D is for… Dealing with Debts

Posted on 19th May 2010 in adultery/ benefits/ counselling/ debt/ divorce/ house/ lies/ solicitor

If you are in debt and feel that you need some help, I hope that reading this will reassure you and offer some useful suggestions.

If you’ve read A is for… And then he left me you will recall that my ex husband left me quite hideously in debt. This was in 2004 which was just before the bankruptcy laws changed – I have to say if it happened to me now, rather than then, I would given serious thought to going bankrupt. Even in 2004 (when the after affects of bankruptcy were much harsher) every debt advisor I spoke to told me to file for bankruptcy.

So, he left on 9 July 2004 (the night before our youngest son’s 3rd birthday). I had no warning of this and, although people find it hard to believe, I had absolutely no idea that it was going to happen.

I knew we had debts, money had been somewhat scarce for several years as he had been frequently ‘off sick’ with a bad back and depression. We had re-mortgaged the house several times, once to consolidate all the debts – except that when the money came through he managed to convince me that he NEEDED some tools (although only dewalt ones obviously), that he DESERVED a playstation, and an x-box, and some games, and some new clothes, and we NEEEDED a new lawn mower etc. So only a small amount of debt ever got repaid.

His attitude to money was always poor. Even when he wasn’t working he would think nothing of spending £5 on a playstation magazine and then say that we couldn’t afford proper  nappies. I stood at the checkout in tesco more times than I care to remember with flaming red cheeks when my debit card was rejected, because he had withdrawn cash to spend on HIM without telling me and without caring if it left enough money for bills and food.

My mum set up a bank account and started paying £20 a month into it, she said it was for me to treat myself with, I didn’t tell him about it, it didn’t seem deceitful as I only ever spent the money on food shopping anyway. Once when I went to withdraw the £20 to use for shopping I was stunned to see there was no money available – when I checked further I saw that the £20 had already been withdrawn. I asked him about it, he said that found the card in my purse and we’d needed milk so he took the money out. The pin was my birthdate – he had guessed it. From then on he would wait for that £20 to land and whip it out straight away. He often drove to the cashpoint at just gone midnight to make sure that HE got the money.

Below is a list of the debts I was left with, this is just from the paperwork that I can find now, I think there were more:

Nationwide negative equity £12,000 – paid £4,600
Halifax overdraft £1,555.54 – paid £1,150
Barclays business overdraft £1,840.69 – paid £921
Barclays overdraft £974 – paid £750
Barclaycard £2,292.35 – paid £1,375.41
Debenhams store card £2,635 – paid £2,355
Dorothy Perkins store card £1,435 – paid £910
Capital One Visa £879 – paid £425
Capital One Visa £1,529 – paid £1,100
Business loan £5,000 – £2,000
Woolwich overdraft £1,841 – paid £1,400
Alliance & Leicester Loan £1,428.71 – paid £800
M&S store card £893 – paid £715
Thames Credit £932 – paid £800
Welcome financial services £781.20 – paid £781.20

As you can see, even with just the debts that I can remember, I was left with £36,016.49 of debt outstanding which cost me £20,082.61 to pay off. I’m pretty sure the total amount I spent paying off debts was closer to £28K so there must be a few that I’ve missed. It took me 6 years – the last debt was cleared in February of this year.

My ex took one debt, an Abbey National current account overdraft of around £700. This was in joint names but he made me sign the account over to him so that he still had a bank account – this, of course, left me without one and with a completely shagged credit rating which meant that I couldn’t get one.

My divorce Solicitor told me that I wouldn’t be able to assign any of the debts over to my ex. She advised me to go bankrupt. The CAB helped me set up a payment schedule – paying £1 a month to each company and advised me to go bankrupt. The CCCS agreed with the CAB.

I didn’t answer my home phone for several years unless I was expecting a call, as most of the time it was a debt company chasing money, I still find it hard to answer it now. Some companies are ok to deal with – some are terrifying.

What makes it even more complicated is that most companies sell on debts, meaning that it was almost impossible to keep track of who I had paid what to – I’m quite sure that I repaid some of the debts twice! For example – the £1,840 debt to Barclays was at one point being chased by Aplins Solicitors, DLC (Direct Legal & Collections), Hillesden Securities Ltd, Buchannon Clark & Wells and Ruthbridge Ltd. That is 5 different companies all chasing 1 debt. All 5 companies claimed theirs was a different debt and that I HAD to deal with them. Sometimes they phoned, sometimes they wrote, sometimes they sent baliffs round – mostly it was a combination of all three methods. Like most of the debts, this particular one was a joint debt so I gave all of them my ex’s details too – I had to laugh one day when a guy from Buchannon Clark & Wells rang me to say that he thought my ex was a complete c*** and that he knew someone who could ‘have a word’ if I wanted him too… Even funnier when my ex rang me the same night in a right state to say that he had just received a threatening phone call and it sounded just like the guy from BCW…

The point of this post is twofold, one to say don’t ignore your debts. They truly don’t go away they just get bigger and more unmanageable. Get a copy of your credit file – this is a huge step towards taking control, yes it will probably tell you things that you don’t want to know, but do you know what? The debts are there whether you acknowledge them or not! You can get one month’s free trial from Experian. Get an A4 ring folder and some dividers and make a file for each debt, then make an appointment to see a debt adviser. A FREE one like the CCCS. DO NOT PAY ANYONE TO ‘SORT OUT’ YOUR DEBTS! Either phone them or write to them asap. Tell them you are experiencing financial difficulties. Tell them your income and your outgoings – make sure you include everything that you have to pay out for. They will help you. If you have some money to repay a debt, NEVER repay the full amount – always offer a reduced settlement figure – 99% of the time they will either accept it or negotiate.

MY DEBT FILE!

Secondly – do not let your solicitor leave you with all the debts! I am so angry that my solicitor allowed me to be left in this situation. Now, 6 years on, my debts are all repaid. I will never have an overdraft or a credit card again, ever. I won’t let my new husband have them either. It isn’t always easy like living like that but we do. We currently rent a house as we now have to save up a deposit to buy, this has set me back massively in terms of ‘steps on the ladder’.

But, having said that, the past is all behind me now, I’ve learnt from it and I can concentrate on the future.

I am very happy to try and help if you have any queries that you think I may be able to answer – just let me know on the comments section below and I will reply to you.

UPDATE – 2oth May 2010 – To answer some questions that have arisen from this post:

1. The negative equity was from a flat that I owned before I met my ex. It was rented out but I had a few problems with tenants and often  had to meet the mortgage payment on that as well as on the house I shared with my ex. When he stopped working for frequent and ever increasing periods, my salary was insufficient to pay both mortgages. He persuaded me to hand in the keys – the second biggest mistake of my life – if I still had that flat and sold it today it would net me 85K profit.

2. All of the debts except the dorothy perkins/debenhams cards were in our joint names. However due to joint and several liability the debt companies had the legal right to pursue me for the entire debt. They chose to do that as because as a mother of 2 young children I was an ‘easy target’, threatening phone calls and visits from big scary men terrified me.

3. Why didn’t I leave him? That is always so hard to answer! I didn’t feel it was acceptable to leave him for being off work – he was depressed, you can’t leave someone for being depressed can you? I couldn’t leave him when his business failed – that was just bad luck, wasn’t it? I couldn’t leave him – because it was christmas, fathers day, mothers day, the kids birthdays etc etc. I couldn’t break my marriage vows – I came from a broken home, I didn’t want me kids to as well. But mainly, I couldn’t leave him because I didn’t have enough self esteem to realise that I should accept all his shit.


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21 Comments

  • Reply Just a typical dad 19th May 2010 at 5:33 pm

    wow really good post! compared to my debts that i wrote about the other day yours are huge! im glad you have sorted them out now and you did it on your own terms. I have also had dealings with BCW they were one of the better ones! (maybe you should of taken them up on there offer hehe) reading about blokes that have done this sort of thing makes me mad as it gives us all a bad name! i hope you win the lottery and see him on the way to collect your winning that will show him! 😀 good look in your financial future!

    • Reply mrsljhall 19th May 2010 at 5:43 pm

      Thank you! There has been many a time when I would have sold my soul for someone to ‘have a chat’ with him…

  • Reply Just a typical dad 19th May 2010 at 6:20 pm

    hehe im sure if you phone BCW the offer is still there! 😀

  • Reply becky 19th May 2010 at 6:33 pm

    I’m about to file for bankruptcy – my soon to be ex has taken all the equity out of the house making my IVA null and void…

    apparently I shouldn’t have been signed into an IVA any way and may get compensation for that – no doubt it will get swallowed up by the bankruptcy!

    • Reply mrsljhall 19th May 2010 at 6:37 pm

      Assume that it will. Bankruptcy is a good option right now, it only applies for 1 year – I do wish I’d done it as I it took me 6 years to repay all the debt anyway. If I’d filed for bankruptcy then I would have 6 years worth of savings now! We live and learn. I hope it works out well for you xx

  • Reply Single Dads Diary 19th May 2010 at 7:42 pm

    I think you’ve done a fantastic job, and are an inspiration to us all.

    If my marriage hadn’t have ended when it did, it may have been me writing a post like that.

  • Reply Susie 19th May 2010 at 8:12 pm

    Good for you.

    I have been meaning to write a post about budgeting and debt for a while. i volunteer for an organization that helps people in financial problems-but no actual gifts of money. We teach them to budget, live according to means and repay debts.

    BTW-you would love http://www.daveramsey.com He has a great program called financial peace university and he also has great free podcasts.

    Great job.

  • Reply mrsljhall 19th May 2010 at 8:23 pm

    Thank you very much, I will take a look :o)

  • Reply Magic Mummy 20th May 2010 at 3:41 pm

    I have a job where I help people who are experiencing financial difficulty and the relief that they feel when repayment proposals are agreed us unbelievable.

    I have debt but at the moment it’s manageable and I’m paying it back as much as I can when I can.

    Thanks for sharing x

    • Reply mrsljhall 20th May 2010 at 3:46 pm

      Thank you and well done you for helping others – it is so stressful to live with x

  • Reply Sleepless_Mum 20th May 2010 at 4:03 pm

    Wow this is a great post. I’m so sorry you had to go through this, it sounds like it was so difficult for you, and I hope your advice is of use to other people. I think we’re often so scared of talking about money in this country that there are a lot of people out there struggling much more than they need be because, like you said, they don’t want to think about it. I’m very glad you’re debt free now and hope you get that house deposit saved up soon xx

  • Reply Nickie@Typecast 21st May 2010 at 1:03 pm

    Just dropping by to offer a little ((hug)) – one I think you need.

    This was a very good post and must have take a lot of guts to write x

  • Reply JallieDaddy 3rd January 2011 at 4:39 pm

    Really good advice! In addition, I understand that if you agree a payment schedule with a creditor – or even make ‘a reasonable offer’ of one & stick to it – that they have no right to harass you further, either directly or via a 3rd party. If they do you have the right to sue for Harassment.

    Brilliant that you managed to pay everything off!

    I would have thought though that you could take legal action against your Ex to recover at least half the debt: especially as it sounds like most of it was his.

    Onwards & upwards!

  • Reply #debtday: A client's story | CCCS | MoneyAware 10th May 2011 at 10:42 am

    […] made a real difference – they were much more accepting of the situation.As detailed in my previous post, it did take me several years to repay my debt, but I couldn’t have done it without that […]

  • Reply Dean 17th May 2012 at 2:41 pm

    Wow a really inspirational story makes me want to really hammer my current debt. 14k, recently considered bankruptcy but came back from the brink its story’s like this make me think i really can bring it all full circle.

    • Reply CoffeeCurls 17th May 2012 at 2:56 pm

      Hi Dean,

      Thank you for your lovely comment. I am sure you will sort your debt out as it sounds like you really want to. I can tell you first hand what an amazing feeling it is to see your credit report come back with the top score! I now have a mortgage (which I never thought would be possible!) and no other debt, and I feel really proud. Good luck.

  • Reply Witheld 17th May 2012 at 8:04 pm

    Inspirational story! I’m 3 years into a Debt Management Plan with the CCCS to pay off a similar amount to yours/your ex’s – £39,000 including my bank overdraft and student loan! Even now, I’ve only paid off about £10K due to the interest a number of companies have continued to charge! But I’ve just had a stroke of good fortune in that a family friend has agreed to buy my house from me to release the available equity to pay off most, if not all, of the outstanding debt.

    One question: does your credit record not remain poor for 6 years AFTER the debt has been paid off? i.e. wouldn’t it have taken until at least February 2016 before your credit score would return to its maximum?

    • Reply CoffeeCurls 17th May 2012 at 10:36 pm

      Hi there, glad things are going well for you. Make sure you ask for minimum settlement figures when you pay off the debts. Regarding your question, I think (and you may want to double check this with the CCCS or CAB) that CCJs stay on your record for 6 years whether they are repaid or not. Open accounts, ie anything you are repaying monthly will stay on there for 6 years after they are paid off. I hope that makes sense but do get a professional opinion :)

  • Reply Nichola 5th September 2013 at 11:01 pm

    I have debts of about £24k and can only pay such a small amount I don’t know if I can see the light at the end of the tunnel! at 36 I almost feel like my life will be over by the time it’s all paid.

    • Reply CoffeeCurls 5th September 2013 at 11:22 pm

      Who is helping you manage your debt?

      There are plenty of options available to you, please don’t be downhearted.

      You never know what is round the corner.

      If you aren’t working with anyone to help with your debt let me know as there are lots of free organisations who can support you x

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