Debt out of control - please help

beyondhelp_2

Where do I start... Well about 4 years ago we were quite comfortable - had a £43k mortgage on a 3 bed end-terrace and NO DEBT. Then I fell pregnant with my 3rd child and my husband got it into his head that we needed a bigger house. I just went along with it because the houses he was looking at were £160k minimum and I didn't think we'd ever get the mortage we needed (he was on about £20k basic plus £10k commission and I wasn't working).

WRONG - WE GOT A MORTGAGE FOR £125K which we couldn't afford...

Hubby persuaded me that we'd manage as he would stop smoking and drinking which would save about £300 per month, and although tight we'd be ok.

I knew deep-down we wouldn't be ok but let him talk me in to it... Big mistake!

Guess what - he never stopped smoking or drinking and probably never will.

We had £6k credit card debt within a year. We took out a loan to pay this off but before we knew it we had the loan and another £8k on the credit card too!

HUBBY REMORTGAGED FOR £140k to pay off debts, assuring me this was the cheapest way to do it. (Knew this wouldn't help as we couldn't afford the £125k mortgage in the first place!!! - Didn't know what else to suggest). He also once again promised to stop smoking and drinking...

Credit card ended up with another £14k on it... Took out a £14k loan to pay it off.

Hubby got me a car for Xmas - lovely present - but another loan for £9k!!! He's mad - but his attitude is "don't worry about it"!!!! I did need a new car as mine was starting to cost us more money than it was worth - and he always convinces me it'll be ok!!!

So - we've now got:

£140k MORTGAGE
£12k LOAN (was £14k but £2k paid off)
£9k CAR LOAN
£8k CREDIT CARD DEBT

I have told my husband we need to sell the house and pay off all the debt and start again but he refuses and says we'd never get to the stage where we could afford a nice house again and we'd need at least 3 bedrooms (we've got 4 now) which would cost us £140k minimum anyway...

He is now suggesting that we take out a £173k INTEREST ONLY MORTGAGE... I don't think anyone will lend us this kind of money - but you never know. The idea being that all our debts will be paid off and our mortgage payment will come down as it's interest only so we should have enough to live off... But what worries me is when are we every going to have any money to pay off the capital?

I don't know what to do. I want to phone someone for advise but hubby doesn't want me to. We have an excellent credit rating and he doesn't want me to jeopordise that.

I now work from home when my little boy is at Playgroup - and work 2 evenings a week and all day Saturday - as well as being full-time mum to 3 kids. I sometimes wonder why I'm killing myself when he still can't get it in to his head that we can't go on living like this.

His answer is always that everyone lives on credit cards nowadays and that I shouldn't worry about it... Well I am more than worried because each year we just seem to accumulate more and more...

I love my husband very much but just can't cope with this debt... I never had any financial problems before and just haven't been brought up like this. It's got to the point now where I wonder if the only option is to leave and make him sell the house... which with 3 children I really don't want to do but at least I'd be in control of my money if I went it alone...

By the way - he's still smoking and drinking which is really getting to me now as he's promised me time and again that he's stop.

vodkaqueen75

Hi, have you sat down with your husband and explained all this too him?

my husband did this to me and i realised that i was being extremley selfish spending £30 a week on cigarettes, its now been 4 months since i gave up and we really notice the difference financially.

Hopefully someone will be along soon with more advice for you with regards to the debts.

I have 3 children too and know how hard it is ((hugs))

xx

Bestthingsinlifearefree

HI Beyondhelp,

welcome to MSE. You have come to the right place for support and help.

You have had your "lightbulb" moment. The key is how to get your hubby to have his light bulb moment.

You need to post a complete statement of affairs here ie all ingoings /outgoings. Then members can advise you.

Maybe you can get your husband to read these forum with you.

It seems he is in denial / does not want to face up to things.

I am sure you two as one team, together can get through this.He needs to realise the house is on the line and so is his families financial security.

Maybe the drink / the fags etc are part of the denial and yes they will have to go / cut down on.

He need to realise borrowing more and more is NOT the solution living within your means / income is.

I wish you well. Keep positive.

KatrinaC_2

beyondhelp wrote:

So - we've now got:

£140k MORTGAGE
£12k LOAN (was £14k but £2k paid off)
£9k CAR LOAN
£8k CREDIT CARD DEBT

I have told my husband we need to sell the house and pay off all the debt and start again but he refuses and says we'd never get to the stage where we could afford a nice house again and we'd need at least 3 bedrooms (we've got 4 now) which would cost us £140k minimum anyway...

He is now suggesting that we take out a £173k INTEREST ONLY MORTGAGE... I don't think anyone will lend us this kind of money - but you never know. The idea being that all our debts will be paid off and our mortgage payment will come down as it's interest only so we should have enough to live off... But what worries me is when are we every going to have any money to pay off the capital?

I don't know what to do. I want to phone someone for advise but hubby doesn't want me to. We have an excellent credit rating and he doesn't want me to jeopordise that.

I now work from home when my little boy is at Playgroup - and work 2 evenings a week and all day Saturday - as well as being full-time mum to 3 kids. I sometimes wonder why I'm killing myself when he still can't get it in to his head that we can't go on living like this.

His answer is always that everyone lives on credit cards nowadays and that I shouldn't worry about it... Well I am more than worried because each year we just seem to accumulate more and more...

I love my husband very much but just can't cope with this debt... I never had any financial problems before and just haven't been brought up like this. It's got to the point now where I wonder if the only option is to leave and make him sell the house... which with 3 children I really don't want to do but at least I'd be in control of my money if I went it alone...

By the way - he's still smoking and drinking which is really getting to me now as he's promised me time and again that he's stop.

The first thing you need to do - before looking for more credit or ways to cut back - is to sit down and talk to your husband. I know you already have, but there is no point in trying to save money if he's just going to spend it. Before you talk to him, work out:
what you want to say
what the problems are (and illustrate with figures)
what you think is the best way forward
what you want him to do
what you will do
what the consequences are (bankruptcy, reposession of your home, you leaving him...) if you cannot clear some of the debts or make the repayments
Once you have done that, ask a neighbour or a grandparent to look after the kids for an evening or an afternoon and sit down and talk to each other.

In the mean time, you might like to put on here a full statement of affairs - you need to list your incoming money, your outgoings, your debts and the interest rates on them, whether your credit is good enough for you to look at moving card balances about. It sounds like a lot or work (and it's not easy), but it is something you'll need to do before you speak to your husband anyway. Once you'e done that there are a lot of very knowledgeable people on here who will try to find ways for you to save money and lower your debts.

Kat

tattooed_lady

I really sympathise with you, what at awful situation to be in. Don't take this the wrong way, but you really must be firm and insist that you downsize asap as you can't keep plodding away as you are. I know what it's like to live in a small property, I have 3 kids and live in a 2 bedroom flat, but we are realistic and know that this is all we can afford. It's not easy but at least we have a roof over our heads. We also have a old and small car which is a pain but I'm glad that I have wheels of any sort to be honest with you! Please don't be offended but it seems that your OH may think you're a bit of a pushover, you must show him that you mean business this time and he must listen to your concerns as they are very valid. Big hugs to you xx

woohoo_postingid

Get a loan - Pay off CC's
Get a loan - Pay off CC's
Get a loan - Pay off CC's
Get a loan - Pay off CC's
Increase Mortgage - Pay off loan(s)

Until you BOTH realise that you need a complete lifestyle change, nothing is going to change. You may get a new mortgage and pay off some loans and then you will start again and will be back here again in a couple of years. You have done it a few times already and will continue to do so until you BOTH realise that things need to change.

I really hope you can work out what to do, the folks on here are great and will help you out as much as they can, but it is down to you.

Anniek1969

Hi,

I know exactly what you're going through. About 6 years ago myself and my husband both worked full time. We had 2 young daughters and a great credit rating. Mortgage was only £25000 and although we had a bit of debt we were managing really well. Then I decided to change job and it all went wrong from there. The hours I worked meant I wasn't seeing the girls and my husband worked shifts so we had to rely on family to look after the kids. This put a great strain on our relationship and it reached breaking point after christmas when I asked my boss to change my hours so I could see more of my family only to be told he wanted me to increase my hours instead.

We sat down and looked at our finances and decided that if I gave up work and he got rid of his car we would be able to cope, the money the car cost us for insurance, fuel and repayments etc were almost what I was earning and we'd also qualify for tax credits so we would not be that much worse off.

Of course it didn't work out like that because we were seeing more of each other and having more nights out together, spending enourmous amounts of money in the supermarket on food we'd end up throwing out and having takeaways about 3 times a week. Before long it all started catching up on us and we were using the credit card more and more. In the end we ended up with about £20000 of debt that we couldn't repay.

At first I just tried to ignore the debt but it eventually caught up with me, I took advice from the citizens advice bureau and with their help all of my creditors agreed to take smaller payments every month.

We've been on these payments for about 4yrs now and it's slowly getting paid back. We won't be debt free till about 2012 but at least we're getting there.

I've since had another daughter and i'm still a stay at home mum but we're a much happier family now. We don't have the money to spend we used to have but at least we know that one day we'll be debt free.

I only discovered this site about two weeks ago but since then I've been really determined to save as much as possible and stick to a budget and when I look at my debt now I know that It's possible to get out of debt you just need a little help sometimes.

There is a way out but you just have to get your husband to face reality too and I know that might not be easy but maybe if you let him see what your posting here he might realise how upset you are about it.

Hope hearing others stories helps you feel a bit more positive about your situation.

Thefunkygibbons

We need the SOA

but the deal with hubby looks like

Here is a budget
You keep control of all the finances
He gets £5 a week pocket money

That should make him realise that you cannot continue as you are

Volunteer to sell the car so as to illustrate how tight things are

beyondhelp_2

Income

Hubby's Salary 2000.00 (variable - could be £300 less)
My Salary 400.00 (again variable - could be £100 less)
Child Benefit 159.20
Tax Credits 41.96

Total Income 2601.16

Expenses

Loan 1 204.10 (£12318.58 left to pay)
Loan 2 164.49 (£8062.69 left to pay)
Credit Card debt 250.00 (£7909.05 currently owed)
Mortgage 675.56
Endowments 111.00
Life Assurance 33.29
Hubby's Pension 58.38
House Insurance 28.10
Council Tax 120.00
Water Rates 35.00
Electricity 47.50
Gas 30.50
Home Phone 14.50
Broadband 26.98 (can get cheaper but not with parental ctrls)
Mobile Phones 55.99 (for 2 mobiles - £150 cashback coming on each)
Petrol 250.00
Food 450.00 (there are 5 of us and this is for everything!)
Clothing/Shoes 100.00 (again there are 5 of us!)
Ballet Lessons 40.00
Rainbow Guides 10.00
Cigarettes 150.00??? (20+++ a day)
Wine 150.00??? (approx. 2 bottles most days)

Total Expenses 3005.39

Difference -£404.23

And that is a good month when commission is quite high on hubby's salary.

Plus nothing accounted for:

ever leaving the house and taking the kids anywhere...

all the parties they're invited to (presents and cards required constantly)...

hair cuts, dentist appointments, prescriptions...

birthdays (which I dread - especially the kids - because I can't afford anything much for them and as for parties!!!)...

Christmas (I now hate Xmas and it should be special with 3 young kids)...

Holidays (we go to Haven or Butlins paid for with Tesco Clubcard vouchers - but still need some spending money), etc...

Plus I'm bound to have forgotten something - oh yes - car insurance and road tax...

It never ends...

JAMIEDODGER

most obvious suggestions, by tobacco and roll your own and cut back on the drink as you simply cannot afford to drink that much.

there are 5 of us, me and 4 kids and i spend about 30-40 per week on food and we eat really well.

buy your clothes in charity shops or ebay, dont buy unless absolutely necc.

im sure others will be along in a mo to add.


BTW well done for posting, its a huge step to take.

JD xx

climbgirl

Just a few things that immediately jump out - the wine has to go! Or at least be cut right back... sure it's nice to have, but the hard truth is that you just can't afford it right now.

Also the food bills are high, even for 5 people. Get over to the old-style board for ways to cut this right down.

Your gas and electricity seem high too, check to make sure you're with the lowest possible supplier (read Martin's switching article)

One more thing - you need to include EVERYTHING in your budget. And I mean everything. Road tax, car insurance, christmas, birthdays. These are things that people overlook and then say 'unexpected things popped up and blew my budget this month'. These things are not unexpected and you need to account for them, otherwise your budget is doomed to failure.

Good luck with convincing your husband - maybe find a few of the 'horror stories' of bankruptcies etc on here and show him those... Or work out something that you could spend the money on if you didn't have those loan repayments every month...