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***please Help Me Sort My Debt***

Hi

I dont know where to start so will just start with a ramble! I need help and advice urgently please.

I am 24 and my OH is 27. We currently owe approx £15k on credit cards, £20k on unsecured borrowing, £33k loan taken out by OH's parents on our behalf.

We have a mortgage in the UK of £153k on a property worth £150k!

The debt is through purchasing a villa in Spain as a rental business last October. The villa we rent out and expected to earn more than we do. The rental money goes directly to pay the debts.

We do not live in our property in the UK and rent it out for £650 and the mortgage is £800.

I earn £1200 a month and my OH is a trainee teacher and earns £0!

We have never defaulted on any of the payments but are finding it hard to meet the payments each month. We have cut back on everything, moved out of the flat and in with her parents but now realise we can not meet the payments from next month onwards.

Would an IVA be suitable for us as we have no equity in the property in the UK. It is not possible to sell the place in Spain as costs involved would be £30k+ Also what does an IVA involve? We hope to move to Spain in 5yrs and wouldnt need credit in the UK again.

Thanks

Comments

  • I can't really help as it sounds rather complicated, some experts will be along soon no doubt. Just one thought, can't your OH get a job in the holidays?
    A minute at the till, a lifetime on the bill.

    Nothing tastes as good as being slim feels.

    one life, live it!
  • lynzpower
    lynzpower Posts: 25,311 Forumite
    10,000 Posts Combo Breaker
    HI there
    you need to do a FULL SOA, with literally all your outgoings, debts and APRs before we can advise really. Have a look at southern scousers first time posters, and we'll take it from there.

    Why are you renting out your house in the UK and making 150pcm loss. Sell the house, save yourself this at the least! :confused: I dont get it??
    :beer: Well aint funny how its the little things in life that mean the most? Not where you live, the car you drive or the price tag on your clothes.
    Theres no dollar sign on piece of mind
    This Ive come to know...
    So if you agree have a drink with me, raise your glasses for a toast :beer:
  • You've probably got a reasonable explanation but have to ask! ;)

    Your OH is training to be a teacher. How long is it going to take them to qualify? And is the idea that they will be able to teach in Spain? :confused:

    Do a full SOA and we will be able to help you more. See this thread for a guide. :)
  • Pobby
    Pobby Posts: 5,438 Forumite
    Hi and welcome.As lynzpower has said why are you hanging onto the property in the U.K.In effect,you are subsidising someone elses rent.Imho properties have more or less peaked and I think it will be many years before you will realise any further capital growth.How much did you pay for the villa?Why would it cost 30k + to sell it on?
  • all_hours
    all_hours Posts: 684 Forumite
    If you were living in the property you'd be paying £800 per month - but now you're paying £150 per month - is that right?
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