Mortgage payment difficulty advice

incogni2

Monthly repayment: £1,894.11 £2064.78

I will look at this more closely when I can but could you detail the assumption above. I use £1,894.11 because the overpayment is capped at £500 more than the standard payment (according to the current deal).

getmore4less

incogni2 wrote: »

I will look at this more closely when I can but could you detail the assumption above. I use £1,894.11 because the overpayment is capped at £500 more than the standard payment (according to the current deal).

Extend the term payment goes down
Reduce the term payment goes up

You just reduce the term back to 25/24/23/22 years to make the regular payment £500 less than you can afford total.

Watch out for fees, if they let you extend for free make sure you can reduce again for free later.

Remember you need to build up a buffer fund before trying to pay down the debt more quickly.

The alternative way to do the comparison if you cannot overpay the mortgage is to save the differnce in payments, £170.67 so over 170 months thats £29k umm that look to be more than the cost

So, in fact I lose only £25,115.36. However, this loss is again across the entire term which has been reduced to 17.7 years, leaving the monthly loss as approximately £118.25

something is not quite right but you get the idea for a detailed calc.

To make a fair comparison you have to be using the same amount of monthly payments.

incogni2

Mistymaid wrote: »

It doesn't matter what advice you give because the situation is simple.
If the OP went out tomorrow and got a job on 150k a year he would still exceed his earnings - it's his mind-set that's the problem, not his income.

Perhaps - I would like to suggest that my mind-set is not as fixed as you suggest and that it can be restructured depending on circumstances. Any significant debt is a recent phenomenon because, while the CCJ was current, I had no access to credit. I now (personally, not including my wife’s cards, since most of the diatribes here are about me) have 4 cards with a combined limit of £6,100 (just over 50% utilised at £3,097.59, all on a 13 month interest free deal) and a £1300 agreed overdraft at the bank (untouched).

Maybe, if I was on £150K per year, I would find a way to spend it, as you suggest. Personally, I find that spending increases very easily during relatively good times in order to match (or exceed, in my case) income. However, I haven’t found that it slides down as easily as it moved up – there is more inertia.

I’m sorry that what I have written comes across to some as self-pitying whining (as described by a previous poster). I decided when I posted that I wouldn’t try to dress it up into something that it wasn’t in my head. I thought that attempting to be candid was more valuable than pretending to be crushed, desolated, appalled or whatever it is that people would prefer. Yes, I could and perhaps should have moderated my tone (certainly I didn’t intend to sound superior) but I wanted to be honest. Yes, it enabled people to see, and comment upon, what an “!!!!!!” I am but if I could read any of your minds (rather than the filtered, water down version of ourselves we often present to others) what would I think of you? The business of turning thoughts and feelings, attitudes and prejudices into words is a difficult one and I certainly make no claim to be any good at it but I’ve done my best to present reality as it is to me.

getmore4less

incogni2 wrote: »

I thought that attempting to be candid was more valuable than pretending to be crushed, desolated, appalled or whatever it is that people would prefer.

It is important to be open manly for yourself, that way you get other peoples view on thing which allows you challenge your own assumptions.

When income is less than spends it is important to challange everything and repriortise.

When I reviewed ours(not because of debt every one should do it), we made two major changes
1. save more to try and retire earlier
2. diverted expensive meals out/takeaways to another holiday which gave us much better value for money.

Have you done the SOA yet this can be a real eye opener to where your money really goes. most people don't actualy know I suspect you may have a few gaps in what you think you spend to what you actualy spend.

incogni2

PasturesNew wrote: »

So far as I am concerned, their insurances would cover any eventualities.

Do you mean that they insure you against such claims and you know that the cover is sufficient? I am frequently asked to provide a specific level of cover for a particular job, it is in the contract. If I don't pay for that cover then I don't get the work.

For instance, in July 2007, I took employment where the required cover for this risk was £500,000. My standard policy at that time was only £100,000 (though I had raised and lowered it several times previously). 1/2 million cover costs me £400 per year.

incogni2

If you don't succeed on these things, you will lose your house.

This is just too prescriptive – that is, it simply isn’t true. Doing what you suggest will certainly reduce the chances but there are people who have failed to follow either and not lost their house. There are also people who have implemented both and still lost. It is about risk and probability not an absolute perspective – it is neither death nor taxes; it remains uncertain.

Is the post a wind up? Possibly. The OP certainly seems to have moved the goalposts a little throughout.

How so?

But for anybody who spends more than they earn, it is well worth a read.

Read by all means but don’t be seduced into believing in a one true view.

Don't bury your head in the sand.

When it should be in the clouds?

incogni2

Mistymaid wrote: »

How to tell the difference between a man and a boy:-

A boy does what he wants to do.

A man does what he has to do.

And neither does what you tell them to do.

Seriously though, it’s a weak aphorism.

incogni2

So people who are stupid enough to take on an unsustainable level of debt are worthy of love rather than our ire for helping put us in this awful situation we are now in ?

How “unsustainable”? Almost all debt is either sustainable or unsustainable dependent on circumstances. As you suggest earlier, if I got a job stacking shelves or something, it would instantly become sustainable again. All we can state with confidence is that it is unsustainable at this moment (and for the previous three months). Before that it was sustainable. Or is that once something is momentarily unsustainable then it remains so indefinitely? Surely not?

I don’t really feel that I am worthy of either your love or your ire, only your disapprobation. Oh, and I didn’t put you in “this awful situation we are now in”. I’m not like the former head of the RBS or something, you know.

Again had you not been in this position I doubt you would have given two hoots for a debtor.

I’m sorry, is this a value judgement of some kind?

You think you need Broadband to practise what you do. What is that, sitting at home all day.

Well, it certainly does help with the boredom when sitting at home all day, yes.

You have not worked in ages.

Just to clarify, it has been 3 months. The middle ages lasted for roughly a millennium. Let’s hope that my period of unemployment doesn’t begin to rival that, eh?

Clown.

And in the circus of the Internet, you are what? The ringmaster?

No, just another troll.

silvercar

I've just read this whole thread and things really don't add up.

Working in IT on contract work should pay loads more than 15k. Anyone seriously earning 15k would work through personal contracts or an umbrella company, not their own limited company. Apart from a better tax treatment, the point of umbrella companies is allow invoicing for contract work.

I have friends in the IT industry, earning decent money, some have found that they need to put more effort into dove-tailing contracts, others have decided that they are prepared to travel that bit further to ensure contracts on decent money. They all invest time and money in ensuring that their skills are kept upto date. AFAIK none of them have been without work for more than 2 weeks.

You either need to get professional career advice from people within your line of work or to rethink your career.

If you have seriously been earning the max you can with the skills you have, you could have a far less stressful life stacking shelves in Tesco.

gemini24

I applaud incogni2's optimism and never cease to be amazed at how many other borrowers in such a predicament have the same thoughts when it comes to services/possessions they cannot live without.

I earn my living by representing lenders at court to obtain possession orders against borrowers in arrears. Without people like incogni2, I may not be able to meet my own outgoings but there doesn't appear to be much of a shortage of work currently!

Borrowers prepared to do whatever it takes to keep their homes mostly keep them, those that won't, don't.

I would add I have attended court numerous times to be informed the borrowers would not be in attendance as they were on holiday. Says it all I guess.