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Rabbit-in-headlights
Posts: 157 Forumite
Hello, this is my first post although I've been reading a lot of threads here and have been amazed at all the helpful advice and support you guys give :T
My light bulb moment was like waking up from a bad dream! As of now I feel strangely relieved to finally admit I cannot carry on paying my contractual debt repayments any longer. For months now I have been paying for food and housekeeping using a credit card, and I really believed that was ok so long as I could meet the minimum repayments each month. Until I started having to borrow money to even cover the minimum payments. And realised that even paying off nearly £300 per month on one credit card was only reducing the debt by around £40 each month (with no purchases on that card whatsoever!). THAT was the light bulb moment. This had to stop!
But now I'm confused about which route to take. I have got as far as completing the CCCS forms and they have suggested a DMP, which IF the creditors agree to freeze interest will take me 6 years to pay off.
But what if the creditors don't freeze the interest? Can I refuse to complete the DMP if they insist on charging interest? If not, I feel I may never be debt free? But what is the alternative?
Also, I have heard that if I go bankrupt, then after 6 years it is wiped off my credit report, i.e. 6 years from being declared bankrupt? Whereas, if I complete a DMP, I have to wait another 6 years after it's all cleared before my credit report is cleared - that's 12 whole years away!
I know that sounds like I'm more concerned with my own credit record than the creditors I owe money to, but 12 years?!!! :eek:
I am single, over 40 and in full time employment (no kids), so no complications except that I do have a mortgage. Equity max of about £12k at the moment, I am considering whether to try to sell up and use the equity to reduce my debts a little, also I could rent for around £300 /mth less than my mortgage but I'm scared I'll never get back on the property ladder if I jump now
Sorry this is so long winded, but I just can't seem to make a decision on what to do next!
My light bulb moment was like waking up from a bad dream! As of now I feel strangely relieved to finally admit I cannot carry on paying my contractual debt repayments any longer. For months now I have been paying for food and housekeeping using a credit card, and I really believed that was ok so long as I could meet the minimum repayments each month. Until I started having to borrow money to even cover the minimum payments. And realised that even paying off nearly £300 per month on one credit card was only reducing the debt by around £40 each month (with no purchases on that card whatsoever!). THAT was the light bulb moment. This had to stop!
But now I'm confused about which route to take. I have got as far as completing the CCCS forms and they have suggested a DMP, which IF the creditors agree to freeze interest will take me 6 years to pay off.
But what if the creditors don't freeze the interest? Can I refuse to complete the DMP if they insist on charging interest? If not, I feel I may never be debt free? But what is the alternative?
Also, I have heard that if I go bankrupt, then after 6 years it is wiped off my credit report, i.e. 6 years from being declared bankrupt? Whereas, if I complete a DMP, I have to wait another 6 years after it's all cleared before my credit report is cleared - that's 12 whole years away!
I know that sounds like I'm more concerned with my own credit record than the creditors I owe money to, but 12 years?!!! :eek:
I am single, over 40 and in full time employment (no kids), so no complications except that I do have a mortgage. Equity max of about £12k at the moment, I am considering whether to try to sell up and use the equity to reduce my debts a little, also I could rent for around £300 /mth less than my mortgage but I'm scared I'll never get back on the property ladder if I jump now
Sorry this is so long winded, but I just can't seem to make a decision on what to do next!
"Proud to be dealing with my debts" :doh:
DMP Mutual Support Thread member 232:D
LBM July 2008 53k:eek: DMP with CCCS - start Oct08 DFD Sep 2014 - or sooner!!;)
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Comments
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http://www.makesenseofcards.com/soacalc.html
can you post yoru statement of affairs and we will be able to see where we can help?
Prob wouldnt sell at the moment due to falling prices and no buyers unless absolutely necessary. Lets see if we can make you savings without having to get rid of your property.
heading to bed but catch you tomorrow maybeDFW 228 LONG H 68
DFD 2017 :eek:0 -
Welcome to the board RIH, you have taken the first steps to becoming a DFW.
To be able to advise you further, we need to see a full SOA which includes debts, aprs, everything.
How is your credit rating?
Regarding BR, you will end up losing the 12K equity if you go BR, could you sell in this climate? If not, don't panic, we can offer you advice regarding reducing your outgoings.
As Martin Lewis says, "he has never known a debt problem that cannot be solved, you just have to take the emotion out of it" and thats the bit we can do, we can see things from a different angle.
I look forward to seeing your SOA.
Sleep well, you can't do too much tonight.
Merlot.x."Wisdom doesn't automatically come with old age. Nothing does, except wrinkles. It's true, some wines improve with age. But only if the grapes were good in the first place." — Abigail Van Buren0 -
Thank you so much, Angelflower and Merlot, for your kind responses. As requested, here is my SOA:eek:
Statement of Affairs and Personal Balance Sheet
Monthly Income Details
Monthly income after tax................ 2336
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2336
Monthly Expense Details
Mortgage................................ 844
Secured loan repayments................. 21
Rent.................................... 0
Management charge (leasehold property).. 58
Council tax............................. 84
Electricity............................. 89
Gas..................................... 0 (elec only)
Oil..................................... 0
Water rates............................. 45
Telephone (land line)................... 10
Mobile phone............................ 26
TV Licence.............................. 12
Satellite/Cable TV...................... 19
Internet Services....................... 5
Groceries etc. ......................... 144
Clothing................................ 20
Petrol/diesel........................... 60
Road tax................................ 10
Car Insurance........................... 30
Car maintenance (including MOT)......... 10
Car parking............................. 0
Other travel............................ 6
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 20
Pet insurance/vet bills................. 0
Buildings insurance..................... 0 (included in monthly mgmt fees)
Contents insurance...................... 16
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 10
Haircuts................................ 10
Entertainment........................... 20
Holiday................................. 0
Emergency fund.......................... 25
Charity................................. 10
Total monthly expenses.................. 1604
Assets
Cash.................................... 0
House value (Gross)..................... 120000
Shares and bonds........................ 100
Car(s).................................. 1000
Other assets............................ 0
Total Assets............................ 121100
Secured Debts
Description....................Debt......Monthly...APR
Mortgage...................... 103000...(844)......6.9
Secured Debt.................. 4000.....(21).......7.4
Total secured debts........... 107000....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
AA Loan........................8834......132.......6.9
A&L Loan.......................8051......322.......6.9
M&S Loan.......................7600......197.......7.4
M&S CCard......................7600......197.......7.4
Citibank CCard.................4460......136.......16.9
A&L CCard......................10853.....275.......16.9
AA CCard.......................6739......135.......16.9
Total unsecured debts..........54137.....1394......-
Monthly Budget Summary
Total monthly income.................... 2,336
Expenses (including secured debts)....... 1,604
Available for debt repayments........... 732
Monthly UNsecured debt repayments....... 1,394
Surplus(deficit if negative)............ -662
Personal Balance Sheet Summary
Total assets (things you own)........... 121,100
Total Secured debt...................... -107,000
Total Unsecured debt.................... -54,137
Net Assets.............................. -40,037
I adult, no children, 1 car
OMG this looks worse n print:o"Proud to be dealing with my debts" :doh:DMP Mutual Support Thread member 232:DLBM July 2008 53k:eek: DMP with CCCS - start Oct08 DFD Sep 2014 - or sooner!!;)0 -
ps my credit rating is fair but have cancelled DD's to regain control and this month paying less than min payments (I have stopped using my ccards completely so have to if I'm going to eat this month). Hoping to get moving with DMP or alternative plan a.s.a.p. before it gets too messy..."Proud to be dealing with my debts" :doh:DMP Mutual Support Thread member 232:DLBM July 2008 53k:eek: DMP with CCCS - start Oct08 DFD Sep 2014 - or sooner!!;)0
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All the best mate, we will be following your progress with interest - keep us all informed.0
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cheers, will do!"Proud to be dealing with my debts" :doh:DMP Mutual Support Thread member 232:DLBM July 2008 53k:eek: DMP with CCCS - start Oct08 DFD Sep 2014 - or sooner!!;)0
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Hi I would look into getting rid of cable TV. I know its only £17 but you could throw that at the card with te highest APR.
The old style board is great for cheap meal ideas, have you thought about trying the store cupboard challenge.
You electricity seems high, make sure nothing is left on standby and switch to energy saving lightbulbs when you can.
Insurance - when they are due check you are on the best dieal by using comparison websites and switch using a cashback site.
Any chance of upping your income or asking your building society for a mortgage holiday?Find out who you are and do that on purpose (thanks to Owain Wyn Jones quoting Dolly Parton)0 -
Rabbit-in-headlights wrote: »Thank you so much, Angelflower and Merlot, for your kind responses. As requested, here is my SOA:eek:
Statement of Affairs and Personal Balance Sheet
Monthly Income Details
Monthly income after tax................ 2336
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2336
Monthly Expense Details
Mortgage................................ 844 what about getting a lodger take some of the burden off the mortagage
Secured loan repayments................. 21
Rent.................................... 0
Management charge (leasehold property).. 58
Council tax............................. 84
Electricity............................. 89
Gas..................................... 0 (elec only)
Oil..................................... 0
Water rates............................. 45
Telephone (land line)................... 10
Mobile phone............................ 26 if this is contract get a payg
TV Licence.............................. 12
Satellite/Cable TV...................... 19
Internet Services....................... 5 if this is from sky downgrade to free broadband i am on that and its free
Groceries etc. ......................... 144
Clothing................................ 20...Dont buy clothes for awhile
Petrol/diesel........................... 60
Road tax................................ 10
Car Insurance........................... 30
Car maintenance (including MOT)......... 10
Car parking............................. 0
Other travel............................ 6
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 20
Pet insurance/vet bills................. 0
Buildings insurance..................... 0 (included in monthly mgmt fees)
Contents insurance...................... 16
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 10 dont buy presents for awhile bake cakes instead
Haircuts................................ 10 dont have an hair cut or try somewhere cheaper do you have it cut every 4 weeks ?
Entertainment........................... 20 cancel this for now
Holiday................................. 0
Emergency fund.......................... 25 reduce this to 10 pounds
Charity................................. 10 charity starts at home :P
Total monthly expenses.................. 1604
Assets
Cash.................................... 0
House value (Gross)..................... 120000
Shares and bonds........................ 100
Car(s).................................. 1000
Other assets............................ 0
Total Assets............................ 121100
Secured Debts
Description....................Debt......Monthly...APR
Mortgage...................... 103000...(844)......6.9
Secured Debt.................. 4000.....(21).......7.4
Total secured debts........... 107000....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
AA Loan........................8834......132.......6.9
A&L Loan.......................8051......322.......6.9
M&S Loan.......................7600......197.......7.4
M&S CCard......................7600......197.......7.4
Citibank CCard.................4460......136.......16.9
A&L CCard......................10853.....275.......16.9
AA CCard.......................6739......135.......16.9
Total unsecured debts..........54137.....1394......-
Monthly Budget Summary
Total monthly income.................... 2,336
Expenses (including secured debts)....... 1,604
Available for debt repayments........... 732
Monthly UNsecured debt repayments....... 1,394
Surplus(deficit if negative)............ -662
Personal Balance Sheet Summary
Total assets (things you own)........... 121,100
Total Secured debt...................... -107,000
Total Unsecured debt.................... -54,137
Net Assets.............................. -40,037
I adult, no children, 1 car
Hope some of my red quotes help, other experts will do better..... :P im just getting the swing of this myself :PThe loans will pay themselves the credit cards need a kicking :money: DFW Long haulers supporter 132!!:T0 -
Thanks for the comments, Tealady and amyandjon, re. the mortgage I will look into whether they will allow a payment holiday although I really just think unless I can find at least £600 a month I won't be able to turn this around without a DMP, the last 2 months even though all my income went to bills and debt payments, I still had to borrow 280 each month just to break even (if adding another £560 to my debts can be described as breakeven!):eek: .
I had a lodger some years ago (a close friend) who ripped me off and ran up heating and phone bills before doing a runner (i.e. not paying up), and I now live in a small flat, so I really don't think I could cope with a lodger again. I really do need my privacy, I don't think that's asking too much.
The mobile is on a contract with another 9 mths to go, will try PAYG after that, the internet has another 10 months to go before I can downgrade. I did save some money by swtching my land-line to Sky, £10/mth includes all my evening and weekend calls, too. I can't cancel the Sky TV without losing the cheap landline and broadband, for another 10 months (still under contract until then). It seems to be catch 22- free TV means more expensive internet and phone calls...and as I don't go away on holidays or go out much, TV and internet are important to me (how could I manage without MSE? lol)
The store cupboard challenge look interesting, I have loads of pasta and rice in my cupboards so that should help a lot! And the cashbacksite idea for insurance looks promising, I didn't know about that! Insurance renewals aren't until next year, though, but I'll keep it in mind.
I'll keep everything else as low as I can, my main worry at the moment is whether the DMP is even accepted by my creditors, as they won't accept an IVA if they won't accept a DMP (100% payback over 6 years vs <100% over 5?), so as far as can see, the only other option begins with the letter B :eek: :eek:
Appreciate everyone's support and suggestions, sorry if any of this sounds negative, I'm trying to stay positive, honestly"Proud to be dealing with my debts" :doh:DMP Mutual Support Thread member 232:DLBM July 2008 53k:eek: DMP with CCCS - start Oct08 DFD Sep 2014 - or sooner!!;)0 -
Hi Don't forget to Amazon/Green Metropolis/ebay and car boot anything that is not nailed down.
Have you any talents you could "sell" eg DIY, cookingFind out who you are and do that on purpose (thanks to Owain Wyn Jones quoting Dolly Parton)0
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