Income is so much lower that outgoings....SOA attached

milliemonster

Yes this is the problem, you can't pay your debts right now and in all honesty you can't rely on ifs and buts and what MAY happen in the future with house prices and your salaries. The fact is you have to address the reality of where you are now.

Your mortgage is £1750 a month against an income of £2395, you have no room for if your interest rates on your mortgages rise again and even without the debt, this level of secured debt is unsustainable on your income.

You must get professional advice. Do you really want to be living hand to mouth for the next few years struggling to pay for this house? there is more to life than struggling on paying a mortgage you simply cannot afford.

Please speak to one of the debt professionals

rictus123

Really you need to seriously think about getting in touch with debt charities and think about bankruptcy. If there was obvious outgoings that could even claw back £800 of the £1200 short then you could maybe have a chance of getting somewhere but honestly theres nothing extreme at all about your outgoings. Sorry but id head for the bankruptcy board.

beanielou

As has been said you really need to think about bankrupcy.
Your secured debt is way to high in relation to your income.
Have you actually applied to go on the goverment mortgage scheme?
Are your secured debt repayments up to date?
Are your circumstances guarenteed to change for the better in the next month or two? No?
You really need to think of bankrupcy.

property.advert

Lots of calls for BR and they are probably right. The 2nd mortgage is the killer. What I didn't touch on before is how you got into a state before that you borrowed 62k from a company you knew had a bad reputation and at 135% of value ? Not being judgemental, but you must have been desperate then. Was it a runaway spending habit before ? If pertinent, then you have to emotionally address that reason before moving forward.

If you are paying anything, stop. Get all money you have in any accounts out. Open an account with someone totally unconnected with anyone you owe money to. Use that from now on. Don't set up DDs except for utilities, insurances and council tax etc. No CCs or mortgages. That should give you some cash. Get rid of the HP car and buy a 2/3k replacement that you could keep through BR. Prepay any annual insurances, Stash some cash somewhere, maybe with a trusted relative. Get a prepaid card (I recommend cashplus annual £29.99 fee).

Get some advice for sure. My experience is that haven't a clue how to help you get out of the mire you are in. You'll have to press to get someone who can see the big picture.

I still think the key is doing something with the second mortgage. If you can't then you are going bankrupt for sure (unless this bank thing comes off). That won't help you with the 2nd mortgage though and that is where the issue is. The CCs can go whistle for their money and you get onto a 5 year plan but you can't get there if your mortgage repayments cannot be drastically cut and not just deferred.

That is how I see it and I suspect, how your 2nd mortgage people will see it, if they know what the real picture is. I can find no rationale for them not doing something to keep you out of BR as then they at least have a chance of getting something back.

Sisyphean_Task

If I thought I could get £200k for the house sell I would sell it as quick as I could.

Pay off the mortgage, reduce the unsecured debt and find a cheap rental nearer to your husband's work to reduce the petrol bill which is going to increase dramatically this year.

If you try keep the house once interest rates go up you are going to be dead in the water. The house value will drop, your mortgage will increase and you will walk away later with a much higher debt.

Quantitative Easing has artificially reduced interest rates to a 300 year low and created a last selling opportunity for people like you who cannot afford to live in a house they were duped into buying. It's intended that people who can afford large deposits are going to be duped into buying now as they can afford the loss when house values fall - you obviously cannot.

Delboysgal

I'd like to thank you all for your input and would like to update you to where I am today...

As I have said previously, BR is not our first option as we are trying to better ourselves. We have resigned ourselves that the car may need to go, but with no savings and no spare cash we are not able to do this straight away. We NEED 2 cars so that we can get to work...no work=no money and so the circle continues. I have laid all the cards down on the table to my parents who are in no way financially able to "just" help us. IF (and that is a big if) they can help us then it wont be the £1200 short each month, as they don't have that type of cash. But the situation with a 2nd car might be where they can help us (financially).

We are due to go to the CAB on Tuesday. We have discussed the possibility of applying for Govenments homeowner support scheme.

I have spoken to the Mortgage co today and explained our financial difficulties. They have taken details which will go to their underwriters for consideration of a payment break. I hope to hear early next week of their decision.

Letters to the Credit card debts are being sent this weekend offereing £1 token payments.

I will update when I know more....