were done. I'm not being patronising but finances are a mystery to a lot of people, and they place a certain amount of trust in people who go by job titles like Financial Advisors to give them proper advice, not basically mis-sell products because they want the commission.

So you listen to someone tell you that it is OK to break the law, Commit fraud etc etc

And you go ahead and do it .................   More fool you

02/11/2012 at 10:57

I must be getting old. I can only find sympathy for people in difficult circumstances. No-one deliberately goes out to make wrong decisions. People do what they think is the right thing at the time. Anyone's circumstances can change.

Dave The Ex- Spartan    pirate
02/11/2012 at 10:59

I'm very old... And I didn't say I didn't have sympathy, But it was a free choice, the right thing being commit fraud ?,

and I do know how circumstances can change without warning !

02/11/2012 at 11:00

I just knew that Dave would be excellent value on this thread.

 

Dave The Ex- Spartan    pirate
02/11/2012 at 11:02

value ?  Does that mean you will pay me ?

02/11/2012 at 11:13

Yes, but the currency I will pay you with isn't sterling, it's attention.

 

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