£50k debt please help me - I need to get my life back in order.

Murph2010

Hi and many thanks for reading. To cut a long story short I was in a relationship where my ex partner and I got into a high amount of debt, initially this was due to living beyond our means but then the credit was used to live on and in fairness to myself I tried to make a change and put a stop to it but problems in the relationship didnt help. We split up 3 years ago but its myself who has the debt as it was in my name.
Luckily I have now met someone new and I need to get this debt sorted before it gets serious. I want something in place so I can see how long the journey will last to paying this off.

The details. Essentially I have 5 credit cards (none of which I have used or had possession of for 4 years) with an outstanding balance of £22,000. I am in agreements with all of these and pay between £20 and £55, paying a total of £160. The problem with this is that every 3-6 months this gets increased and I am not making any significant dent in the debt, it will take forever at these levels to pay off.
There is also a joint loan of £30,000 of which I am the first name on the loan. Like the credit cards I pay a nominal fee of £25 per month as a goodwill gesture, my ex also pays £25 per month (allegedly). This debt is actually attached to the property my ex lives at with her 3 children (I am not the father). The mortgage is in joint names although I do not pay anything on it, I live in rented accomodation. The mortgage is approx £142k, value of house would be around £165k. I believe the mortgage to not be in arrears of any kind.

I am currently managing my finances well, I only buy what I can afford to buy, I am employed but as I say I want to solve and clear this debt now. I am willing to make sacrifices as I want a fresh start with my new partner and to have this dealt with and a date in the future where things will be paid off.

The world of IVA and bankruptcy is mind boggling and I ask for your help today in enabling me to have a future.

Kind regards

Nargleblast

Hello Murph and welcome. Looks like you have just had your lightbulb moment!
Yes, you are in a fair amount of debt but there will be a solution to it, you just have to find the right one. Whether it is IVA, Bankruptcy, Debt Management Plan or sorting it out yourself, one thing is certain - you need to know where you are starting from. I would recommend going over to the Debt Free Wannabe board, looking at the First time posters sticky at the top of the list which tells you how to do a SOA (statement of affairs). This is a way of writing down all your monthly income and expenditure, plus details (amounts, interest rates) of your debts. Then if you post it as a new thread on that board people will help with suggestions on how to cut your costs, maybe increase income, and if appropriate which debt to tackle first. You will then be able to use those figures to discuss your situation with a debt counselling firm (there are a few which will not charge you for the privilege of giving you advice, CCCS and Payplan are two that come to mind). Then hopefully it will become clearer which solution would be the best for you. Come back to the IVA board if you decide an IVA is the way forward, or the Bankruptcy board if that is the one. At the end of the day it does not matter which solution you choose, as long as you stick to it and make it work. Good luck and keep in touch.

byebyedebt

Hello Murph,

My understanding from your post is that you are already in arrangements to pay your debts. I presume therefore you are not paying any interest on the loans, but because you are paying a little bit at a time, the debts are not going down fast. I know that can be very depressing but their are options. As long as the payments are interest free, keep on making them.

So you are not living in the house but your partner is paying the mortgage but your not sure. My concern, would be that your Ex is in arrears, or about to be repossessed. First of all, I would tackle this. If your name is on the mortgage you are entitled to receive a copy statement free of charge to your address. Contact the bank, and adddress this, by checking that they are receiving the payments, and making sure you get a copy of the statement.

Once you know where you are with the mortgage, it might give you some assurance.

If everything is ok with the mortgage why dont you see if you can sell the house to your partner. If the house is worth £165, well lets say 160K, you partner could potentialy pay you up to £80K for your share. Take away the half for the debt, down to 65K. Take away 22k for your debts and you will be left with 43K. Is that not a possibility?

The other option you could consider is selling some of your share to your partner. If the house is worth 165K, every ten percent of the house is worth 16.K. If you were to see a solicitor and agree to sell two fifths of your share (20% of the total value) to your ex, that would get you 32K. Almost enough to pay all your debts. It may sound complicated, but it is possble to do if parties are in agreement.

stebiz

byebyedebt wrote: »

Hello Murph,

My understanding from your post is that you are already in arrangements to pay your debts. I presume therefore you are not paying any interest on the loans, but because you are paying a little bit at a time, the debts are not going down fast. I know that can be very depressing but their are options. As long as the payments are interest free, keep on making them.

So you are not living in the house but your partner is paying the mortgage but your not sure. My concern, would be that your Ex is in arrears, or about to be repossessed. First of all, I would tackle this. If your name is on the mortgage you are entitled to receive a copy statement free of charge to your address. Contact the bank, and adddress this, by checking that they are receiving the payments, and making sure you get a copy of the statement.

Once you know where you are with the mortgage, it might give you some assurance.

If everything is ok with the mortgage why dont you see if you can sell the house to your partner. If the house is worth £165, well lets say 160K, you partner could potentialy pay you up to £80K for your share. Take away the half for the debt, down to 65K. Take away 22k for your debts and you will be left with 43K. Is that not a possibility?

The other option you could consider is selling some of your share to your partner. If the house is worth 165K, every ten percent of the house is worth 16.K. If you were to see a solicitor and agree to sell two fifths of your share (20% of the total value) to your ex, that would get you 32K. Almost enough to pay all your debts. It may sound complicated, but it is possble to do if parties are in agreement.

I agree about the statements, but if I read the post correctly, they have a mortgage of 142k??

byebyedebt

stebiz wrote: »

I agree about the statements, but if I read the post correctly, they have a mortgage of 142k??

Whoops a slight miscalculation.

But still workable as the mortgage is joint with her ex and she does not live there. The debt wont be the OPs if they can sell their share to the Ex. Remember the OP is not living in the house, nor paying any of the mortgage.

The mortgage is neither here or there if she no longer has it. That is where the 80K comes from. By selling her share. That will then wipe out her mortgage debt. That leaves 15K for the debts. Balance remaining 7K. A lot easier to deal with.