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  • FIRST POST
    • Emsiecat
    • By Emsiecat 14th Jun 17, 9:02 PM
    • 5Posts
    • 0Thanks
    Emsiecat
    Urgent help
    • #1
    • 14th Jun 17, 9:02 PM
    Urgent help 14th Jun 17 at 9:02 PM
    Hello,

    I'm not sure if this is the right forum to post on, or if I'm even allowed to post this at all, but I was wondering if someone could give me some advice.

    My family and I are facing a very bad financial situation at present.

    I am an adult still living at home with my parents, I work full time but unfortunately do not make enough money to move out or to fully support my family. My younger brother unfortunately cannot work at all.

    My mother works, but until recently the majority of our income was brought in by my father, but he has just lost his job.

    My father has always worked as a delivery driver, and as he has no experience in anything else, at this time of life it is all he can hope to carry on doing, as we have no savings and no time for him to try to retrain in another profession. He has applied for a lot of driver jobs, but none of them offer nearly enough wage-wise (he was earning £10 an hour in his old job and we were barely getting by on that, the highest wage he's been offered so far is £8).

    We have a mortgage we need to pay off and some debts as well.

    My mother said the only solution she can think of is for us to sell our house and buy one a LOT cheaper in order to become mortgage free and pay off all our debts. This seemed like a fair idea until we got our house valued. We had two estate agents come round and they have valued our house a lot less than what we need. In order for our plan to work we would need to buy a house at LEAST £60,000 cheaper than what we sell this one for, and currently in our area there is simply nothing suitable for us. The only houses available anywhere near this price range are either in a state of disrepair that we would not be able to afford to rectify, or they're situated in very bad areas of our city crime-wise.

    It's such a scary situation and we really don't know what to do.

    I was wondering if anyone here had ever been through a similar financial problem, and if selling our house and buying another much cheaper is really the only way we can sort this out?

    Time is of the essence as we have debts, no way to pay the mortgage long term, and no idea if or when my father will ever get a decently paid job. As such we can't really take a mortgage break, and I fear that when push comes to shove we will have to settle for the first affordable house on the market which may be entirely unsuitable for us.

    Many thanks for your time and any advice you can give.
Page 1
    • omelette451
    • By omelette451 14th Jun 17, 9:47 PM
    • 1,873 Posts
    • 1,188 Thanks
    omelette451
    • #2
    • 14th Jun 17, 9:47 PM
    • #2
    • 14th Jun 17, 9:47 PM
    Take the best-paying job he can get - £8 may be less than he's used to but it's an awful lot better than £0. Then keep looking for a better one, it will happen. Economise and 'downsize' as much as possible - MSE is full of helpful tips for this and everyone can find something. For example I saved 20% on food bills recently by having some meat-free days each week (eggs and seasonal veg were fantastic value).
    Why can't your brother work? Even a day a week would help (assuming he's old enough). Desperate times and all that...

    In short, set yourselves up to keep going on whatever you can in the short term, hopefully something will work out. Then reassess the house and what you need to do with that.
    • ACG
    • By ACG 14th Jun 17, 9:53 PM
    • 15,044 Posts
    • 7,607 Thanks
    ACG
    • #3
    • 14th Jun 17, 9:53 PM
    • #3
    • 14th Jun 17, 9:53 PM
    How much is the house worth?
    How much is the balance?

    Would an equity release mortgage be an option?
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
    • Geoff1963
    • By Geoff1963 14th Jun 17, 10:58 PM
    • 586 Posts
    • 369 Thanks
    Geoff1963
    • #4
    • 14th Jun 17, 10:58 PM
    • #4
    • 14th Jun 17, 10:58 PM
    If your father has the highest earnings rate, could he do more hours ; while everyone else does everything humanly possible, to make the rest of his life easier, and save money on bills ?

    The cost and effort of moving, means that you can't save anything unless the new house is at least maybe £5K cheaper.

    Probably useful to do a spending diary ; then you'll know where the wins are, and it also makes you consider every purchase.
    • Emsiecat
    • By Emsiecat 14th Jun 17, 11:12 PM
    • 5 Posts
    • 0 Thanks
    Emsiecat
    • #5
    • 14th Jun 17, 11:12 PM
    • #5
    • 14th Jun 17, 11:12 PM
    Take the best-paying job he can get - £8 may be less than he's used to but it's an awful lot better than £0. Then keep looking for a better one, it will happen. Economise and 'downsize' as much as possible - MSE is full of helpful tips for this and everyone can find something. For example I saved 20% on food bills recently by having some meat-free days each week (eggs and seasonal veg were fantastic value).
    Why can't your brother work? Even a day a week would help (assuming he's old enough). Desperate times and all that...

    In short, set yourselves up to keep going on whatever you can in the short term, hopefully something will work out. Then reassess the house and what you need to do with that.
    Originally posted by omelette451
    Thank you for the reply. We are trying to economise as much as possible, and I will certainly look around the site for tips. My brother can't work as unfortunately he is on incapacity benefits due to a condition and is unable to get a job because of this.

    Thanks again for your help.
    • Emsiecat
    • By Emsiecat 14th Jun 17, 11:17 PM
    • 5 Posts
    • 0 Thanks
    Emsiecat
    • #6
    • 14th Jun 17, 11:17 PM
    • #6
    • 14th Jun 17, 11:17 PM
    How much is the house worth?
    How much is the balance?

    Would an equity release mortgage be an option?
    Originally posted by ACG
    According to the estate agents they valued the house at £300,000 and £330,000. We owe £53,000 on our mortgage and would need a house at least £60,000 cheaper than our selling price in order to balance everything and clear the mortgage. This sounds like quite a lot, but in the area I live in a house of around £240,000 or less is usually in a bad crime area, and/or needs a lot of work doing to it which we wouldn't be able to afford.

    We haven't yet looked into equity release mortgages as we have heard they are a bit 'dodgy' to deal with and could lead to more problems, but it might be worth looking into it further.

    Thanks for the reply.
    • Emsiecat
    • By Emsiecat 14th Jun 17, 11:22 PM
    • 5 Posts
    • 0 Thanks
    Emsiecat
    • #7
    • 14th Jun 17, 11:22 PM
    • #7
    • 14th Jun 17, 11:22 PM
    If your father has the highest earnings rate, could he do more hours ; while everyone else does everything humanly possible, to make the rest of his life easier, and save money on bills ?

    The cost and effort of moving, means that you can't save anything unless the new house is at least maybe £5K cheaper.

    Probably useful to do a spending diary ; then you'll know where the wins are, and it also makes you consider every purchase.
    Originally posted by Geoff1963
    I'm not sure if my father would be able to do more hours or not, it depends if an employer would offer him any, as it is he is looking for full-time work with as many hours a week as possible available.

    We will try to see what we can cut down on, but my mother estimated we would need to save around £150 a week extra if Dad took a lower paid job. We don't really have anything we spend frivolously on; we never go on holidays, don't go to a gym or have expensive hobbies, we very rarely shop for clothes or frivolities, and try to spend as little on groceries as we can. I suppose we could cut down here a bit more by just getting basics and so on, but we don't really indulge on anything. A spending diary would be a good idea though.

    Thank you very much for your reply.
    • kelpie35
    • By kelpie35 14th Jun 17, 11:35 PM
    • 1,438 Posts
    • 4,471 Thanks
    kelpie35
    • #8
    • 14th Jun 17, 11:35 PM
    • #8
    • 14th Jun 17, 11:35 PM
    Can your mother not get a job?

    Your father would be better off taking a job at £8 an hr immediately, and still keep looking in the future for a better paid job.

    Have you and your family considered relocating to a cheaper part of the country?
    • Emsiecat
    • By Emsiecat 15th Jun 17, 12:11 AM
    • 5 Posts
    • 0 Thanks
    Emsiecat
    • #9
    • 15th Jun 17, 12:11 AM
    • #9
    • 15th Jun 17, 12:11 AM
    Can your mother not get a job?

    Your father would be better off taking a job at £8 an hr immediately, and still keep looking in the future for a better paid job.

    Have you and your family considered relocating to a cheaper part of the country?
    Originally posted by kelpie35
    My mother does work, but there's only so many hours she can work due to needing to be around for various family members, but it is a possibility she could get a better paid/ full time job even if just short-term. I know she has taken extra hours in her current job wherever possible.

    We did look into relocating, it would be ideal really as you can get some really lovely houses in nice places for this price in other parts of the country. At the moment though it isn't possible due to needing to be in the area for elderly grandparents and also the uncertainty we would have of all finding jobs in the new location, though hopefully that uncertainty regarding jobs wouldn't be an issue for too long. Again, if it came to it I would quite like to relocate, but at this moment in time it would be difficult but if circumstances change then it might be something we can consider in the future.

    Thanks for replying.
    Last edited by Emsiecat; 15-06-2017 at 1:20 AM.
    • ACG
    • By ACG 15th Jun 17, 10:05 AM
    • 15,044 Posts
    • 7,607 Thanks
    ACG
    Equity release was a bit dodgy, but it is regulated now so providing you go down a regulated route you should be fine.

    It might not be the answer but it won't hurt to look in to.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
    • clairebeth
    • By clairebeth 16th Jun 17, 12:59 PM
    • 99 Posts
    • 26 Thanks
    clairebeth
    I think it would be wise too for you and your parents to post on the Debt Free Wannabe forum. You could post a statement of affairs and people can give you advice on your debts. If you can get them a bit more sorted and your head a bit clearer before perhaps doing the equity release , that might be a good idea?
    • Spangled
    • By Spangled 16th Jun 17, 1:38 PM
    • 172 Posts
    • 69 Thanks
    Spangled
    If you mortgage is just £53k (which in the general scheme of things is pretty low) and yet you're struggling to meet your monthly payments, does this mean you're on a high mortgage rate? Are you stuck on your lender's (high) standard variable rate? Could you get a product switch with your lender to go onto a more favourable rate? You can generally switch to a new rate with your current lender with no additional checks on your income.
    • waveneygnome
    • By waveneygnome 16th Jun 17, 10:06 PM
    • 203 Posts
    • 130 Thanks
    waveneygnome
    If Dad did earn £10 per hour = say £20k pa
    Mum earns say £8 per hour, half the time = £8k pa
    You earn min wage, full time = £13k
    Thats £41k per year
    (ignoring Brothers contribution/benefits)

    If Dad earnt £8 per hour in new job = say £16k pa
    Mum earns say £8 per hour, half the time = £8k pa
    You earn min wage, full time = £13k
    Thats £37k per year (4k less than before/£80 per week)
    (ignoring Brothers contribution/benefits)

    If your mortgage is £53k....you should easily be able to survive on the new lower income.

    You need to pull together as a household - put together a Statement of Affairs, visit the Debt Free Board. Don't despair, you just need to be ruthless with your spending & focus more.
    • smem18
    • By smem18 20th Jun 17, 5:20 PM
    • 27 Posts
    • 8 Thanks
    smem18
    Have you phoned your mortgage lender to explain your situation? I don't know if it would help but maybe they could switch you onto a better interest rate so that you are paying less per month or put you onto some sort of temporary payment plan? Before you get yourself in trouble or consider selling your house, maybe this is worth a try?
    • davgray
    • By davgray 20th Jun 17, 9:01 PM
    • 6 Posts
    • 5 Thanks
    davgray
    To be honest and going back to previous posters, that amount of mortgage isn't very large, but obviously don't know what your other debts mount up to be. Not sure what your household income is between everyone, but as mentioned if it's anywhere over 40k if your dad takes a lower paid job I would think you should be fine. I have double that mortgage and on 43k and don't have issues. However if you did need to move don't automatically write off areas you hear are bad etc, a lot of it can be rubbish and does depend on neighbours and can be different from street to street, no different than spending half a million pounds on a house and having nightmare neighbours. A lot of people fall into the trap of so called good areas and trapping themselves in life long debt, new build estates come to mind!
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