My SOA is there any future?

calmspirit · 17 January 2007 at 12:52AM

Well, here goes, taking the bull by the horns, whilst shaking with fear!
I have to do something, I cant continue like this.
Lots of issues going on but briefly as possible. Split with hubby 2 years ago, long story but I was desperate and at the time could see no other option than what I did. I raised a 90k mortgage, gave him 60k to walk away, other 30k paid off existing mortgage we had. Property now mine. House worth approx 150k (to be valued by estate agents this Friday)Not a penny child support (another long story....this will never be an option for me)

So here it is, am basically trying to work out best way to have a home for my children and be able to eat ! I have 60K approx equity in my house, 90k interest only mortgage. Looking at downsizing but prices are ridiculous and even a small house in this area where i could get kids to their schools costs 135+ am searching desperately for a cheap property to do up! I want to stay on property ladder.

gulp!
monthly (tax credit and chb amounts worked out to monthly )
Income
wages 522.80
tc 583.58
chb 126.32
total 1232.70

expenditure
mortgage 464.00 (interest only currently at 5.65 discounted still 2 years to run on tie in)obviously this about to rise with rate rise)
counciltax 80.00
nationwide 16.39
tvlicence 11.37
o2 15.00on contract with 100 refund covering this until may
BT 15.67
gas 25.00 best guess after looking at 2 years of bills
electric 35.00 best guess after looking at 2 years of bills
water 31.60 monthly DD
broadband 14.99 keeps me sane
petrol 40 approx, live in a village, drive kids to school,to work
carinsurance 16
roadtax 16
food 200 based on last 3 months
lunchmoney kids 30
total 1011.02

I try each month to pay following
Barclaycard 200 i owe 3028, standard rates
Virgin card 70 15.9% last time i looked i owe 1300
IF card 41 current min payment 4.9% life of balance i owe 2039
total exp 1322.02

gulps again, i dont always manage to pay 200 to barclaycard but pay every spare penny to it, if emergencies come up i pay less, have some overtime pay i am using to fund this 200 but that will run out next month! so will have to reduce that

any comments welcome, and yes i am aware most will probably be slating me for claiming benefits...but i find myself in a catch 22 until younger child goes to secondary school when i will be able to work more hours.

thanks for taking time to get to end of this post.......took me ages to have the nerve!
sure i missed lots out!
why havent we got a 'hiding in the corner' emoticon?

specs_3 · 17 January 2007 at 1:00AM

I'm no good on these, but I will say that you should(if you haven't already) phone your card issuers and ask them if they can give you a better rate.
Pretend that you are looking to move elsewhere, they may try and tempt you to stay.

Good luck

fatbelly · 17 January 2007 at 1:24AM

calmspirit wrote:

any comments welcome, and yes i am aware most will probably be slating me for claiming benefits...but i find myself in a catch 22 until younger child goes to secondary school when i will be able to work more hours.

B*ll*cks! You claim what you are entitled to!

In fact i just checked your benefits as afar as I can and they seem about right (2 kids, no disabilities?). The only thing I noticed is that you are borderline for council tax benefit, so probably worth a claim. I take it the 80 pcm is after the 25% single adult discount?

I think your situation is manageable and with a bit of help you will be able to cut down your interest payments and find more to throw at your debts, which at 6.5k are not too bad.

studentphil · 17 January 2007 at 1:37AM

Well done on posting.So you need 300 in savings and extra income a month to make the problem stable at the very least.

So there is hope.

piglet6 · 17 January 2007 at 2:04AM

Welcome Calmspirit and well done for posting! :T No need to hide in the corner - everyone is here to help - and certainly nobody will slate you for being on benefits...we all do what we need to do according to how things are going at different stages in our lives - sometimes we pay into the system, and at other times we have to take it out of the system, but its swings and roundabouts, so there is no need to feel bad about it!

I am no expert, but the obvious thing to me is the food expenditure. If there are just three of you, get yourself over to the Old Style board where you will be amazed how they will be able to help you cut your budget back (probably to half of what you are spending now!). You will pick up all sorts of tips.

Also, do your kids have to have school lunches or could they take packed lunches? Again, the OS board will help with ideas for these, for literally pence per day! :rolleyes:

Re: your credit cards, are you in a position to apply for a 0% credit card (i.e. is your credit rating OK?) or even a low life of balance card? If so, it would help you to lose Barclaycard and Virgin, and at least every £ you pay them would be attacking the balance, rather than being swallowed up in interest charges. If not, then make sure that you are only paying the minimum payment necessary on all cards apart from the one with the highest interest, and then throw any extra cash at that one, because that one is costing you the most. Then, as that one becomes paid off, move down to the one with the next highest interest, etc, etc.

Don't panic - plenty of people will be along to help with your SOA, and I'm sure we'll have cut the £300 you need before you know it!

Piglet

all_hours · 17 January 2007 at 2:20AM

Hi,
can you post the APRs, credit limits and minimum payments for your cards. Based on your SOA you have £120 left to meet your debt repayments - is this enough to meet the total minimum payments.

There are a few things missing such as budget for birthdays, xmas, car repairs and servicing. Look at what you spent last year and divide by 12 to get a monthly amount.

Your mortgage is interest only - are you saving elsewhere to pay off the actual mortgage in the future?

Have you considered working a few more hours and paying for a registered childminder - then claiming tc for child care? Look on https://www.entitledto.co.uk and play around with some figures to see if you would be any better off.

Verbatim · 17 January 2007 at 3:12PM

Hi and welcome,

I too wodered if your council tax was after the single adult discount?

Claim what you're entitled to, it's what it's there for!

calmspirit · 17 January 2007 at 11:15PM

Hi again,

thanks for help so far. Had a result already today !!!!

specs/piglet... I phoned one of my card companies and asked if any special balance transfer rates.....they put me through to retentions....and then offered me a transfer at my original deal of 4.95 life of balance!!! Only downside is that my credit limit only allowed 1300 tranfser and they couldnt raise it ....BUT I have made my first saving......transfered 1300 from barclaycard at 19.9% to IF at 4.95% .. it's a good start!

so I now have 1729 owed to bcard at 19.9% credit limit 5200
still 1300 to virgin at 15.9% credit limit 5700
and now 3339 at 4.95% LOB credit limit 3700
tomorrow I will be looking for another card to transfer remaining bcard and virgin balances to.....then close those two accounts.

fatbelly, yes 2 kids no disability.....benefits correct and include 25% discount and about 20pence council tax benefit(or so it seems) they keep recalculating every time i earn £1 more they take it off me!

Have been busy looking at food tips on this site,, making menus is my next plan!

tustastic, thankyou but I will stay with current broadband as I do not want to get into a contract at moment incase I manage to move house as I have only 1 months notice to give with them

Feeling positive with just this first saving today, but still looking long term, as all hours points out...I have no emergency funds/xmas etc and also, more importantly.......and am ashamed to say.....no savings/investment plan to pay it off, so downsizing and reducing mortgage is probably essential to enable me to afford a repayment mortgage...........head still spinning around regarding this important long term decision

thanks again
hugs
xxx

calmspirit · 17 January 2007 at 11:47PM

just applied for M&S card at 3.9% LOB no transfer fee, fingers crossed!

feeling very positive for the moment, although ideas for long term would be most welcome......eg is it worth selling thishouse 150K with 90K mortgage getting smaller place to do up? moving costs high, redemption of current mortgage will be expensive due to 2 years to run on discount. Not sure I can afford to as even small 2 bed in bad area 135K ! may be worth staying put and dealing with problems here or release at least small amount of equity to pay debts? waffling now sorry ! dreaming too i guess!

Can mortgages be transfered to another property? i wonder? and if i did this on lower price house would i get the cash difference? ie to pay off debts and do up property, then move on?
waffling a lot tonight...it helps to get ideas out in open !

Long term plan is what i need!
thanks for taking time to read this !

piglet6 · 18 January 2007 at 12:13AM

Well done on making a great start, Calmspirit :T - you'll be saving loads on the interest you're no longer paying, and thats bringing your debt-free date closer!

Can't help re: the mortgage, I'm afraid. I think that mortgages are not transferable (because they are based on the value of a specific property, so I think you have to pay one off when you sell the related property and then take a new one up on the new property) although if both properties are worth more than the value of the mortgage, I can't see why it can't be transferred logically...?! (Realise thats not very helpful - sorry! :rolleyes:). Hopefully, somebody more knowledgeable than me will be along shortly. If not, why not try asking on the mortgage free wannabe board - they're pretty hot on mortgages over there...!

Piglet

chief · 18 January 2007 at 12:16AM

Hi Calmspirit,

Good work on your SOA. I am no expert, but a couple of suggestions...

-Contact your card issuers and get them to reduce the limits on your card, just so you dont get any 'urges' to spend on them (or cut them up!)

-You dont have to sell your house to release the equity. You could just remortgage, which could cover all your debts, though your mortgage payments would be higher, you should be able to go onto repayment and no interest-only. May be worth looking into?

-Forgot to add, though as your on a fixed rate period for your mortgage, there may be fees involved for a remortgage

Anyway, good luck, and try not to worry too much

My SOA is there any future?

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