Mortgage,credit card cant afford to pay both

DJP_2

I am in a situation where my hours at work have dropped because of a downturn in work , consequently i can not afford to pay my mortgage (£838 per month) and my credit card ( with a balance of £7550 & min payment of £155 per month) , i have contacted our mortgage people who happen to be Northern Rock to enquire about a 'holiday period' which i was told i am eligable for a 2 month break after November. The problem is even with the 2 months money (£1600 or so) i would have to pay towards the credit card it would'nt bring the minimum payment down anywhere near enough to an affordable level.

Would the best course of action be to plead to Northern Rock and try to get more than a 2 month holiday period or to ring the credit card people and basically tell them i can't pay the minimum amount anymore ?

Many thanks in advance.

RAS

Hi

Please contac tone of the debt charities.

http://www.moneysavingexpert.com/loans/debt-help-plan#help

If the nmortgage is repayment, can you go interest only for a while?

You absolute priority is the mortage. You need to pay that even if you cannot pay the credit card.

There are ways to raise extra money towards the credit card but you really need to talk to the debt charity first and then come back here for more help.

if you do a SOA, we can help you more effectively.

DJP_2

Thankyou for your help

GettingThingsDone

Hi DJP - Ditto what RAS says. If you pop up your SOA there may be ways of spending less (even if it is for a few months) that could help you stretch your money further.

There's no harm (usually) in asking - I think lenders have to be a bit nicer after the 17th November (although I might be wrong with that date).

Just a few suggestions (you've probably been thinking of yourself!)...

Do you have anything you could sell/ebay to raise some cash? Can you move any of your credit card balance to lower interest card?

Have you any charges for late payment (especially greater than £12) on your card from over the last 6 years - you should be able to get these back (especially the part over £12)

As your hours have dropped, can you squeeze in another job?

Good luck and keep posting!

gtd

halight

Hi whaterver you do.Dont fall behind with your morgage. Thats a lot more inportan that the CC . I would phone up the CC company and tell them that you can no loger afford to pay ask them to set up a payment plan with you and ske them to freeze the intrest on the card for the next 6 months. To set up a repayment plan you will need to work out what you can aford to pay them.
Tell them what you can afford and thay should accept this. But thay will try and get you to pay more!!! You will need to stick to your Guns over this.

When you ahve set this all up. Make sure that you dont miss any payments. If you do your payment plan will end and thay wont be willing to give you another go.
If thay freeze the intrest for you after the 6 months is up you will need to phone them again and ask for it to be frozen again.

Good luck

milliemonster

To be honest, I wouldn't take a payment holiday in your situation as your resulting mortgage when you come to start repaying will go up because of the interes that still accrues during the holiday period and this could outweigh any benefit for the reduced min payment on the CC, you need to work out what you can afford to be paying towards your CC and offer your creditors that and explain that your salary is going down and this is all you can afford at the moment

Deep_In_Debt

Yep, I would say your mortgage is more important. Get in touch with your credit card companies and explain your situation and see if you can arrange some sort of payment plan with them - there is a standard letter on the National Debtline website that you can use to write to your credit card companies offering them a pro-rated payment.

cat4772

DJP - can't say anything that hasn't been said before but I'll repeat it:D

Your priority IS your mortgage.
Talk to the credit card company about them possibly reducing the interest rate for a few months, if not talk to the debt free charities for advice (CCCS, national debtline and CAB).
Post up your SOA. I thought my first SOA was fairly tight, but the good folk here managed to find me over £300 a month that we just frittered away. The biggest saving area was grocery shopping. We were spending over £100 a week on food including take aways and probably wasting about £50 of it!

Good luck.

Cat.x

DJP_2

milliemonster wrote: »

To be honest, I wouldn't take a payment holiday in your situation as your resulting mortgage when you come to start repaying will go up because of the interes that still accrues during the holiday period and this could outweigh any benefit for the reduced min payment on the CC, you need to work out what you can afford to be paying towards your CC and offer your creditors that and explain that your salary is going down and this is all you can afford at the moment

Thanks for pointing that out , i've actually arranged a 2 month payment holiday before coming back on here to read this , but just rang my mortgage provider to ask about any increase and was told there would be no increase as we are on a fixed rate and repayments would continue as normal.

Regards

DJP_2

halight wrote: »

Hi whaterver you do.Dont fall behind with your morgage. Thats a lot more inportan that the CC . I would phone up the CC company and tell them that you can no loger afford to pay ask them to set up a payment plan with you and ske them to freeze the intrest on the card for the next 6 months. To set up a repayment plan you will need to work out what you can aford to pay them.
Tell them what you can afford and thay should accept this. But thay will try and get you to pay more!!! You will need to stick to your Guns over this.

When you ahve set this all up. Make sure that you dont miss any payments. If you do your payment plan will end and thay wont be willing to give you another go.
If thay freeze the intrest for you after the 6 months is up you will need to phone them again and ask for it to be frozen again.

Good luck

Thankyou for this advice i shall be ringing my credit card people today to try and arrange something.

Regards

DJP_2

GettingThingsDone wrote: »

Hi DJP - Ditto what RAS says. If you pop up your SOA there may be ways of spending less (even if it is for a few months) that could help you stretch your money further.

There's no harm (usually) in asking - I think lenders have to be a bit nicer after the 17th November (although I might be wrong with that date).

Just a few suggestions (you've probably been thinking of yourself!)...

Do you have anything you could sell/ebay to raise some cash? Can you move any of your credit card balance to lower interest card?

Have you any charges for late payment (especially greater than £12) on your card from over the last 6 years - you should be able to get these back (especially the part over £12)

As your hours have dropped, can you squeeze in another job?

Good luck and keep posting!

gtd

Hi , we do the odd bits and bobs on ebay and don't really have any late charges to reclaim. I work all different hours in any day so another job would be very difficult to fit in but my brain keeps ticking over hoping a solution will drop in place some time !
I'm going down the route of ringing my credit card people to try and arrange something and will try and put my SOA up on here some time soon.

Kind regards