Tag Archives: debt reasons

Raising the balance not going well!

By now you all know, I need to raise the £4500 in order to file my company insolvency.  This is not going well at all.

I have until the 21st November to raise at least half the money.  The usual options are not available to me so have applied for 5 householder loans.  As the loans are under 5K I don’t have to involve my ex, but declined on all 5.  Guess why??

Yep, because I am now involved in Insolvency!  Good grief, can it get any worse?   Yet another door shuts because of something else.  The world of finance is so deeply linked it’s scary.  So, it’s lie mode from now on then.

One other thing, every decline of credit is another black mark on your credit history.  Not that it makes a blind bit of difference any more as the chances of me ever getting credit again is pretty much zero.   But, it is annoying.

I still have 11 days though, 11 days to come up with other ways of raising the money.  Wish me luck.

Did I run over a Leprechaun or something??

Well well, after writing my previous blog post about my concerns for November, it just got worse!  Seriously, I have run over a leprechaun or let a posse of black cats cross my path?  As days go, yesterday was not a great day.

Started badly, had a minor toothache for days which increased to the point of emergency dentist visit time.  I hate the dentist anyway but sadly, I couldn’t eat on one side of my mouth so had no choice.  One X-Ray later, absess above a tooth in my jaw.  Oh joy, and the tooth is infected too.  So, this tooth is being removed next week but now I have a bill for the injection and removal, and antibiotics.  Not budgeted for this at all but I need to eat, although ironically I may not have much money left for food!

We move on…..

Knock on the door, cheery postman awaits with a parcel and an apology. “Sorry mate, just pulled your gate off the wall by mistake”.  Brilliant, so my front gate is now hanging off.  Had a look at it, yep it’s totally knackered so need a new iron gate and 2 new holes drilled in the solid brick to fit it.  That can wait though, just means animals can now wander into my front garden at will.

My car was struck from behind at the end of July, finally picked up yesterday.  I was supposed to get a high end car as a replacement however it is a small car.  A very small car.  Sucked this up but went out yesterday evening to a friend’s house and when I left I made a fateful decision.  Rather than take the motorway, I decided to go the back rounds over the hill back to mine.  Decision was based on the fact there had been a minor accident so I went the other way.  Came over the hill and got flagged down by a policeman, apparently I was doing 40 in a 30 zone.  Really?  I didn’t think that car did over 30.  The joke didn’t go down well so I got a fine and speeding points.

Got home, one of the cats has been sick over my fresh bedding.

What is going on eh?   My luck appears to be on a downward spiral, not entirely sure why.  The problem with being in debt is everything seems worse when it happens.  If I wasn’t in debt, a broken gate / dentist bill / speeding ticket would be something you could suck up.  But when you are already struggling, new bills seem 10 times worse.

I love this quote:

The only good luck many great men ever had was being born with the ability and determination to overcome bad luck.

Still trying to remain positive but, come on, give me a break!

Lessons I have learnt about debt

When you are desperate to clear your debts, you look into as many options as you can.  And, those options have been repeated by well being comments via this site.   They are all top tips and good advice, however this is what I have found out.

There are many ways to help with debt and financial difficulty, some work, some don’t and some are not applicable sadly.   What I have found out is that is depends on your debt and current situation. The factors that affect how you can get help are your job, the money you earn, who you owe money to and your health.

There are only 2 easy ways out of clearing your debt, and I use the word easy as your debt will be wiped out BUT your life as a future creditor is over.  They are, of course, Bankruptcy and Insolvency.   These 2 options come with drastic consequences but depending on your life situation, it may be a great move for you.  For instance, if you were single with no kids and could start again, is losing your home to clear your debts a bad thing?  Compare that with a family faced with the same option, and the single person can look positively at it.   Insolvency is similar, but costs a fair bit of money to set up.  It is unlikely you will have a spare thousand or 3 to set it up but you CAN include tax debt and it is unlikely you will lose your home.

Tax debt, we have mentioned it so many times, but any money you owe to the Government cannot be included in any conventional debt relief schemes and loans.   I am stating this fact again so that you understand why I could not take up some of the options.

Loans – so many loans available, but in 2 categories.  Unsecured and Secured.   Unsecured is not an option for anyone with bad credit.  It is a NO immediately.  So, secured loans are an option.  The drawback is obvious, you are moving all your debt into a loan directly against your home.  The interest rates are quite high too.  For example, I looked at a £25,000 secured loan and the amount to pay back was a hefty £33,000.  Additionally, you can only borrow an amount that is comparitable with your equity.  So if you have 10K equity, you can only borrow 10K.

Bad credit equals no new credit cards, so no consolidating balances onto different credit cards with lower interest rates.

Bank loans, again if you are honest you will lose.  Sadly, I was too honest for my own good.  Mention tax debt and it is goodbye sir, good luck.  Quite why HMRC debts are ringfenced are beyond me.  Same with mortgage payment holidays or partial payments, mention what it is for and it is a NO.

Debt Charities, wonderful for advice but really geared for smaller debt problems and often solved by re-budgeting or making key changes in your lifestyle.  They do a wonderful job helping people but again, I would say this is for ‘normal debt’.

So what does work?

Well, for me, it looks like Insolvency.  However, there is only one other thing that has helped me, and that was the use of a reputable debt consolidation/management company.  I did my own research, found a good one that I will happily recommend them should anyone ask.  It was the only option whereby I could include most of my debts and debtors and have them all move into a monthly lower payment.  The company got my interest frozen for 12 months and a decent payment plan which meant, importantly, that I was still decreasing the balances.  The cynical will state you pay a fee each month, and you are absolutely right to say that.  I pay £30 month fee, now if you compare that to the combined interest of all the bills which was £136/month then it was worth it.  The extra money left allowed me to pay back 2 other loans.

To summarise, research all options and don’t go with the popular choices.  Not all of them are a fit for individual circumstances, most importantly don’t ‘panic sign up’ to things.  Honestly, if you have a tax debt like me then don’t waste your time on standard solutions, as it cannot be included.

It is a world geared towards the wealthy, if you are down and out you have to fight like mad to recover from it or get really lucky.  That is how I have found it to be.

that’s it then….doomed

What a shocking day this has been, 2 calls and 1 letter later and I am in worse trouble.

If you have been reading previous posts you will know the attempts I have gone to to get empathy and help with no avail.  Today pretty much summed it up.

Mortgage Company – 2 month holiday declined, equity release plan declined

Barclays – repayment of account charges and interest declined

HMRC – another fine.

Yes, that’s another fine from the HMRC.  So in the course of 7 days my debt with the HMRC has increased by a further  £1100 in fines and interest.  What can I do here, the debt increases and I can’t pay it.  Inevitable, next month, due to non payment I will be fined again.  This is a constant never ending cycle of pain.  How can I ever get out of this if the figure keeps moving?  I really have no chance do I?

And no institution will help me.  I have been a customer of my bank for over 25 years, they could see I was struggling but not say tough luck.  And you know why the mortgage company won’t help.

That’s society then people, love you when you are up, won’t help when down.

So what now?  If I am honest…nowhere.  I really have nowhere else to go now except the obvious one, so it’s time to sit my family down I think and explain what is going to happen.

If I am ever in a position of extreme wealth, I will make sure I own a company that people can come to with similar stories who just need help because there sure isn’t anywhere right now.

Not a happy blog today I am afraid but it’s a very low point for me.

A kindred spirit in an old friend

Isn’t it strange how life goes?  A while back I was back in contact with a very good friend of mine that I hadn’t seen for almost 10 years.  Caught up with her a few times but last night I got a text asking if I fancied a chat later.

Firstly, you should all know, she knows nothing of my situation.  Why would she, after all I took years to tell my own family so I certainly wouldn’t have told her!  Anyway, I digress..

So what was the chat about, well it was an emotional one.  It is lovely that someone considers you worthy of enough to chat about their worries, and get your opinion.  The chat was about money, more so the financial hardship she was experiencing.  It was like hearing my own story, but a story I should have told.

The words about hardly having any money left, worried how she will support her children, living on the edge.  Words I know so very well.  For me, she chose the perfect person to speak to as I can offer my tips on making money last, how to increase your funds, all legally of course.  Simple methods..

But then, after we spoke for a while, I confessed my story.  Even though my debt and financial troubles eclipsed hers it still gave her a perspective that her situation isn’t a loss.  In fact, to me it sounds like a milestone I want to hit!   Yes, I know that sounds really odd, but her figure is way under mine!

Do you know what this highlights?  You feel so totally alone but, in reality, there are so many people in the same position.  It’s a shame there isn’t a big door somewhere that you can knock on, and when it opens you say “Hello everyone, I am really in trouble and I need someone to listen who won’t judge me”, and there are hundreds of people in the same boat.  Debt makes you feel so alone, it really does.

The problem is that so many doors are already closed before you try them, like banks and loan companies.  Perhaps the old friend getting in touch, and wanting to get advice on a similar problem is a sign to keep going.  A sign you can ask for help, and to invite people in.

Or, karma wise, if I have offered help then something good will come my way.  If I could afford a lottery ticket I would have bought one!

Oh HMRC, give me a break!

The readers with better memories will recall that I get continually fined by the HMRC, despite negotiations and pleas.  These fines make up a 3rd of my debt to them, and it grates on me every day.

Readers will also recall I get my mail redirected to my parents house.  Popped there today to collect my mail, and there is a letter from Companies House. This letter, for once, is expected as I have closed my company and removed it from the VAT register.  I thought this letter was the confirmation.

When you close a company, you submit final accounts.   Informed HMRC they would be late as we have to account for all my debtors INCLUDING the HMRC, so we had to wait for the amount I owed.  Got all the information, posted the accounts 4 weeks late.

So I open this piece of mail and what do I find?  £350 FINE FOR LATE FILING OF ACCOUNTS, PAYABLE IMMEDIATELY.

Are you actually joking me?   I utterly despise them, it is a waste of time ringing and explaining things.  Anyone else dealing with them, don’t bother.  Just pay what you can, and submit what you can, you will get fined anyway!

Net summary, my debt has increased AGAIN by £350.  Yet again, due to a fine.

How can I ever get out of this nightmare with them?   Lottery win, the time is now!

Still smiling though…

Where did this debt come from?

This will prompt some sneers, “surely this man knows how he got into this hole?”.  Well…partly, genuinely I know some of the history and can see some of the origin of the mountain.  But, equally genuinely, I didn’t see the rest coming…

My first debt is the obvious one, credit cards!  Everyone had credit cards, they were easy to get, and paying the minimum off each month seemed ‘logical’.  I had 2, I still have 2!   The problem is, once you have a credit card you are always behind with money.  You’ve already spent it, but you don’t want to pay it all off or it eats into your pay.  Very immature outlook, but too late to moan about it now, I will just use the experience to discourage my children from having them.

So here is some irony, between 2000 and 2008 I had 3 large bank loans, 2 to buy a car and 1 for a house extension.  I say large, two were under 3k and 1 was 9.5k.  Why the irony, well I not only paid them off, I paid them off early!   Can I get a loan nowadays, nope, not even £500!   I think the loans were a challenge and pride for me, I wanted to pay them off.  I don’t know why I viewed the credit cards differently, probably because they were so flexible.  The loan was a set amount and you HAD to pay it.  And I did.

My debt has built up through 4 reasons:

1. Bad decisions

2. Other people’s bad decisions

3. bad luck

4. HMRC (see blog 2)

The second debt was HMRC, we will explore this many many times.  Built up through inexperience on my part as someone who was self employed, some honest mistakes, some errors from an accountant and some errors from the HMRC.  Either way, it has been left to me.

The third debt, it’s to people I know.  Cue the horrified looks, but these people helped me.   I am still paying them back and they are my priority.  What it showed here was faith.  You see, you are desperate, you try the bank and other lending entities.  You outline your problem, and how you can pay it back.  I think they are already writing NO on the form when you walk through the door.

I will explore each of the 4 reasons above fully in the weeks to come.