Help desperatly needed

kel2607

HI we have known for a while we were in trouble but have finally accepted we need to do something but are unsure what avenue to take. The situation is we are in negative equity owe approx £60k on credit cards and our monthly income doesn't cover this help

Frozenace

Hi Kel, could you try and post a SOA. I bet you've got loads of stuff you could possibly sell on Ebay or so, it's really easy...

RAS

Hi

Do an SOA and we may be able to help http://www.makesenseofcards.com/soacalc.html

You may also want to speak to a debt charity but they need the SOA, so it is a good starting point.

leo1976

Hello! you've taken the first steps by posting here.

As others have suggested, complete your SOA. Sit down with a cup of tea and go through absolutely all of your expenses - it wont be easy for you and its likely not to make comfortable reading but once you have done it, we can help.

Lots of people will off advice and there are always solutions so try not to worry

Good luck with your debt-free journey, you can do it.

kel2607

we are going to do a soa this evening when oh comes home from wrk & kids in bed. We are getting the house valued today to see exactly where we stand don't think it will be good though.

andymc29

hi,
firstly, well done on taking the first step. Most of us here have buried ut heads in the sand and hoped the debts would go away before hitting our LBM's (light buld moments). So realising your debt is a problem is the first step.
As this amount is on credit cards, it likely you could move some of it onto lower interest loans over long payment periods. It would also be worth talking to your bank about it and your local CAB.
The main is not to panic, write down your SOA to see where things can be cut down, it's time to be ruthless here, the kids may like cheese strings and Sky TV but these things have to go, in the long run, your kids will grow up with a better appreciation for money abnd less likely to end up in debt themselves. so it's being cruel to be kind.
If you're in negative equity, don't panic, as long as your making your mortgage payments then you're fine, it does mean however that you can't unlock equity to pay off credit cards.

Jacks_xxx

:wave: Hiya Kel,

Don't panic.

Give us the SOA to look at and we'll make suggestions.

There's always a way through.

Love Jacks xxx

Charco_2

As said above, don't panic if your home turns out to be hugely in "negative equity"... it's kind of become a media buzzword striking fear and dread into the hearts of debtors but it's really quite meaningless unless you intend to sell the house! All that should matter to you is that you can afford your monthly repayments to your mortgage company!

And your mortgage repayments take priority over all your unsecured debt!

Your priorities should be a combination of household bills, food heat light mortgage council tax car(?) phones medicine insurance... Add up the total of these bills and take away from your household income

Then it's time to look at the credit cards. You have £60k on credit cards - and i'd say they're costing you a fortune each month but if you're going to be responsible about this you need to turn it on it's head. YOU CAN ONLY AFFORD TO PAY THEM WHAT IS LEFT OVER AFTER YOU'VE PAID YOUR HOUSEHOLD BILLS, and they can't take money you dont have! There you are, so relax! Take a deep breath and relax.

No point worrying about how you're going to pay all those bills because the simple fact is, YOU CAN'T! Doesn't that feel so much better!? (Isn't it funny how you don't have a debt problem, your creditors do ha ha!)

There are a number of options open to you then from
- moving your debts to lower (or free) interest rates for short periods of time
- entering into a DMP where a company will deal with your creditors on your behalf taking the hassle away from you
- an IVA where you can pay back an amount you can afford for a set period before the remainder is written off OR
- bankruptcy - which isn't a scary as it sounds but also isn't something to be entered into lightly!

Each of the options listed above obviously has pros and cons and you should learn more about them all before opting for one in particular. The good people on here can put their heads together and answer almost any question (could take on the eggheads i'd say!). The list is not extensive either, it doesn't include options like rob a bank or emigrate to Mogolia!

kel2607

Well house has been valued at £275000 which if it were to sell for that amount would be great as it would clear the mortgage meaning we could at least afford to eat. so we are going to put it on the market and keep our fingers well and truly croossed.

andymc29

does this mean you'll rent somewhere cheaper then?

misspoppy

What about all the costs of moving you will need a deposit to rent else where so that 2 months rent as you'll pay the first month in advance and removal fees a few hundred solicitors and estate agent fees, is this the best option?