Need help with debt - quick!

[buggerlugges]

My partner has �12k in debt - �2.5k on a credit card, �1000 overdraft and the rest as a loan due to pay off in 2007. He only earns �15k and in the past four months has paid �1200 in payments but only actually paid �150 off his debts. (His payments don't leave him enough to live on so he relies on his overdraft) What's the best way out of this mess? We've already consolidated twice and got a good rate for the loan cut up the credit cards (which are interest free for a few more months). I don't want to remortgage my house and reconsolidating seems to just make things worse - and he spends again. He refuses to go to see a debt counsellor. What are the options? I am really careful with money and I having sleepless nights over his debt. Help!

[Katiebee]

I think you have to persuade him to see or consult a 'debt counsellor'. The Citizens Advice Bureau usually have a financial helper who could point you in the right direction, or try the National Debt Line, or Consumer Credit Counselling Service. The latter will ask for a full, very detailed summary of your income and outgoings. They will advise you how to approach your creditors to explain that you are unable to meet the required payments, and will work out a budget for you to try to stick to - which means you will have so much each month for your essential bills like mortgage, gas, electricity etc, and all other household bills, and what is left will be split between your creditors. You make a monthly payment to the CCCS and they distribute the funds accordingly. Burying your head in the sand will only make matters worse as, you have found out, does consolidation. If you explain to your creditors you are in difficulty and show that you are trying to address the situation, they will be much more inclined to help you than if you just solider on or fail to meet the payments. They will also look more favourably on you if you use a charity based service, such as the CCCS, which makes no profit and charges no fee, rather than the likes of Baines and Ernst, who do the same kind of thing but expect you to pay them for it! Understandably, creditors would not take too kindly to you if you're giving your money away to a firm like B&E, when it could be going on paying off the debts. The longer you leave things, the worse they will get. Act now before it does so and you'll start sleeping again at nights. Good luck to both of you.

[Katiebee]

PS Credit card firms will also normally stop charging interest on the outstanding debt if you are on debt management programme.

[gnasher]

go to the cit adv bur and enquire about a trust deed .

[Gandy]

Er, no matter how I try I can't seem to work out where your cash is going. You say that you have a good rate on your consolidation loan and 0% interest on the credit cards. How does that explain a �1050 interest payment??? Based on this, how is the loan going to be payed off by 2007?? Check the figures - they do not add up

[johntheplamf]

I think what you want to do is give the guy an ultimatum, Either see a debt counsellor or tell him to sling his hook. I don't see how it's fair that you do all the worrying and he goes out and spends again

[buggerlugges]

Thanks for all your advice. My partner has a 9k loan that has �8415 outstanding on it (that includes interest); this is due to be settled August 07. His credit card is interest free and has �2500 on it and his overdraft is �1000. The total amount of debt is �11915. Payments are �220 for loan and �80 for credit card. Overdraft remains at limit. My partner struggles to meet the �300 payments as, after housing costs, travel to work, etc, he is left with �50 a week. Okay on a day to day basis but not when things like car insurance, car tax, etc. crop up. He also smokes which really eats into his budget. At �300 a month, the total debt should pay off in 3 and a half years - but that's if he doesn't add to it!!