Newly married, a life to plan, time to man up!

:(

Hi All,

Second post on this site, but first of real significance.

I married the girl of my dreams in June and started making plans for our future quite recently. A move back to our parents in 2019 is on the cards to save for a house deposit, but I'm worried that my credit rating will rule us out of getting a mortgage.

I'm in debt, my wife is clean as a whistle. She knows about my debt, but not the true scale or the lack off effort I've put into clearing it.

My debt is somewhere in the region of £13000 (not including a student loan that I let trickle out of my salary every month).

We're London based and I'm lucky enough to have a good salary (£50k per annum). But I'm terrible at budgeting and have buried my head in the sand for far too long.

A few questions that I'd hope you can all answer:

Should I go to stepchange?
What do they actually do?
Do they harm my credit rating?

Where do I start with tackling my debt???

This might be a slow burner, and so please bear with me, once I've got the bit between my teeth I will nail this (ex profession rugby player). But I really do need a helping hand.

Hope I've come to the right place...help me realise my dream...

Comments

  • MrsSave
    MrsSave Posts: 1,817
    First Anniversary Name Dropper First Post
    Forumite
    http://www.stoozing.com/calculator/soa.php

    The link above is for a soa (please format for mse at the end). Fill that in accurately which will make your situation clearer. But, I'm guessing that £13k debt on a £50k salary - you should be able to deal with it without entering into a dmp (the best option if you're looking for a mortgage soon). I got a mortgage about 5 years ago on half your salary with about £4K of debts (though I hadn't defaulted on any).
    Starting a new debt free journey
    Starting Debt: £5,250
    Current Debt: £4,995.50
    Amount Paid: £254.50 Percentage Paid: 4.84%
    Emergency Fund: £350
  • Thanks MrsSave

    What are the acronyms everyone is using on similar threads? SOA, DMP

    Shedding more light on the situation...

    I have defaulted on several items and two of my cards are with debt collection agencies.

    To clarify, I'm not looking for a mortgage just yet, this is something we're looking at around 2021.
  • sourcrates
    sourcrates Posts: 28,717
    First Anniversary Name Dropper First Post Photogenic
    Ambassador
    SOA - statement of affairs, so we can see where your money is going.
    DMP- debt management plan, informal debt solution.
    DRO- debt relief order, more formal debt solution for debts up to 20k.
    IVA - again, a more formal debt solution for debts over 20k.
    Bankrupcy- speaks for itself.
    I’m a Forum Ambassador and I support the Forum Team on the Debt free wannabe, Credit file and ratings, and Bankruptcy and living with it boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.For free non-judgemental debt advice, contact either Stepchange, National Debtline, or CitizensAdviceBureaux.Link to SOA Calculator- https://www.stoozing.com/soa.php The "provit letter" is here-https://forums.moneysavingexpert.com/discussion/2607247/letter-when-you-know-nothing-about-about-the-debt-aka-prove-it-letter
  • Thanks Socrates

    Does a DMP harm my credit rating? Is this something that an external company sets up and takes a fee?
  • Does a DMP harm my credit rating? Is this something that an external company sets up and takes a fee?[/QUOTE]

    Some companies take a fee but Stepchange, Christians against Poverty (I think) and possibly others are free.

    Your credit rating could be affected. There are more details here.

    https://www.citizensadvice.org.uk/debt-and-money/debt-solutions/debt-management-plans/debt-management-plans-explained/credit-rating-impact-of-debt-management-plan/

    Unless there are unusual expenses in your SOA, with a good salary you should be able to pay off a good chunk of that debt by 2021.
    Aiming to make £7,500 online in 2022
  • Hi
    Welcome to the forum. You'll get some great advice here.

    I think you should consider sitting your wife down and telling her the full extent of your debt and your plan to repay it. A lot of people on this forum have been in a similar situation and 99% of the time, their partners have been very supportive.

    Posting a SOA is the best place to start. On your salary, you will be able to clear £13k relatively easily with some budgeting.
  • Hi All,

    Sorry for not getting this up sooner.

    So what is it telling me?? is my situation bad?

    Am I going to make it to that mortgage application in 2020?<pre><b>Statement of Affairs and Personal Balance Sheet</b><b>

    Household Information</b>
    Number of adults in household........... 2 (Not included wife's income but halved rent, I pay all bills due to significantly higher salary)
    Number of children in household......... 0
    Number of cars owned.................... 0<b>

    Monthly Income Details</b>
    Monthly income after tax................ 2780
    Partners monthly income after tax....... 0
    Benefits................................ 0
    Other income............................ 0<b>
    Total monthly income.................... 2780</b><b>

    Monthly Expense Details</b>
    Mortgage................................ 0
    Secured/HP loan repayments.............. 0
    Rent.................................... 750
    Management charge (leasehold property).. 0
    Council tax............................. 131
    Electricity............................. 22
    Gas..................................... 23
    Oil..................................... 0
    Water rates............................. 30
    Telephone (land line)................... 0
    Mobile phone............................ 45
    TV Licence.............................. 12
    Satellite/Cable TV...................... 0
    Internet Services....................... 29
    Groceries etc. ......................... 300
    Clothing................................ 50
    Petrol/diesel........................... 0
    Road tax................................ 0
    Car Insurance........................... 0
    Car maintenance (including MOT)......... 0
    Car parking............................. 0
    Other travel............................ 128
    Childcare/nursery....................... 0
    Other child related expenses............ 0
    Medical (prescriptions, dentist etc).... 0
    Pet insurance/vet bills................. 0
    Buildings insurance..................... 0
    Contents insurance...................... 19
    Life assurance ......................... 0
    Other insurance......................... 0
    Presents (birthday, christmas etc)...... 0
    Haircuts................................ 16
    Entertainment........................... 200
    Holiday................................. 0
    Emergency fund.......................... 0<b>
    Total monthly expenses.................. 1755</b>
    <b>

    Assets</b>
    Cash.................................... 0
    House value (Gross)..................... 0
    Shares and bonds........................ 0
    Car(s).................................. 0
    Other assets............................ 0<b>
    Total Assets............................ 0</b>
    <b>
    No Secured nor Hire Purchase Debts</b>

    <b>Unsecured Debts</b>
    Description....................Debt......Monthly...APR
    Zopa Loan......................1120......59........7.7
    HBSC Loan......................2813......148.......(not sure)
    HSBC Card......................495.......13.......(not sure)
    quickquid......................374.......374.......0
    Wageday advance................272.......272.......0
    Moorcroft debt.................2169......70........(no interest)
    Cabot Financial debt...........853.79....71........(no interest)
    Amigo Loans....................1636......257.......49.9
    HSBC Overdraft.................1000......0........(not sure)
    Total unsecured debts..........10732.79..1264......- </b>

    <b>
    Monthly Budget Summary</b>
    Total monthly income.................... 2,780
    Expenses (including HP & secured debts). 1,755
    Available for debt repayments........... 1,025
    Monthly UNsecured debt repayments....... 1,264<b>
    Amount short for making debt repayments. -239</b>

    <b>Personal Balance Sheet Summary</b>
    Total assets (things you own)........... 0
    Total HP & Secured debt................. -0
    Total Unsecured debt.................... -10,732.79<b>
    Net Assets.............................. -10,732.79</b>
  • MrsSave
    MrsSave Posts: 1,817
    First Anniversary Name Dropper First Post
    Forumite
    You can deal with this. At the moment you are paying over £1200 a month off your debts. If you managed to shift some around (especially the Amigo loan - ouch at that interest rate) to get the interest rates as low as possible you could pay this off fairly quickly.

    To start Once you've paid off the wageday advance and quickquid, you'll have an extra £646 to play around with each month. When are you paying them off?

    Point on your soa:
    Groceries is high for just 2 adults,
    Rent is very high if that's just half, though I do understand different prices in different areas - actually just re read your first post and see you're London based but planning on moving back with parents to save a deposit. Can you do that sooner to pay off the debts initially? They'd be gone in no time with you then,
    Mobile phone is high,
    At the moment you could probably do without spending £50 a month on clothes, especially as there are no children,
    Do you never buy a Christmas or birthday present?
    You do need to build an emergency fund,

    Are the debts just yours, or did you build them up with your wife? How are you planning to move forwards with budgeting?

    This is fixable. Talk to your wife so she understand the full extent and work out your plan.
    Starting a new debt free journey
    Starting Debt: £5,250
    Current Debt: £4,995.50
    Amount Paid: £254.50 Percentage Paid: 4.84%
    Emergency Fund: £350
  • Dobbibill
    Dobbibill Posts: 4,133
    First Anniversary Mortgage-free Glee! Name Dropper First Post
    Ambassador
    Richiered wrote: »
    Hi All,

    Sorry for not getting this up sooner.

    So what is it telling me?? is my situation bad?

    Am I going to make it to that mortgage application in 2020?<pre><b>Statement of Affairs and Personal Balance Sheet</b><b>

    Household Information</b>
    Number of adults in household........... 2 (Not included wife's income but halved rent, I pay all bills due to significantly higher salary)
    Number of children in household......... 0
    Number of cars owned.................... 0<b>

    Monthly Income Details</b>
    Monthly income after tax................ 2780
    Partners monthly income after tax....... 0
    Benefits................................ 0
    Other income............................ 0<b>
    Total monthly income.................... 2780</b><b>

    Monthly Expense Details</b>
    Mortgage................................ 0
    Secured/HP loan repayments.............. 0
    Rent.................................... 750
    Management charge (leasehold property).. 0
    Council tax............................. 131 Is this over 10 months, if so change it to 12 it will free up a further £20+ monthly
    Electricity............................. 22
    Gas..................................... 23
    Oil..................................... 0
    Water rates............................. 30
    Telephone (land line)................... 0
    Mobile phone............................ 45 This is expensive, can you reduce this - SIMO is under £10
    TV Licence.............................. 12
    Satellite/Cable TV...................... 0
    Internet Services....................... 29
    Groceries etc. ......................... 300 You should be able to shave a fair amount off this, change brand, store, meal plan
    Clothing................................ 50 ditch this for the moment
    Petrol/diesel........................... 0
    Road tax................................ 0
    Car Insurance........................... 0
    Car maintenance (including MOT)......... 0
    Car parking............................. 0
    Other travel............................ 128
    Childcare/nursery....................... 0
    Other child related expenses............ 0
    Medical (prescriptions, dentist etc).... 0
    Pet insurance/vet bills................. 0
    Buildings insurance..................... 0
    Contents insurance...................... 19 when this is due for renewal use sites like Quidco or TCB to save money
    Life assurance ......................... 0
    Other insurance......................... 0
    Presents (birthday, christmas etc)...... 0 do you really never buy anyone a present EVER?
    Haircuts................................ 16 go an extra week or so between haircuts, use a local college, student will be very well supervised and it will cost you a fraction of the price
    Entertainment........................... 200 You need to reduce this at the moment
    Holiday................................. 0
    Emergency fund.......................... 0<b> You should be putting something in here
    Total monthly expenses.................. 1755</b>
    <b>

    Assets</b>
    Cash.................................... 0
    House value (Gross)..................... 0
    Shares and bonds........................ 0
    Car(s).................................. 0
    Other assets............................ 0<b>
    Total Assets............................ 0</b>
    <b>
    No Secured nor Hire Purchase Debts</b>

    <b>Unsecured Debts</b>
    Description....................Debt......Monthly...APR
    Zopa Loan......................1120......59........7.7
    HBSC Loan......................2813......148.......(not sure)
    HSBC Card......................495.......13.......(not sure)
    quickquid......................374.......374.......0
    Wageday advance................272.......272.......0
    Moorcroft debt.................2169......70........(no interest)
    Cabot Financial debt...........853.79....71........(no interest)
    Amigo Loans....................1636......257.......49.9 this is a horrendous APR and needs to be a priority
    HSBC Overdraft.................1000......0........(not sure)
    Total unsecured debts..........10732.79..1264......- </b>

    <b>
    Monthly Budget Summary</b>
    Total monthly income.................... 2,780
    Expenses (including HP & secured debts). 1,755
    Available for debt repayments........... 1,025
    Monthly UNsecured debt repayments....... 1,264<b>
    Amount short for making debt repayments. -239</b>

    <b>Personal Balance Sheet Summary</b>
    Total assets (things you own)........... 0
    Total HP & Secured debt................. -0
    Total Unsecured debt.................... -10,732.79<b>
    Net Assets.............................. -10,732.79</b>


    Hi Welcome to the forum.

    I've added some comments in red for you to consider. You need to find the APR on the other debts to really give you a good idea of your plan of action.

    With a few tweaks to your SOA, you can free up additional funds to throw towards the debt.

    Speak to your OH - you need to be honest, you may be surprised at the support they provide. It will be easier if they are aware and on board with your plans.

    All the best.
    I’m a Forum Ambassador and I support the Forum Team on the Budgeting & Bank Accounts, Credit Cards, Credit File & Ratings and Energy boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.

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