1st time user and I need some advice on IVA if anyone can help!!

Shammers

Hi, This is the first time I've posted a thread on this site, although I have been a fan of the site for months since my mum recommended it and niw I've recommended it to all my friends.

Anyway, my OH and I are in a bit of a rut and don't really know what to do. We have 2 children, a mortgage and appx £30k worth of debt which we're struggling to pay back along with our normal outgoings. I spoke to Paypal this evening and they recommended an IVA but I'm not too sure whether this is the right option or perhaps to look at a consolidation loan for £25k and pay the rest off monthly.

This probably sounds very babbling but I'm very stressed and worried.

Oh, we both work full time.

Any advice would be great.

Thanks

Little_Miss_Winner

Hello, welcome to mse!

Any chance you can post an soa (statement of affairs - incomings/outgoings) So we can see where you are upto?
Also how much do you owe on your mortgage, and how much equity in the property?

Hugs
pot

Shammers

Hi, thanks for looking. Well hear goes:

Outgoings:

Mortgage: £437.65 pcm - outstanding £107,400, equity appx £11,000
Bills & Insurance: £371.12
Food, car: £378.00
Childcare: £800
A&L Loan: £142 pcm - outstanding £5,500
Sainsbury Laon: £167 pcm - o/s £10,000
AA Loan: £161 pcm - o/s £5,000
TV Finance: £29 pcm - o/s £250
Halifax c/c: £40: o/s £1815.68
HSBC c/c: £10 - o/s £186
Tesco c/c: £70 pcm - o/s £864.60
Virgin c/c: £66.36 - o/s £5362.24
Next cat: £25 - o/s £170
LX Cat: £15 - £570

Total outgoings = £2712.13
Incomings = £2440

Total = -£272.13

So as you can see a slight problem!! What do you think??

Chortle_2

Welcome to MSE :beer:

Could you break some of those outgoings down for us, such as 'bills' and insurances, and seperate your food and car expenditure?

There is a fab thread at the top of this board, by southernscouser, entitled 'first time posters' which will give you a standard format for a statement of affairs, which will allow us to see easily where there are any potential savings.

The APRs on your loans and CCs would be really useful too.

(I know it is a lot of 'personal' info to give out, but it really will help the DFW nerds help you )

Looking at your mortgage payment, am I right in assuming that is interest only? Seems very low for a £100k+ mortgage

£272 isn't a HUGE difference to make up each month (although I appreciate it must feel like it!) - some people on here started with deficits of circa £1300! It should be fairly easy to make up at least some of the difference just by cutting back a bit, if you've not already done that, and then with rate tarting (if your credit file is up to it) and snowballing, you should be able to avoid both the IVA and the consolidation loan!

Little_Miss_Winner

Hi again,

Agree with chortle.

Also it may help you to post your interest rates on the c cards.

Sorry coming back with loads of questions instead of answers, but you will get loads of replies, suggestions, when we get the bigger picture.

Off to bed for me now, but will be back tomorrow to see how you got on.

HUgs
pot

Shammers

Hi,

Building Ins - £23.18
C Tax: 91
Water: 56
Gas: 21
Electric: 29
Phone, tv, broadband: 45
Mobile PAYG x 2: 20
Income Protection Ins: £37
Life Ins: £48.94
Food shopping: £250 (have to buy nappies and baby milk)
Smoking: £10
Social/family outings: £20
Car Ins: 43
Petrol: 40
Car tax savings: 15

HSBC c/c not too sure apr - appx 14%??
Virgin 0%
Halifax 0%
Tesco - Not too sure - quite highish

A&L Loan: 7%ish
Sainsbury Loan: 6.1%
AA Loan: 7.1%

LX Catalogue: 32%

Yes the mortgage is interest only.

I've cut down on as much as I can on everything. We did have contract mobiles but they've gone, TV/Phone was £80 pm. I'm really trying all I can, just wanna sort things out for our future and our kids. We also got engaged at New Year and want to marry in 2008 !!

Little_Miss_Winner

Also, £800 seems high for childcare, are your children pre-school age/s ?

Shammers

Yes, and they go to a childminder which is alot cheaper than nursery. My partner and I both work full time - these are just basic costs.

We're not paying £800 til July. They're being looked after by family until then which is costing £500pcm.

Little_Miss_Winner

HSBC c/c not too sure apr - appx 14%??
Virgin 0%
Halifax 0%
Tesco - Not too sure - quite highish

Would you not be able to balance transfer the hsbc, and tesco to the virgin and halifax. That way you would only have 2 cards on 0%, which will be far easier for you to manage. Ring them and check.:j

You also need to try and pay the most off lx direct, and Next as there interest rates are extortionate.

Don't know whether you have had a look at the snowball calculator? Apologies if you have.

But heres the link;-
http://www.whatsthecost.com/snowball.aspx

The idea is if you pay the majority of your money to the highest debt (APR), you will save loads in interest and then be able to snowball the money you save, onto the next debt.

Really gotta go now, sorry if this post seems a little abrupt/rushed, was going to bed at 10pm but then got carried away as usual with mse!:rotfl:

hugs
pot

moozie_2

Hello shammers

I've looked through your SOA and if I got the figures right, at the moment you balance every month as your childcare is £300 less than stated (but goes up to £800 in July, right?)

If I have this right, you have very little opportunity in paying anything other than the minimum payments for your debts. Transferring to 0% would be good if possible but you will still be short when your childcare increases and when you include other things that are not in there at the moment (presents, emergencies etc)

I can see why Payplan suggested an IVA. I appreciate you want to explore all your options but they really know what they are talking about. I don't think a consolidation loan is the answer for you. Borrowing £25k and paying another £5k by different means sounds like a messy plan which is questionable whether it will save you anything on interest. As pot'o'gold said, check out the snowball calculator, it might put things in perspective for you.

Good luck with what ever you decide.

davek1

if i can add my 2 penneth please please avoid consolidation loans. You will be in the same mess a few years down the line. I know to my cost.

Good luck

Dave