The Debt Panel: At the mercy of our creditors and running out of time

▶ Our experts advise on the best approach for the Sharjah family with a combined debt of more than Dh300,000, who despite a restructure are struggling to meet payments

Iam in the worst financial situation, unable to control or pay my debts and don’t know how my family will survive in the UAE. Even though some of my credit cards/loans have been restructured, we are still facing financial difficulties. Last month I missed the payment on two credit cards. My monthly debt payments come to Dh7,000 whereas my salary is only Dh8,600 for my job as an admin assistant in the oil and gas industry. My wife earns Dh8,500 in the same industry and we have one daughter. Is there any way to consolidate all my liabilities into one payment? I owe the following:

Loans: Amount owed/ monthly repayment

Personal loan 1: Dh155,000/ Dh3,960

Personal loan 2: Dh20,000/ consolidated for 10 years Credit Cards:

Card 1: Dh5,000/Dh300 Card 2: Dh3,500/Dh832 (consolidated for 10 years with loan)

Card 3: Dh10,000/Dh350 (restructured) – missed last payment

Card 4: Dh16,000/Dh300 (restructured)

Card 5: Dh13,000/Dh308 (restructured)

Card 6: Dh10,300/Dh500 (restructured)

Card 7: Dh5,000/Dh400 missed last payment Meanwhile my wife also owes money. She has two loans and three credit cards with her repayments totalling about Dh6,000.

Our monthly expenses are: School fee: Dh600 Utilities: Dh400 House Rental: Dh1,200 Groceries: Dh500 Internet: Dh200 Remittance: Dh1,000 Transportation: Dh500 Total: Dh4,400

We also have around Dh100,000 debt with other private moneylenders that have monthly interest too. My wife tried for a top-up loan with one bank and buyout loans with others to pay off the private money lender but got rejected because of the Central Bank policy regarding Debt Burden Ratio (DBR). Is there any other way to get her top-up loan approved?

MG, Sharjah

Debt panellist 1: Philip King, the head of retail banking at Abu Dhabi Islamic Bank

Between your cards and personal loans, you have built up serious amounts of debt given your monthly salary – over Dh230,000 from banks, plus Dh100,000 from private moneylenders, and then your wife’s own liabilities on top. Given your predicament, it’s unfortunate that banks have continued to lend to you instead of intervening with constructive advice and support. This is a situation that the Al Etihad Credit Bureau was created to prevent, although I imagine you built up this debt prior to its launch.

The fact that you are starting to miss monthly payments on your cards substantiates the financial difficulties you currently face. It’s not quite clear how you have both become so indebted given your relatively controlled monthly expenses of Dh4,400.

Did you take out loans to make a major purchase, such as a house or car? If so, your priority should be to immediately sell such assets to pay off your card bills and private loan, depending on which one is charging you the highest rate.

As you state, with total debt over 20 times your monthly income, you already exceed the Central Bank’s DBR and banks are unlikely to be willing to lend to you, particularly if you are already missing payments on your cards.

It’s not clear as to your wife’s total debt, but with