Huge credit card debt

hypno06

mitchaa, my story is that we discovered major structural work to our house, just three weeks after we had moved in......all that, despite paying hundreds for a full structural survey that only showed up a little damp around the shower :rolleyes:

Because we had purchased with a 95% mortgage, we suddenly found the value of our house plummet because of the seriousness of the problems (and they are too numerous to list - we call it the house from hell), leaving us in huge negative equity and not able to borrow any more from the building society to do the essential repairs.

We tried suing the surveyor - no luck, we tried suing the previous owner, again the old "buyer beware" thing......and we ended up funding the re-building on loans and credit cards.....

We borrowed a huge amount, as we had little choice. Our only alternative was to hand back the keys and be repossessed, but we would have still been liable for the difference between sale proceeds of a falling down house, and the 95%-of-the-original-value mortgage. Plus, my job is one of the few that you cannot hold if you are bankrupt etc, so if I wanted to keep earning, I had to keep paying :rolleyes:

Once we had such a huge amount owing, we quickly fell into the trap of being paid, then making the payments on the mortgage, loans and cards, then finding that we had nothing left with which to eat or put petrol in the car.....so out comes the credit card to do a weekly shop at the supermarket.....and so the debt increases.

After three years, and OH having a nervous breakdown over it, we sold the house, recouped what we could, but which in reality only covered the original mortgage, not the extra borrowings, and have been steadily repaying the excess ever since.....We discovered the problem in 1999, and finally sold it in 2002.

So, nothing reckless.....nothing extravagent......a little bit of the "we're in so much debt, what does another takeaway matter" attitude......but a whole lot of high APRs and hard work to keep things ticking along, robbing peter to pay paul, and a mental note that a structural survey, no matter how much it costs, is not worth the paper that it is written on - get a friendly builder to have a look round before you buy instead.....

Because of my job, I have not been on a DMP, but at its worst, I will readily admit that the stress of desperately trying to keep things going lead me to seriously consider whether I should throw in the towel, go BR or on a DMP, and change career.

For ME, I am pleased to report that I could see it through - things are manageable, I am still in the career I love, and no longer have to panic when the annual "credit check" is carried out at work.

mitchaa

hypno06 wrote: »

mitchaa, my story is that we discovered major structural work to our house, just three weeks after we had moved in......all that, despite paying hundreds for a full structural survey that only showed up a little damp around the shower :rolleyes:

Because we had purchased with a 95% mortgage, we suddenly found the value of our house plummet because of the seriousness of the problems (and they are too numerous to list - we call it the house from hell), leaving us in huge negative equity and not able to borrow any more from the building society to do the essential repairs.

We tried suing the surveyor - no luck, we tried suing the previous owner, again the old "buyer beware" thing......and we ended up funding the re-building on loans and credit cards.....

We borrowed a huge amount, as we had little choice. Our only alternative was to hand back the keys and be repossessed, but we would have still been liable for the difference between sale proceeds of a falling down house, and the 95%-of-the-original-value mortgage. Plus, my job is one of the few that you cannot hold if you are bankrupt etc, so if I wanted to keep earning, I had to keep paying :rolleyes:

Once we had such a huge amount owing, we quickly fell into the trap of being paid, then making the payments on the mortgage, loans and cards, then finding that we had nothing left with which to eat or put petrol in the car.....so out comes the credit card to do a weekly shop at the supermarket.....and so the debt increases.

After three years, and OH having a nervous breakdown over it, we sold the house, recouped what we could, but which in reality only covered the original mortgage, not the extra borrowings, and have been steadily repaying the excess ever since.....We discovered the problem in 1999, and finally sold it in 2002.

So, nothing reckless.....nothing extravagent......a little bit of the "we're in so much debt, what does another takeaway matter" attitude......but a whole lot of high APRs and hard work to keep things ticking along, robbing peter to pay paul, and a mental note that a structural survey, no matter how much it costs, is not worth the paper that it is written on - get a friendly builder to have a look round before you buy instead.....

Because of my job, I have not been on a DMP, but at its worst, I will readily admit that the stress of desperately trying to keep things going lead me to seriously consider whether I should throw in the towel, go BR or on a DMP, and change career.

For ME, I am pleased to report that I could see it through - things are manageable, I am still in the career I love, and no longer have to panic when the annual "credit check" is carried out at work.

Wow, what a story. I suppose when you look at it like that, it's very easy to do should luck not go your way.

Apologies, I had the old stereotypical view that if someone was in that amount of debt, it must have been down to their own sheer stupidity and reckless spending habits, i.e £1000 on a handbag, a few hundred on a pair of shoes, i'll pay that up in the next couple of months kind of idea.

I would have thought you would have been able to take your dodgy surveyor to court. Im surprised that there was no legal protection for you

dancingfairy

Sometimes people loose their jobs, people get sick, people die , get divorced (and left with a mess that they might not have even known about) etc.
Yes sometimes some people get in a mess through stupidity or bad money management as well - I think there's as many reasons as there are different types of people. Also it can soon spiral out of control - the apr's go up, you borrow more, the fridge breaks/the car breaks, you borrow more etc.
df

hypno06

mitchaa wrote: »

I would have thought you would have been able to take your dodgy surveyor to court. Im surprised that there was no legal protection for you

That's what we thought - we got £4k as "a gesture of goodwill".........Which I think covered the cost of a few windows as a finishing touch :rolleyes:

Mind you......handbags are one of the things I wish I *could* attribute some of my debt - I look lovingly at such delights......then get my MSE head on and aim for the nearest Charity shop instead

I so look forward to 2010 - a brand new decade where I leave my problems behind

pepe2008

dancingfairy wrote: »

Sometimes people loose their jobs, people get sick, people die , get divorced (and left with a mess that they might not have even known about) etc.
Yes sometimes some people get in a mess through stupidity or bad money management as well - I think there's as many reasons as there are different types of people. Also it can soon spiral out of control - the apr's go up, you borrow more, the fridge breaks/the car breaks, you borrow more etc.
df

I dont think I'm alone in having run up my biggest debts when I was earning my biggest income! .....'I'll be able to pay that off ..no problem:rotfl:'

hypno06

How's things today Kingston? I hope you are feeling a bit better.

debtmonkey09

kingston_2730 wrote: »

I still don't know why I am more likely to lose my house because I want to keep it though. In my opinion my desire to not lose my home is what is motivating me to deal with this terrible situation I am in.

I overspent on credit cards a few years ago and got to the point outgoing and incoming were equal, with the majority on debt and a massive mortgage... and then I was made redundant out of the blue. That was that, pay cuts and stints of zero income every year since.

I spent the first 3 years of this driving us both to the edge of insanity trying to keep the house and we've both been ill as a result of it at various stages. But if you think of it as keeping a HOME and just changing the actual house for one that fits your means better... that was truly a revelation and we're positively looking forward to living somewhere very different but getting our sanity back.

Once you're in a more positive frame of mind about it all it suddenly seems much easier to manage your money... and then you get to the point you think you might be able to afford the existing mortgage after all, almost by accident. I think this is what was meant. A bit Zen I know... :-)

Poosmate

Hi Kingston, just popped in to say hi and hope you are feeling better.

Mitchaa, thanks for asking that, I've often wondered myself how other people got into debt. To be honest I can't remember how my debt problems started it's been so long. I guess I am just one of life's walking disasters in financial terms where something always goes wrong after I've paid for something else that I've saved up for, like insurance or a new fridge etc. and a good credit rating enabled me to use the credit that was provided to me in such times. A bad relationship turned very manageable debt into "you need to declare yourself bankrupt" (advice from my Union financial advisor/debt councillor type person). This was 10 years ago! EEK!

I didn't take his advice, I battled on, liquidised some assets and managed to get some debts settled, lose a debt that my ex had taken out in my name, and pay off more than half of another joint debt (that debt seriously p1ssed me off because the bank wouldn't put a stop on the account and everything I paid in £156 p/m the ex would withdraw).

Here I am 10 years later, still battling and now managing. It got better, it got worse many times in the last 10 years and I realise the things I bought during bouts of depression were not needed, but were symbols (jewellery and other possessions to replace that stolen by the ex, a £300 steam cleaner to cleanse him from my home), such bitter, dark depression. But I know about it now, I understand now and things will get better. I only had my LBM last year and I've made some positive changes and am now even able to make payments over the minimum required to my cc's.

Don't know why I wrote all that, but I hope it helps someone who is maybe going through a bad patch.

Poo

Oneday77

Money is the route of most evil. It buys things you shouldn't and runs out when you need it. I personally spent it on keeping up with the Jones's and not being savvy with other things.
I can only blame myself now I have reflected on what I have done. The denial is immense and the if I get that loan and consolidate with a little spare to fix this was easy, that fix this buy that always comes along and you get more.
I gave myself a good shake earlier this year and am on a DMP now and it is so good knowing that I will not be relying on credit anymore as I can't, just clearing it out. My Debt Free date is 2017 but I know I can improve on that, just need to work at it.

hypno06

Kingston, hope you are ok......pop in and let us know how you are getting on. I am going away for a few days, but will leave you in the capable hands of the other guys on here, and will catch up when I get back.