My SOA - what do I do now?

Keeping_Positive

consolidation loans are not the best way to solve things many of us have tried this approach to sort things only to end up in more debt. A dmp will hurt your credit score so you may have to pay a bit extra when/if you remortgage.

Keeping_Positive

A rough look at your SOA shows you are 44ish pounds short a month so not too much to cut back. How about a concerted effort on saving as per above posts especially grocery for a few month to see if you can avoid the DMP.

happymoneysaver79

Keeping_Positive wrote: »

A rough look at your SOA shows you are 44ish pounds short a month so not too much to cut back. How about a concerted effort on saving as per above posts especially grocery for a few month to see if you can avoid the DMP.

Hi!
Thats strange. On the SOA calculator it showed that I had around £5 clear each month. Although maths was never my strong point!
We have decided to cut back as much as possible but I just don't know if its enough. What would be ideal is to get all the credit cards on either 0% interest deals or decent life of balance cards, either that or a low rate loan. If this was possible we could afford the repayments and manage to get this debt hammered down. I just don't think that we will get the deals we want. The thing that is bothering me is the fact that I will be stuck here in this house for another 6 years. Do you know if its possible for someone who's been on a DMP to get a mortgage, or can you get a mortgage and pay a higher interest rate?

theoretica

May I suggest that you have nothing to lose in asking an estate agent for a professional opinion on what the rented house will fetch if you sell? I believe any capital gains tax will only be payable on the profit you make selling it, not the whole sale price. It is only bringing you in a bit over £200 a month (420 - the expenses on it), you say it needs work and if any becomes urgent then you will probably have to pay for it, not the tenant. If you sell you might be able to wipe off enough debt to make up for the loss of rent, and have less hassle. It is worth finding out the numbers so you can do the calculation properly.

happymoneysaver79

theoretica wrote: »

May I suggest that you have nothing to lose in asking an estate agent for a professional opinion on what the rented house will fetch if you sell? I believe any capital gains tax will only be payable on the profit you make selling it, not the whole sale price. It is only bringing you in a bit over £200 a month (420 - the expenses on it), you say it needs work and if any becomes urgent then you will probably have to pay for it, not the tenant. If you sell you might be able to wipe off enough debt to make up for the loss of rent, and have less hassle. It is worth finding out the numbers so you can do the calculation properly.

Hi! When I say it needs work, it is mainly cosmetic. It will be having a new roof paid for by the council in about a years time, it already has double glazing, insulation etc. We fitted a new kitchen around 3 years ago, however it is fairly tatty and requires full re-decoration. We know what prices fetch around this area and its not very much. We inherited the house and a smallish mortgage which has been added to in the past. I was under the impression that wew would have to pay capital gains on the full amount since the purchase?

roger196

Capital gains tax is only payable on the gain , ie selling price less probate value and less any capital expenditure on the asset (eg cost of extension)
suppose sale price..........70,000
less probate value..........42,000
less extension.................8,000
................................======
Gain............................20,000
less annual allowance.....10,100
................................======
...................................9,900
................................======
Tax at 18%...................1,782

Hope this helps.

happymoneysaver79

I will look into this further, thanks for your help.