Please help

Helpus_3

Please can someone help me, I can't cope with the stress of all this.
We spoke to CCCS today who worked our debt out at 38k and told us it will take 58 years to pay off as we will only have £58 a month to offer to creditors, I just can't see a way out.
We have obviosly spent way more than we have and we also have another property which is up for rent at the minute but we have had 1 out of the 2 houses empty for the last year and have still been paying the £500 a month mortgage hence the 38k.
The other house only has about 10k equity in it, and we had it up for sale and no one wanted it so we have had to put it back up to rent. If we sell this, after fees etc there wouldn't be anything left, but we would have less stress I guess. That house is on a standard interest only mortgage at the mo and the one we are living in is a BTL as we haven't changed the mortgages over.
Our mortgage on this house is £530 a month and we have about 30k maybe more equity in this one, but really don't want to sell it as we need a house at least this size with our 2 young children.
We didn't realise the amount of debt we were in until today, we thought it was around 25k (Heads in sand) What can we do? I just don't know where to turn. I thought we would feel better after speaking to cccs today but instead feel worse. All they seem to have done is tell us how bad it is and give us no way out. They want me to work more hours which is fair enough as I only do 8 a week, but its hard to see when I can do them as I am home with the children all day and neither families are willing to help out with child care. I work evenings, but I can't imagine life where my other half is out all day and me every evening its just not fair on the kids, but I know we have to do something, my stomach is in knots. I am so scared of losing everything. There are a couple of things we can cut back on but can only really save about £40 a month from what we spend now and its just not enough.
Please tell me there is a way out over a reasonable amount of time and I won't lose everthing?

Merlot

Welcome to the board, without an SOA (incomings and outgoings) I can't tell you offhand if there is a quicker way to repay your debts.

First and foremost you contacted one of the best, CCCS are fantastic. Your priority debts are the mortgages, ulitity bills, council tax bills and any secured borrowings, everyone will have to wait, send a letter explaining your situation and offer them a £1 token payment, there is no magic wand to wave to get rid of your debts, but we are here to help you. Post an SOA and you'll get loads of advice.

Merlot.x.

Merlot

Martin Lewis has personally said to a poster on this board, "He has never known a debt problem which couldn't be solved, you need to take the emotion out of it" and that's were we can help.

Merlotx.

chevalier

First thing to say is DON'T PANIC. Panicking can make you make bad decisions that you will not only regret later, but may cost you thousands of pounds too.

However as Merlot says you can do some things to take back control. And doing the letters saying you are going onto a DMP and here is a £1 whilst we are sorting out is one thing.

I am a bit unclear about how many houses you have? Perhaps when doing a statement of affairs, you could also put in an explanation about this?

good luck
chev

Helpus_3

Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Monthly income after tax................ 200
Partners monthly income after tax....... 1430
Benefits................................ 125.4
Other income............................ 495
Total monthly income.................... 2250.4

Monthly Expense Details
Mortgage................................ 530
Secured loan repayments................. 0
Rent.................................... 0
Management charge (leasehold property).. 22
Council tax............................. 92
Electricity............................. 137
Gas..................................... 0
Oil..................................... 0
Water rates............................. 25
Telephone (land line)................... 16
Mobile phone............................ 25
TV Licence.............................. 12
Satellite/Cable TV...................... 21
Internet Services....................... 5
Groceries etc. ......................... 400
Clothing................................ 50
Petrol/diesel........................... 150
Road tax................................ 15
Car Insurance........................... 38.88
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 20
Medical (prescriptions, dentist etc).... 10
Pet insurance/vet bills................. 15
Buildings insurance..................... 22.62
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 25
Haircuts................................ 20
Entertainment........................... 30
Holiday................................. 20
Emergency fund.......................... 0
Total monthly expenses.................. 1721.5

Assets
Cash.................................... 0
House value (Gross)..................... 140000
Shares and bonds........................ 0
Car(s).................................. 3000
Other assets............................ 0
Total Assets............................ 143000

Secured Debts
Description....................Debt......Monthly...APR
Mortgage...................... 97000....(530)......0
Total secured debts........... 97000.....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
egg............................13615.....243.......0
Lloyds TSB.....................979.......20........0
Virgin.........................15403.....273.......0
Natwest OD.....................1090......20........0
Alliance loan..................6500......155.......0
Virgin.........................1847......30........0
Total unsecured debts..........39434.....741.......-

Monthly Budget Summary
Total monthly income.................... 2,250.4
Expenses (including secured debts)....... 1,721.5
Available for debt repayments........... 528.9
Monthly UNsecured debt repayments....... 741
Surplus(deficit if negative)............ -212.1

Personal Balance Sheet Summary
Total assets (things you own)........... 143,000
Total Secured debt...................... -97,000
Total Unsecured debt.................... -39,434
Net Assets.............................. 6,566

Created using the SOA calculator at https://www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission.There is me, other half and 2 children, we have 2 houses which was the biggest mistake of my life as basically this is why we have ended up in a mess, well combined with stupid purchases.We bought the house we were in now and rented it, we then moved from our old house last november and have had no one in there since. There was no one in this house from March to November either due to the state the tenents left it in. It has took a long time to make habitable again.Does this help?

Helpus_3

Actually thats still not right as we have a £93,000 mortgage on the other house and its worth about £100,000 to £110,000

Merlot

Can you update your SOA and add in the second mortgage and the council tax and ulilty bills for it please.

If you press the edit button under your SOA post, then you can add in the details of the second mortgage.

Helpus_3

We have got someone who is supposed to be renting it within the next 2 - 3 weeks hopefully which would cover the mortgage, council tax etc

rayday2

Sorry its not clear from your first post are the CCCS willing to help you still or is just the 58 years that is playing on your mind?

msmicawber

Hi and welcome. While you're updating your SOA, I'll comment on what's there already:
Electricity - that's very high. Are you paying back debt? If not, there's lots you can do to reduce usage. Consider switching supplier.
Mobile phone - a little high. Can you move to PAYG?
Groceries - eek! for 2 adults and 2 children, you could halve that easily. See the Old Style board for tips & recipes.
Petrol/diesel - high again. Can you combine journeys or do anything else to reduce this?
Haircuts - £240pa is very high for 4 people. Could easily reduce this.
Entertainment - this is too high in your current circumstances. Look for cheap/free alternatives.
Holiday - would recommend waiting until debts are sorted before having a holiday.

Is the 'other income' the rent from your second property?

I hope that helps a little. I can see lots of scope for reducing your expenditure.

Merlot

Helpus wrote: »

Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Monthly income after tax................ 200
Partners monthly income after tax....... 1430
Benefits................................ 125.4
Other income............................ 495 - What's this?
Total monthly income.................... 2250.4

Monthly Expense Details
Mortgage................................ 530 - can you change to interest only for a while, take a look at a mortgage calculator on the web and it will tell you the difference to the monthly payments - Interest only/repayment
Secured loan repayments................. 0
Rent.................................... 0
Management charge (leasehold property).. 22
Council tax............................. 92
Electricity............................. 137 Gosh thats high, you need to look into this
Gas..................................... 0
Oil..................................... 0
Water rates............................. 25
Telephone (land line)................... 16
Mobile phone............................ 25 - mmm. you can't really afford this.
TV Licence.............................. 12
Satellite/Cable TV...................... 21 Got to go
Internet Services....................... 5
Groceries etc. ......................... 400 This is high, you can reduce this by £100 easily, take a look at Old Style Board or ideas
Clothing................................ 50
Petrol/diesel........................... 150
Road tax................................ 15
Car Insurance........................... 38.88
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 20 Whats this
Medical (prescriptions, dentist etc).... 10
Pet insurance/vet bills................. 15
Buildings insurance..................... 22.62
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 25
Haircuts................................ 20
Entertainment........................... 30
Holiday................................. 20 - You can't afford this
Emergency fund.......................... 0
Total monthly expenses.................. 1721.5

Assets
Cash.................................... 0
House value (Gross)..................... 140000
Shares and bonds........................ 0
Car(s).................................. 3000
Other assets............................ 0
Total Assets............................ 143000

Secured Debts
Description....................Debt......Monthly...APR
Mortgage...................... 97000....(530)......0
Total secured debts........... 97000.....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
egg............................13615.....243.......0
Lloyds TSB.....................979.......20........0
Virgin.........................15403.....273.......0
Natwest OD.....................1090......20........0
Alliance loan..................6500......155.......0
Virgin.........................1847......30........0
Total unsecured debts..........39434.....741.......-

Monthly Budget Summary
Total monthly income.................... 2,250.4
Expenses (including secured debts)....... 1,721.5
Available for debt repayments........... 528.9
Monthly UNsecured debt repayments....... 741
Surplus(deficit if negative)............ -212.1

Personal Balance Sheet Summary
Total assets (things you own)........... 143,000
Total Secured debt...................... -97,000
Total Unsecured debt.................... -39,434
Net Assets.............................. 6,566

Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission.There is me, other half and 2 children, we have 2 houses which was the biggest mistake of my life as basically this is why we have ended up in a mess, well combined with stupid purchases.We bought the house we were in now and rented it, we then moved from our old house last november and have had no one in there since. There was no one in this house from March to November either due to the state the tenents left it in. It has took a long time to make habitable again.Does this help?

Thank you for posting your SOA. I have added comments in above, but I am confused, what is the extra income above £400+ and why haven't you put in your second mortgage, the property is not let out yet and you must be paying the mortgage on it just now.

Merlot.x.