Paying back credit card debt... options?

tankedtoo

Hi all

Maybe someone can advise me here. Money is tight for the last few months (sounds familiar I'd imagine) and I've got into the situation whereby I can't make my credit card payments. I've never in my life had this happen before in the 15 years of having a credit card.

We work with the government quite a bit (oh the joy) and it's been so up in the air recently we don't know where we're at or when we'll get paid. I'd arranged a loan to pay off the credit card with the same bank but since we haven't been getting paid as we expected by the government this now doesn't look likely at all.

So even though I have been keeping in touch with the bank they have handed it off to their collection section. I've spoken to the collection people but because of the small amount I can pay right now they are going to take legal action against me. I've explained that this is pointless, I don't have property or a car so they are only going to get what I can pay which isn't much right now. I just don't see the point in going down the legal route when I'll still be paying the exact same amount I'm offering to pay now.

I'm currently getting 1000 per month and 600 goes in rent and they are looking for 300 per month so as you can see that isn't going to work.

Any suggestions on what I should do?

Mmmm_Lemony

Switch to Halifax, intrest free for 6 months pay off bit by bit...

or

Credit Union loan and pay back bit by bit...

tankedtoo

Mmmm_Lemony wrote: »

Switch to Halifax, intrest free for 6 months pay off bit by bit...

or

Credit Union loan and pay back bit by bit...

Given that I'm in arrears on the current credit card I'm thinking it's very doubtful Halifax will go for it.

I've never had any savings with the credit union so they are unlikely to give me the sum I'm looking for.

Thanks though.

mandandpeter

I am so sorry to hear about your situation, We are in a similar situation here, too many debts and very little money, The problem is the debt collection agency saying that they are going to be taking legal action, well if you have told them your financial budget for every month and how much money you are prepared to pay them each month then they cannot do that, you have offered to pay them something each month until it is paid off, and as you cannot physically pay any more they have to execpt it, I am not 100% sure on rights etc as i am trying to find that out for myself, what I would do is call up your local citizens information centre and ask them for some advice, (everytime i call mine they are engaged grrr).

Good luck to you,

Cabaal

Mmmm_Lemony wrote: »

Switch to Halifax, intrest free for 6 months pay off bit by bit...

This may not work, two years back I owed a few K on my credit card and tried to switch and they didn';t want to hear it.

BOI have a Clear Card which offers interest free for 6 months,,,could try that if your already with BOI

The worse thing you can do in this situation is not tell your bank until they start threatening you, tell them now and make records to cover your arse...

jor el

If you're in arrears on your current card, and missing payments, then this will be recorded on your credit report. With that in place, you won't get a loan from any bank, nor get a different credit card. Your best bet is to go into your bank and talk to them about it. Could also check with MABS.

dh0661

MABS is way to go OP.

Their work load has risen dramatically in the last while so you might be waiting a bit before they can see you.

Get in touch with your local office ASAP.

Sir Oxman

tankedtoo wrote: »

Hi all

Maybe someone can advise me here. Money is tight for the last few months (sounds familiar I'd imagine) and I've got into the situation whereby I can't make my credit card payments. I've never in my life had this happen before in the 15 years of having a credit card.

We work with the government quite a bit (oh the joy) and it's been so up in the air recently we don't know where we're at or when we'll get paid. I'd arranged a loan to pay off the credit card with the same bank but since we haven't been getting paid as we expected by the government this now doesn't look likely at all.

So even though I have been keeping in touch with the bank they have handed it off to their collection section. I've spoken to the collection people but because of the small amount I can pay right now they are going to take legal action against me. I've explained that this is pointless, I don't have property or a car so they are only going to get what I can pay which isn't much right now. I just don't see the point in going down the legal route when I'll still be paying the exact same amount I'm offering to pay now.

I'm currently getting 1000 per month and 600 goes in rent and they are looking for 300 per month so as you can see that isn't going to work.

Any suggestions on what I should do?

Keep everything to written correspondence, including your budget sheet (I take it you sent that into the bank recorded delivery?)

They will threaten legal action and will probably go through with it but you have done the right thing by contacting them, explaining things and offering to pay what you can.
Important to stick to what you told them you can afford (obv backed up with your financial statement and payments of that amount), do not acquiesce under pressure to increase the amount as if you fail to keep up larger payments they will have you by the nuts.

They will attempt to 'bully' you into increasing the amount(threats of legal action, phone calls, letters) but you must be strong and don't let threatening letters get you down.
You are like tens of thousands in this country and you are doing the right thing in facing up to your debt - this will stand to you.
MABS advice in the event of a bank actually taking you to court in these circumstances is 'don't worry, don't be afraid of court'

#1 advice - keep everything to written correspondence.

Best of luck OP

7mountpleasant

Best bet is too short settle with the bank for about 30-35% of the amount and set up a payment plan for this amount, as bad as it sounds what might be better in the long run is just declare that you can't pay and leave them write it off , banks generally won't pursue credit card debt as it is unsecured and the legal costs of incurring a judgement is prohibitive, as you already have missed payments on your credit card debt as it is you chances of getting credit in the near to medium term is pretty slim, under ICB rules if a debt is written off or short settlement is made this fact is expunged from your credit report within 6 years (sounds bad but if you ain't going to be getting credit anyway does it make a difference?) so while you are trying to make an effort to make some payments at the moment you are in fact continiously updating you credit file with current deliquency thereby pushing out further and further when your credit report will be clear in the future, main point is get it sorted (written off or settlement) as soon as possible as its in your interest.

dudara

Moved to Banking & Insurance & Pensions

dudara

Jack Bauer999

Cabaal wrote: »

This may not work, two years back I owed a few K on my credit card and tried to switch and they didn';t want to hear it.

BOI have a Clear Card which offers interest free for 6 months,,,could try that if your already with BOI

The worse thing you can do in this situation is not tell your bank until they start threatening you, tell them now and make records to cover your arse...

think the clearcard interest free offer is only available for new customers only or so i was told by BOI when i tried to switch cards.

100gSoma

I know a friend at work who switched his credit card recently and he owed 4k. switched to halifax interest free. no problems.

stepbar

It all depends how much the credit card bill is. Bringing you to court for e.g 1k is a waste of time as the legal costs would make the exercise prohibitive. In fairness what can they do when the debt is unsecured bar bring you to court and agree a payment schedule with you? TBH I feel for your suitation. Many a day I used to bang my head off the table in frustration. I could never understand why credit depts were so unwilling to do restructures considering the debt was outstanding anyhow. It's as if they wanted it to be wrote off

tankedtoo

I told them my situation and offered to pay whatever I could but they weren't interested. They were looking for 300 per month and the best I could pay is 50 so we had a problem. They told me point blank they are going down the legal route. Now I don't have much in the line of assets to good luck to them with that.

In fairness the guy on the phone to me told me that he had no choice but to follow the guidelines as written down in front of him. He basically agreed with me that it was pointless to go the legal route with someone who A. is willing to pay what they have and B. Has no assets.

Thanks a million everyone for your help.

Bottle_of_Smoke

I know some people in the boi cc collections department and to be honest I'm pretty surprised by this thread, I'll ask my mate what he thinks of it.

Ask to speak to a team leader and explain your situation. Sometimes the communication in those type departments is appaulling, the guy allocated to your case could be new and scared of his boss.

If this goes to court I'd imagine you'll walk away with a very low monthly repayment provided you've been completely honest here and with the bank.

Also, you're down to 1K a month and paying 600 in rent, thats tough. Have you tried claiming partial welfare support or rent relief or anything?

tankedtoo

I suppose they may not take my word for it that I'm pretty broke at the moment and will try to recover what they can.

Haven't tried to claim anything, maybe I'm being proud about it I don't know. Think I'll check though.

dellas1979

How much do you owe? If you pay €50 a month how long will it take you to pay it off? What is the interest per month (money wise). From what you are saying €50 wont even cover the interest.

Times are terrible. Honest to God the stories and situations I am hearing and seeing people go through are terrible.

And you are earning €1000 per month is it? Full-time or part-time? Are you a student? sorry just need a bot more info before I can reply.

tankedtoo

dellas1979 wrote: »

How much do you owe? If you pay €50 a month how long will it take you to pay it off? What is the interest per month (money wise). From what you are saying €50 wont even cover the interest.

Times are terrible. Honest to God the stories and situations I am hearing and seeing people go through are terrible.

And you are earning €1000 per month is it? Full-time or part-time? Are you a student? sorry just need a bot more info before I can reply.

Well I used to manage at least the minimum payments (was getting paid a bit more a few months ago, and more than that again before) on a credit card with a limit of €11,250. Then I could use some of that credit if it was a bad month money wise. The problem was we had some cash flow issues and I was behind on the minimum payments. I didn't have enough money to get below my credit limit plus use some of that credit as I had sometimes being doing. And before you know it the interest piles on. So it's about 12,500 now, last I heard.

I come out with roughly €1000 per month at the moment and have 600 in rent to pay. It's basically full-time. On a brighter note it's all the money I owe in the world so I'm not so badly off I suppose.

dellas1979

Ok. Cripes. So what is the minimum payment per month at the moment? Were you on a huge wage or something to get a limit that high?


Could you not move home for 6 months or so until you have this under control? Could you not move into a shared house for a few months? You could save roughly half on rent so you could put that towards clearing the credit card.

I appreciate you were stuck financially, but you need to take control back and make some decisions. Ultimately this may mean you suffer for a while (i.e. if you are living with your girlfriend or if you are living in a luxurious apartment while paying €600 per month). I still cannot understand how you blew that amount of money if you pay €600 rent. I mean if you came on here and said your mortgage payments were €1,500 per month and you had to use the card to pay it I would understand. Without getting into too much, if you can/want to, can you tell us what you did?

tankedtoo

dellas1979 wrote: »

Ok. Cripes. So what is the minimum payment per month at the moment? Were you on a huge wage or something to get a limit that high?


Could you not move home for 6 months or so until you have this under control? Could you not move into a shared house for a few months? You could save roughly half on rent so you could put that towards clearing the credit card.

I appreciate you were stuck financially, but you need to take control back and make some decisions. Ultimately this may mean you suffer for a while (i.e. if you are living with your girlfriend or if you are living in a luxurious apartment while paying €600 per month). I still cannot understand how you blew that amount of money if you pay €600 rent. I mean if you came on here and said your mortgage payments were €1,500 per month and you had to use the card to pay it I would understand. Without getting into too much, if you can/want to, can you tell us what you did?

Well I can't make the minimum payment now at all. Minimum payment was about 300 odd a month but I could spend some of that if needed.

I used to make a lot more but have had a couple of up and down years. So it was all okay until I couldn't make the one minimum payment and it all started to build fast. I've had a credit card for years and it has gone up and down over that time so this didn't happen overnight.

I share an apartment in Dublin and my share is €600 which is normal. I work in the city so if I move out I'll have to pay for travel which I don't now.

Toots

Cabaal wrote: »

BOI have a Clear Card which offers interest free for 6 months,,,could try that if your already with BOI

The worse thing you can do in this situation is not tell your bank until they start threatening you, tell them now and make records to cover your arse...

I just had a look at the FAQs about the Clear card and came up with this

Can I do a balance transfer to the Bank of Ireland Clear Credit Card?
Yes, the card comes with a great balance transfer rate of 0%APR for 6 months, when applying online just make sure you complete the balance transfer details. The Balance Transfer rate only applies to balances from non Bank of Ireland credit cards.

so unfortunately that option would be a non runner. Also if you are in arrears on your current card, I doubt an institution would approve you applying for a new one, even if you're staying with the same bank.

jor el wrote: »

If you're in arrears on your current card, and missing payments, then this will be recorded on your credit report. With that in place, you won't get a loan from any bank, nor get a different credit card. Your best bet is to go into your bank and talk to them about it. Could also check with MABS.

I think MABS should definitely be your next port of call. I had a quick look at different banks websites at the loan calculators, and even if they did restructure your debt into a loan, the repayments for a €12,500 loan over 5 years would be about the same as your minimum payments are on the card anyway.

Could you not move home for 6 months or so until you have this under control?

Is there any way that this would be an option for you? There's little point trying to find another house share if your transport costs are going to mean it works out the same as your current situation. If you were able to move home, surely the transport costs to work wouldn't amount to €600. (I'm assuming here that your family home is available to you and that it's in the same county you work in. Obviously if your family home is in Cork and you're working in Dublin then this won't work.)

dellas1979

Do you have any assets at all?

I am afraid you ARE going to have to come up with something better than that you have to pay €600 per month on a house share. This is what is probably going to save your bacon, unless 12 grand magically falls into your lap.

Is there any reason you cannot move home? Can you do some costing transport-wise from there to work?

You downsize/down grade/live with more people/move home for 6 months or so. Paying €600 a month on a house share is f'ing crazy like especially in your situation. I dont mean to be mean, but am not surprise you have gotton yourself into this mess if you think that it is justified that you cannot pay-off your debts/make minimum payments because of your rent. That does not make one bit of sense. If you cannot go home, fair enough, but first get cheaper accomodation.

Sully

On the topic of paying back credit card limits, iv always wondered how it works on those student credit cards with the limit of 600 (or is it 500?). If a student owes the bank 300euro every month say and misses the payment date a few times but pays it in full days or a few weeks later (before the next payment is due) - how does it work for them?

Small amount less trouble, or due to it being a student card they are easier on them unless it goes into big money over several missed dates? Does the interest charged daily or monthly on missed payment?

Students seem a risky bunch.. maybe not tho.

(Also, if they did or did not miss min. payment - how does it work? So student pays of min payment and the rest over a few days, or fails to pay the min payment but pays it all in full over the next few days)

liger

Hi,

I swapped credit card from boi to halifax ( i was moving current and savings too). €9500 owed, they were only going to accept 5000 but i told them there was no point in having my accounts with them if they weren't prepared take the lot so the manager of the branch got it pushed through.

The thing is with these interest free deals. Yes they don't charge you any extra for 6months but you Still need to make monthly payments into the account. So the OP would still need to make this payment.

Toots

I think the OP's situation is different though, the impression I get is that he's stuck financially, the CC is in arrears and his wages have been cut. I can't see any other banks being too willing to take on a credit card from another institution when that's the situation.