Help!! Mature Student's SOA

Bicks

Hello to you all,

I'm 26 years old, married to OH, 32yrs, and in 2007 lost my job and so decided to follow my dream. My OH and I sold our house in the city, cleared our (copious) debts and backpacked round the world together for 9 months with the money leftover. Arrived back in blighty after the most amazing experience to find I had been accepted on an NHS funded course (an extremely competitive one) and so we relocated to my OH's home town and I began my course in September 2008.

I am nearing the end of my first year and am wondering what on earth we have done! Emotionally it has been the best thing ever, but financially it's a disaster!!

My OH has been unemployed since we moved here as the town we've moved to is small and there are virtually no jobs unless you are a plumber, electrician, engineer, or have a hospital based career. My OH worked in customer services before the move which he hated, so we thought this would be an opportunity for him to retrain or do something different, but it didn't work out that well. After (literally) hundreds of rejection letters saying he was overqualified for anything he applied for (he has a diploma in media and management) he managed to get a job in a hotel through a friend which is where he is now. He has been there for 8 weeks or so, works 50-60hrs a week for £6.80p/h and was paid £800 this month. He gets paid again on the 3rd August.

I love my course, and recieve a bursary of 589.00 per month (which included dependants allowance as OH was unemployed). It will most likely be reduced to about £380 per month from september as OH is now working. I also get my student loan (I am only entitled to the maintenence loan due to the bursary) but have not included that in the SOA as I only get it every few months and it goes straight on car repairs or the like, so I keep it as an emergency fund.

So, the situation at present....
For the second month we have gone over the overdraft limit of £1000. I called HSBC today after I noticed we have accrued £164 of charges for last month so I am dreading what they'll charge us this month for unauthorised 'borrowing' as they put it. The girl at HSBC said we were unlikely to be granted an extention to the overdraft as we have already had one in the last 12 months. So she gave me 2 other options:
1) A flexi-loan of between £500 and £5000 (Variable APR 17.9% - min payment £20 p/m, max payment £80 p/m).
2) A personal loan of £7000+ with an ''exclusive loan rate'' which is showing on our account of 8.7%.

She advised me to check my experian credit score which I have done - it gave me a score of 999 'Excellent' so I presume this means we may be accepted for a loan of some sort.

I had a good look through the site and into snowballing, but the calculator showed that it would take 85 months to pay back our debts (listed below) and cost us £9,137.51 in interest costs.
If we got an unsecured loan to cover the lot at 8.7%, £11,000 over 5 years would cost £226 per month and the interest overall would be £2604. This seems a better option to me right now.

If you've made it this far then thank you!! Could you offer any advice? I've tried to be truthful as to what we actually have been spending every month, so please be gentle as I know we're far from perfect, but I just need to get out of this mess somehow so I can use my current account again! Here is my SOA:

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household......... 0
Number of cars owned.................... 2
Monthly Income Details
Monthly income after tax................ 800
Partners monthly income after tax....... 590
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1390
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 550
Management charge (leasehold property).. 0
Council tax............................. 89
Electricity............................. 59.85
Gas..................................... 77.7
Oil..................................... 0
Water rates............................. 25.72
Telephone (land line)................... 0
Mobile phone............................ 35
TV Licence.............................. 12.04
Satellite/Cable TV...................... 0
Internet Services....................... 17
Groceries etc. ......................... 250
Clothing................................ 40
Petrol/diesel........................... 75
Road tax................................ 26.25
Car Insurance........................... 50
Car maintenance (including MOT)......... 50
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 6
Pet insurance/vet bills................. 25
Buildings insurance..................... 0
Contents insurance...................... 7
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 16.66
Haircuts................................ 10
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1422.22

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 50
Other assets............................ 0
Total Assets............................ 50

No Secured nor Hire Purchase Debts
Unsecured Debts
Description....................Debt......Monthly...APR
HSBC CC........................5132.23...125.......18.9
HSBC Gold......................1468......38........16.9
Barclaycard....................187.2.....5.........16.9
Gas/Electric underpay..........390.72....0.........0
Tax Credits Overpayme..........984.......0.........0
HB Overpayment.................1294......0.........0
Current Account................1391......0.........19.9
Total unsecured debts..........10847.15..168.......-

Monthly Budget Summary
Total monthly income.................... 1,390
Expenses (including HP & secured debts). 1,422.22
Available for debt repayments........... -32.22
Monthly UNsecured debt repayments....... 168
Amount short for making debt repayments. -200.22
Personal Balance Sheet Summary
Total assets (things you own)........... 50
Total HP & Secured debt................. -0
Total Unsecured debt.................... -10,847.15
Net Assets.............................. -10,797.15

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RAS

Why have you not got a student bank account with a free OD?

And

a) are you currently claiming single person's dicount on the council tax?
b) did you claim CT benefit last year when OH was unemployed?

Your groceries are very high, you could reduce that substantially.

Are you on a 52 week bursary?

Bicks

Why have you not got a student bank account with a free OD?

a) are you currently claiming single person's dicount on the council tax?
b) did you claim CT benefit last year when OH was unemployed?

Your groceries are very high, you could reduce that substantially.

Are you on a 52 week bursary?

I do have a student account with a free o/d with Halifax, but they have been really difficult from the start and will only give me £500. I actually forgot to add this to the list as I have used it all and now get letters from them asking me to pay it back - and I'm only in first year!!!??

Just to explain about benefits... myself and my OH both claimed Job seekers allowance (JSA) when we moved here, and I also claimed Housing Benefit (HB) (as only one of our names could go on it for some reason?) and Council Tax benefit (CTB). I stopped my JSA when I started uni, informed the council of my change of circumstances for my HB and CTB claims. My payments didn't change so I stupidly assumed we still qualified due to our low income. OH's contribution based JSA ran out in November 08, so he applied for income based JSA and was rejected, told that my income of £580 was too high for him to qualify. So no money since then.

In March, I called the council to inform them that my OH may have got a job (which incidently he didn't end up getting) and asked for a change of circumstances form to be sent to me so I was ready. They then decided that they had been overpaying us and immediately took nearly £1,500 out of our joint account to cover the overpayment of CTB!! Thus began our real problems!

So now, we owe them £1,294.55 for HB overpayment and they will not accept less that £40 per month from us. This payment will begin in August.

So my answer is yes, we do claim the single persons discount. I agree that our groceries are too high - though I have included our food, cat & dog food, all toiletries and cleaning products, alcohol (we don't go out, just round to friends houses for drinks), and I admit I do smoke, so my cigarettes are included in that (please don't be too harsh though, I have no other vices!).

Yes, my busary is 52 weeks. Thanks for your reply BTW :j

Bicks

Oh, I forgot, the lady from HSBC gave me a third option:
3) pay off the overdraft using my HSBC Credit Card. She finally admitted after I had asked her 10 times that this would be charged as a cash advance rate, not at the purchases rate.

How does this work when I already have purchases on the card? It seems to me like it would make HSBC a lot of money at my expense, and still wouldn't solve my problems!!

I HATE debt! I just want to be able to get through uni this time - I quit my last degree in the 2nd year due to money. It's heading that way again and I don't know what to do!

costaerer

why is your gas and electricity so high?

chalkie99

Bicks wrote: »

works 50-60hrs a week for £6.80p/h and was paid £800 this month.

Doesn't seem right

That's an average of, say, 55 hours per week, 220 hours a month, giving a gross of £1496. How does he only bring home £800?

Miss_J

Haven't got much advise for you, but just wanted to say, having qualified in September following a 3 year NS funded course, I really feel for you.

Have you looked into claiming working tax credits for your husband with your income being low? I got working tax credits throughout the course, they don't class your bursary as taxable income so will only take your husbands salary into account.

Almost a year on from qualifying, I am attempting to make a good start at reducing the debt that has accumulated as a result of studying and giving up a good job for the pleasure. Thankfully because the NHS is so understaffed there is always the opportunity to get overtime and make bigger payments to reduce the debt quicker.That's what I'm doing when I get the chance.

Bicks

Thanks for the replies guys!

I spoke with OH this morning about what we can do and we have decided that the first thing we can do is start to look for a cheaper place to live. This will be tricky though as we have a cat and a dog and many landlords won't have us because of this. We'll give it a go though.

Nextly, I'm unsure as to why our gas and electric are so high. The house we are renting has no insulation so heating cost loads over the winter and we are now having to pay a higher fixed monthly amount to cover what we owe from then (our payments were much less in the winter at £80 so the hike to £130 is rough!). Does anyone know if we can move while we still owe money to the utility company?

I have to admit that we have been burying our heads for so long now that it feels like we've messed up everything. Does anyone have any advice regarding the 3 options HSBC have given us to get our current account unfrozen? That is the most immediate problem. Thanks.

Bicks

Oh, and to reply to Miss J -

Thanks for the moral support! It is really hard to do NHS courses I agree. I didn't realise this when I started out!

We owe working tax credits over £900 from back in 2004 when they overpayed us. We have appealed this over the years but now we have been given no choice but to pay it back. I am really scared to reapply because of the mess they made of it last time, and also because we owe them so much it seems pointless to reapply. They are giving us a reprieve at the moment due to our financial position but I don't know for how long that will last.

We're clearly in too much of a mess for even MSE to help! Thanks anyway.

Floxxie

Hi Bicks,

I think you need to hang around. There are lots of people who can offer you really sound suggestions but you need to be open to answering their questions and actually accepting that you can get out of this.

How much does your OH earn? If it is only £800 based on the hours he is doing, there is something wrong with the his payslip or tax.

I don't understand why you want to take a loan from the bank? Are you suggesting that you consolidate your debts? Are you looking for a quick fix to have money available?

Your gas and electric are extremely high especially if both of you are out most of the time.

Your groceries could be reduced, even with a cat and dog.

On raising income, there are plenty of challenges on this board...

You can do this. Please don't get tempted by the bank's options. See what others on here say. There's lots of people who have been in a similar situation and I know how hard it is when you are studying and have debts hanging over you.

Floxxie

angelaf_3

Would it help if you opened a new bank account and had your money paid into there so that you were in charge of who you paid and when.

It would be a good idea to have a chat with one of the debt free charities such as cccs, payplan, ndl, cab or cap just for advice and options.

As someone else as suggested is your husbands tax code correct, because if he is on an emergency code then it will be really high and the sooner it's sorted the better.

The up your income thread contains many ideas that might be useful to you.

Also I can understand your reluctance to get involved with WTC again (don't get me started on the way that system works; why they had to change from the old way i'll never know) but if you are entitled to any credits then it might at least pay of some of the arrears.

And most importantly as Floxxie said stick around. There are some fab people around here and they will encourage and support you. Hang in there because it is so important you finish your course and it will make such a difference to you both when it's finished.