www.iva.co.uk

Hi, Divorced 1 year ago & been a bit mad with credit cards over last 4 years since seperating. Now have 3 credit cards owing £23k & 3 loans of totalling 22k. Currently just moved in with girlfriend but no shared accounts/bills so could claim I was renting a room... Good news is that my take home is £3,500 per month, bad news it''s a contract so certain not to last too long. Have been promised an extension of 6 months just taking me up to May 2009.

I owe several other people money like Richmond council for £2k.. My main expense in child maintenance at £800 per month, gym at £80 per month, mobile at £40, pension at £140 and everything is loans & credit cards. I should be paying my gf something for rent & bills, etc. (Would it look better if did?

Basically, I am completely screwed with interest and could start to pay back if I wasn''t paying so much interest.

My big worries are:
1. What do I do if/when my job comes to an end? I do have an option of working for the company on a permament basis but then my monthly take home falls to £2k per month, which I can''t really afford. I would love to work for them My gf owns her own home so its not like I need to get a mortgage together with her or anything like that.
2. How does the fact that I am living with her change things? I have only been living with her as of the end of Aug''08 & don''t have any shared bills/accounts, etc. Is it better if I pretend I am renting a room?
3. One of the loans, for 8k was a secured loan on a property I no longer own as I was bought out by my ex-wife & her wealthy family. What happens now if I default on this loan?

Thank you in advance for all your help.
Jon

Hi jonnyboy and welcome to the forum

The first thing that you have to do is ascertain whether you have a debt problem or a debt management problem. You do have quite high debts, but if you are able to manage the monthly repayments then you ought to continue to pay them until your contract ends.

If you accept the salaried position, then your income drops dramatically, and you would need to work out if you could then actually afford to pay anything to creditors.

You should declare honestly the living arrangements with your current partner, and if you are going to eventually enter into some form of insolvency proceedings, you will not be permitted to carry on paying a secured loan on a property in which you do not live or have any other interest. Why are you still paying that loan?