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An indebted Fin24.com user wants to know what her options are:
A year ago I went to see a debt review company, which gave me a repayment plan.
Since then I was involved in a car accident and I have no insurance. The accident was my fault and I need to now pay damages as well.
My financial situation has changed drastically and I have to see the debt counsellor again to review.
I found that my expenses in fact are in such a bad way that I cannot even pay the lesser amounts given.
I have a 15-year-old daughter and we recently moved to a granny flat in the hope that this will cut down drastically on my expenses.
I am prepared to take on a second job but want to do it from home after hours to be near my daughter.
My expenses - with no luxury debt at all - are almost double my income. I have been trying to get hold of my debt counsellor, but have not been able to get an appointment.
Luke Hirst, managing director of the national debt management group DebtBusters, responds:You bring up some very interesting points for clients under debt review who have changes in their circumstances.
Unfortunately many consumers are finding themselves in a situation where they are faced with reductions in income, or their partner has been made redundant.
The first thing you must do is approach your debt counsellor and advise them of the situation and that you need a budget review. (As you are paying a monthly fee to your debt counsellor, it is your right to get an appointment and not wait too long.)
The debt counsellor will then go through a new budget with you and will advise your credit providers of a change in the circumstances.
From your mail you mention that your expenses are double your income and this certainly cannot continue, as it means you are falling further into debt.
Usually, as a debt counsellor we would need an amount available so that we can offer the credit providers a new payment plan.
However, in certain circumstances an application can be made to court advising of the reduced income and the need for a further six-month postponement on the payment of the debt. This is decided by the magistrate at the time.
- Fin24.com