Don't know where to start, lost cause I think - please help me.

DVardysShadow

beanielou wrote: »

Well I think its unrealistic to pay back 35k unsecured debt on the income you have with your essential expenditure.
At the end of the day the decision is yours.

And I think you are giving up far too easily.

• Repayment shortfall is £120/month
• Take home is £3230
• A loan for £683/month falls off in 18 months

So we are looking at a 4% shortfall, which can be dealt with by belt tightening. Even if it is not dealt with, a further debt accumulates to the amount of £2160 over 18 months, when there will be a surplus of £563/month [when the loan is paid off], which will wipe out the further debt in about 4 months. At this point the overall debt will be about £26000 and can be cleared in a further 48 months approx.

Bankruptcy is a totally OTT solution to the problem. Unless you have a justification which says that ditching £36000 of debt more than makes up for the extra costs of mortgaging in the future. Bankruptcy is a last resort - if it is used to ditch debt which could be paid off, thet would be plain dishonest.

beanielou

Im not going to argue with you.
Ive worked in money advice.
Have you?

DVardysShadow

beanielou wrote: »

Im not going to argue with you.
Ive worked in money advice.
Have you?

You are not going to argue with me, you are just going to pull rank?:rotfl::rotfl::rotfl: Pull the other one. As far as I am concerned, I have argued the case and people can judge the quality of my opinion on this from my argument.

Now, make a proper case for the OP going bankrupt, or stay silent, the choice is yours. But to me, it looks like a rotten recommendation and I won't be coming to you for money advice.

DVardysShadow

Anna1701 wrote: »

Thanks for your ideas guys, me and my partner are going to sit down and really cut this down.

Can I ask though, after looking at the SOA, do people think we need to consider bankrupcy or do we need to be be smarter with our money and then we can start paying more than the min payments on cc's. Then in 18 months the loan will be gone and that will be an extra £600 to pay off CCs.

For info we havent missed any payments.

The question you need to answer is can you get through that 18 months? You are about £2000 short on your current budget. Can you find that amount of savings? If you can't you will start to get defaults, which will damage your credit rating, but far less than bankruptcy. If it is all going to be too much, then you should consider bankruptcy, but it looks like something you can duck and dive through somehow.

Joanie72

Can you renegotiate the terms of your A&L loan to bring the payments down to £500 a month, thereby getting you within monthly expenditure? It's a long shot, but might help.
Meanwhile I agree with other posters here, you should be able to bring yourself in on budget with a little belt tightening. Look at your food, entertainment and fuel costs, and defo look at repackaging your TV, broadband and phone together.
Good luck, and don't despair, you're not a hopeless case!

JohnD76

Are you sure the figures for Car insurance, maintenance and Road Tax are accurate on your SOA?

You have 3 cars are are budgetting on a little over £800 a year for servicing, maintenance, MOT and TAX for all three cars.

Anna1701

Thanks for all your helpful advice everyone, i must admit when bankruptcy was first mentioned it did really put the frightners on me, it is not an option I want to go down because yes we have been reckless and yes we need to sort this out but we are only 26 & 29 - we have a long life to lead and we dont want to do it with a bad credit record and we want to eventually own our own home etc.

I am currently studying part time for my teacher training diploma and have just found out that I am entitled to £2700 as a grant (not repayable) for the next year, so that should help with the shortfall as you suggest DVardysShadow. And if we tighten our belts and make the costcutting that peeps have suggested I'm positive we can get through the next 18 months. Then that additional £600 a month can go on clearing the CC debts. This to me sounds a much positive answer and I think we will learn a valuable lesson on living within our means.

I had a horrible night last feeling sick and not sleeping after doing our SOA, but thanks to these comments this morning I am feeling alot more positive that this isn't the end of the world for me.

Anna1701

Just thought of something else I wanted to ask, I have been reading up on different forums about the different charities offering debt advice and debt management plans, but my understanding is that again this is really an option if you can't make even the minimum payments and then the interest is negotiated so you pay only you can afford. Again I dont think this is the right option for me for the same reasons as above and it will take longer to pay off the debt.

Have I got this right?

ladybez

DMP's do appear to be for perople who are unable to make minimum repayemnts of CC's etc. Also although the actual amount payable to each CC can be reduced, some compainies still continue to add interest and by makein reduded payments you are actually breaking the terms of you agreements, which may well lead to CC companies registering defaults, which as has already been said will affect you credit rating for about 6 years. So if you are able to repay the minimum amounts, your credit record is better and you will stand a better chance of getting a mortgage in the future. Looking at your SOA, if you can rein in your spending for the next 18 months, things will be better for you. My feeling is that that will be your best option. Good lukc with whatever you decide and keep posting

NorthernLas

Read Martin's article on debt checklist, you have problems but are not in debt crisis assuming your SOA is correct. Also you can put the figures into the CCCS debt remedy and get advice without taking up a debt charities time.

http://www.moneysavingexpert.com/loans/debt-help-plan#checklist
https://debtremedy.cccs.co.uk/