Debt advice needed badly. Help please!

debtdope

Long time lurker here who could really do with the help and expertise of all you debt-free wannabes. My situation is quite complicated and when I try to get my head round it all I just seem to go in circles!

Background: I work full-time, but my husband is out of work and suffering severe bi-polar disorder. He was previously paying Class 2 NI so didn't qualify for any contribution based benefits and my salary precludes him from getting any income based benefits. He has 3 kids by a previous so I pay for birthday/xmas presents etc for them. We're trying to find something from home my OH can do as he can't hold down a job working for anyone else for more than a few weeks before either mania or depression make it impossible and he gets fired.

99% of our debt comes from essential renovations to the house we're currently in. Stupidly I whacked down £45k of my £50k savings when we bought in 2007, keeping £5k back for the few things the survey picked up. However when we started digging there were much more serious problems and we've ended up drawing on nearly £25k from loans/cards to fix things. House is now worth £25k less than purchase price and nothing has moved in our town for a year. We've moving next month for my work to a house my Dad has bought for me to live in - I'm already paying the utilities etc and will start paying a peppercorn rent of £200 once I have my current house rented out (rent is only expected to cover mortgage repayments in this area).

Credit Rating: Currently reported by Experian as 'Fair'. I've missed no payments at all, but it looks like the amount of credit available to me is dragging my score down a bit.

SOA below

debtdope

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................ 2850
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2850

Monthly Expense Details
Mortgage................................ 427
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 180
Electricity............................. 116 (for 2 houses)
Coal..................................... 180 (£180 a month for approx 6 months of year)
Oil..................................... 0
Water rates............................. 28
Telephone (land line)................... 16
Mobile phone............................ 25
TV Licence.............................. 11
Satellite/Cable TV...................... 0
Internet Services....................... 25 (reimbursed by employer monthly)
Groceries etc. ......................... 427 (inc dog food @ approx £70 a month)
Clothing................................ 20
Petrol/diesel........................... 100 (car costs for 2 cars)
Road tax................................ 28.5
Car Insurance........................... 69
Car maintenance (including MOT)......... 100
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 40
Buildings insurance..................... 11.25
Contents insurance...................... 10
Life assurance ......................... 12.6
Other insurance......................... 0
Presents (birthday, christmas etc)...... 15 (yearly expenditure for 3 kids, 3 parents averaged out to a monthly figure)
Haircuts................................ 0
Entertainment........................... 20
Holiday................................. 0
Emergency fund.......................... 0
House Renovation........................ 200 (this really fluctuates, for instance in Dec we had to pay £400 to get a small flat roof replaced)
Pension................................. 70
Total monthly expenses.................. 2131.35


Assets
Cash.................................... 0
House value (Gross)..................... 110000
Shares and bonds........................ 0
Car(s).................................. 2500 (2 cars)
Other assets............................ 0
Total Assets............................ 112500


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 85234....(427)......4.5 (repayment mortgage)
Total secured & HP debts...... 85234.....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Abbey Loan.....................8717......271.......0
HBOS Credit Card...............10148.....102.......0
Barclays Loan..................5319......53........0
Student Loan...................950.......30........0
JD Williams....................150.......7.........0
MBNA Credit Card...............1089......50........0
Tesco Credit Card..............1160......50........18
Barclaycard....................3427......77........6
Total unsecured debts..........30960.....640.......-


Monthly Budget Summary
Total monthly income.................... 2,850
Expenses (including HP & secured debts). 2,131.35
Available for debt repayments........... 718.65
Monthly UNsecured debt repayments....... 640
Amount left after debt repayments....... 78.65

Personal Balance Sheet Summary
Total assets (things you own)........... 112,500
Total HP & Secured debt................. -85,234
Total Unsecured debt.................... -30,960
Net Assets.............................. -3,694

DanielleNic87

You say your OH was paying class 2 contributions, providing that he has paid enough of them then he would be entitled to benefit. May want to check what the benefits office and HMRC hold, they may have not updated their systems properly.

Danielle

vandanfc

Has OH tried claiming DLA for his Bi-polar ? Worth looking into. How about a part time job and top up with DWA (if applicable) ?

Food budget still high even with dog food accounted for. Would OH or you get into cooking and meal planning do you think ? Have a look at OS boards for food plans etc.

McKneff

If Hubby doesnt work, couldnt you manage with just one car.

Your grocery billl for 2 of you plus dog is massive and could virtually be cut in half if you really tried.

debtdope

Thanks all - some preliminary answers below:

Benefits: Hubby had a meeting with benefits office and got a letter saying he'd not paid enough NI contributions last year to claim anything on the contributions based benefits. Even with severe bipolar he's apparently entitled to nothing due to my income and us having no kids at home.

Pet: Yes, food for the dog is very expensive. I'm afraid that he's a Great Dane with a sensitive tum so is on a special diet. There is a wholesale place online that sells suitable food which would cut the monthly cost by about £20, however it's raw and needs to be frozen and we have no freezer space. The house we're moving to does have a freezer so I can switch over then and save the £20 a month.

Cars: This one is a bit of a catch-22. We could do with one car, but we're stuck in a rut over them. In short, one is a small city run around that's economical....but the dog can't fit in it. The other is a big estate which is only really used for ferrying the dog around. Both cars aren't worth much and break down a lot (£525 last month in repair bills for both!). Ideally we'd like to get rid of both and buy one better car which can take the dog...but what we'd get for the current cars wouldn't cover the cost of a better estate (nothing special, but something under 10yrs old which doesn't have inter-galatic mileage) so it'd be a case of taking on more debt. Any ideas on that conumdrum appreciated! Oh I should also mention that our current location and the location we're moving to are extremely rural with no regular bus services to anywhere so public transport is not an option for getting around.

Grocery bill: I know I'm going to have to work on getting this one down. We don't buy pre-prepared food at all and buy organic and locally reared meat. Unfortunately this all seems to cost the earth! I was shocked when I went through my bank statements for November to get an accurate food expenditure. I think I may have to sacrifice principles here and go to supermarket own brand goods to cut down costs. We do also drink alcohol at home (probably about £15 a week) so will have to cut that out too.

debtdope

computershack wrote: »

Are you sure he's not entitled to Contributions Based ESA? Class 2 NIC counts towards contributions based health related benefit such as ESA.

Why are you paying electricity for two houses?

Just going by what DWP have told him, he's not entitled to anything. Basically he's had a total of about 6 weeks work in the last 2 years and has paid very little NI (Class 2) as a result. He currently owes £200 for 2009 NI contributions and doesn't have the money to pay it because his earnings in 2009 were lower than the amount they're asking for! (No idea how they work out how much should be owed, but his tax return for the previous 3 years showed zero profit).

On the electricity. The utilities in both houses are in my name and £66 a month is being taken on the new house by DD as an estimated payment for gas and electricity. I only set up the account a few weeks ago so December was the first month for this payment and with us actually moving there in Feb I was planning to phone them up when we'd been there a few weeks with a meter reading so they can recalculate and use the credit up. There are builders in there at present fitting a new kitchen so I needed to turn the electricity on and get the account set up.

frosty

Hi, some pet insurance will cover special diets if confirmed by a vet,might be worth checking.

PNPSUKNET

If only used for building work pay on recipt of bill for second house, with your income you should be able manage for x2 of you easily.

debtdope

PNPSUKNET wrote: »

If only used for building work pay on recipt of bill for second house, with your income you should be able manage for x2 of you easily.

Swapping to a bill may be an idea.

I agree we should be able to manage, but for some reason the money is gone a few weeks into the month. Lord knows why because we certainly don't go out, don't take holidays and the last time I had my hair cut was 3 years ago! It's things which constantly seem to crop up which knobble me - last month the starter motor went in one car and the sump in the other...big bill. Flat roof on extension started leaking...another bill. Hubby's ex suddenly starts screaming for school uniforms etc (she doesn't work) so more money out. At the moment the heating element in the tank has gone and we need a skip changing over so I know that's going to be at least another £200. Every month I seem to end up into my overdraft.

I guess once I'm not constantly spending out on the current house that'll help. I also need to do something about the cars I know - one of them alone has cost around £950 last year in repairs

vandanfc

"Benefits: Hubby had a meeting with benefits office and got a letter saying he'd not paid enough NI contributions last year to claim anything on the contributions based benefits. Even with severe bipolar he's apparently entitled to nothing due to my income and us having no kids at home."


DLA is not a means tested benefit. If his bi-polar is so debilitating, you should look into claiming.

http://www.direct.gov.uk/en/disabledpeople/financialsupport/dg_10011731