Need some advice re; moving from mortgaged house to council.

stefbate

Hi, we are having a few problems, dp is self employed, and work is really slow, we have spiralling debts, bills. Abnd its getting to the point where i am thinking that we should get rid of the house and apply for a council one.
It sounds really simple saying it like that, But dp says we will end up in a high rise flat. I said no we wouldnt. We have a 3 year old and a 15 year old. Not that that maked much difference.
I am just sick of living in debt, and am trying to think of ways of getting out of it, i know its an extreme thing to do, but i cant think of what else we can do.

What would happen if the house was repossessed? Would it be better to sell up before it got to that point? Would the council be helpful to us?

UK007BullDog

This is really difficult and to get on the council housing list is even harder. As long as you have any type of money they might not be very helpful at all as they have very long waiting lists. You would probably end up in some sort of flat in some sort of housing estate. Depending on where you live most of the houses have been sold off as Right to Buy deals and those still available are well coveted and to get one of those is very hard.
There are surely people on here who can advise much better on this issue as I dont know much about this at all. I know someone who has been on the waiting list for a council house for 4 years and she is 35 and lives with her 16 year old and dog with her parents, and she is still waiting. They do not class her as a priority as she has somewhere to stay. But then it depends where you live and how many people are waiting.

If I were in your position I would ask my self employed partner to get a paid job at least just to tie us over until the self employed job is picking up again.

You definately do not want to be repossed! It will damage your credit record for many many years and you will have problems getting a good deal later on as you are then classed as higher risk.

Have you thought of speaking to a debt councellor. If you look on this website there are many links to very good information to get you started.

Your older child is old enough to look after the younger one which means you could try to get a part time or evening job too to cover the debts, at least then you might not lose your house.

And always try to pay your mortgage first then the rest of the bills. The mortgage payments are the most important. You do not want to get into defaults or late payments. The credit card people can wait even if they chase you via debt collectors. Talk to them and ask if you can pay a reduced amount or freeze the interest rate for a while. But speak to the citicens advice bureau first as they know exactly what to write to the lenders, credit card people ect.

Good Luck!

MortgageMamma

Hi There,

Sorry to hear you are having problems, have you visited the debt free wannabe board as there are people on there who can help you. Without knowing your exact situation it truly is impossible to help further, but the advice given by bulldog is a good start. Have you thought about trying to consolidate all your debts into one payment? If you do choose to sell your house then maybe you should approach some housing associations and rent one, or perhaps consider shared ownership if it is viable.

What does your husband do for a living? Can he do some part time work as well? Do you work?

stefbate

Thanks both for your helpful replys. My dp is a joiner And i told him to look for a jub, i looked at loads of jobs on the job centre website, but he reckons he wont get one because he doesnt have the proper qualifications. I would work, but think would i be any better off financially, after paying childcare fees(no family to look after him). No body will give another loan, weve tried. Its not as if weve got loads of credit cards and loans anyway. The 2 credit cards we have only total up to £1500. We have a loan of 16,500. Do Debt managment companies take on self employed?

silvercar

A friend got evicted from their rental property and went to the council for help. With a 4 year old and 7 year old they were given emergency accom for 6 weeks in a hostel with shared facilities and druggies. They were told that if they went to live with friends in the mean time they would not be considered a priority and would take years to get council housing.

MortgageMamma

Try to avoid debt management if you can. Have you thought about remortgaging your house and paying your debts off that way?

Your hubby might be able to get a job as a shop fitter or kitchen fitter. The local councils also employ tradesmen, so he could look at your council website where they advertise these jobs. With your little one being three, does he/she not qualify for the free nursery education funding where they get 10 free sessions a week? They are normally entitled to these from the term after their third birthday, I knwo this as my childcare bill will halve once my son turns three in December. Also, if your husbands earnings are unpredictable and low, and if you are on a lowish income yourself, you will be entitled to working families tax credit and in all likelihood your childcare bills will be paid.

Anyway you are doing the right thing now by taking action to try and stop the debt spiralling further, and as has been mentioned previous, if you can't afford bills make sure its the bills that don't affect your credit rating, such as council tax water etc. Anything like a credit card, loan, mortgage - if you are late on those it will show on your credit rating and absolutely knacker up your credit to the point where if you do need a mortgage or somethign you will have to go on adverse credit products which costs a lot more, which would make it harder for you to get out of debt.

When we went through a bad patch when I first went self employed we got rid of sky, got rid of one of the mobiles, cut the phone package down, tried to keep the heating off as much as possible, shopped in aldi and lidl (for about a year), had showers rather than baths, used economy settings on washing machine, walked instead of driving and generally didnt spend a penny unless we had to. I'm probably not telling you anything you are not already doing but I hope I've helped you in some way

BobProperty

stefbate wrote:

Hi, we are having a few problems, dp is self employed, and work is really slow, we have spiralling debts, bills. Abnd its getting to the point where i am thinking that we should get rid of the house and apply for a council one.

Debt Free Wannabe board as has already been suggested

stefbate wrote:

It sounds really simple saying it like that, But dp says we will end up in a high rise flat. I said no we wouldnt. We have a 3 year old and a 15 year old. Not that that maked much difference.

I tend to agree with "dp", and once they have offered you accommodation they have met their obligations. If you turn it down you are intentionally homeless so you are no longer their problem.

stefbate wrote:

What would happen if the house was repossessed? Would it be better to sell up before it got to that point?

To answer the second question first, Yes, it's better to sell it before you get repossessed. In crude terms it's the difference between a !!!!!! credit rating for 1 year and an even worse credit rating for 6 years.

silvercar

You are definitely doing the right thing in addressing these problems now rather than waiting until the situation gets worse.

I don't think you can sell your house as the council will class you as intentionally homeless.