Help please !!!

lastkiss

Newbie here, been getting newsletter for a while but new to forum, reading around everyone seems lovely and helpful so here I am looking for advice and encouragement. Becoming sick with worry over my financial situation recently.
I am in full time employment but been off sick since Sept after having a breakdown as a result of a family bereavement. My wage was never great but am now on basic sick pay, varies from 2 - 300 per month. I have 4 kids, debts and mortgage, they would as well be giving me nothing it goes nowhere. Hubby works full time too but on very poor wage.
As a result I have been re-mortgaging, taking out loans and using credit for everything. This started before I was sick as wages were so low, however at least we were earning enough to keep the wolf from the door.
I have made a positive step (I hope, advice on this much appreciated). I have an appointment with an independent financial advisor on Monday am. I intend to see if I can merge all my debt onto mortgage. Maybe have to extend term and definitely will have to change from capital and interest payment to fixed term interest only, but at least will then hopefully have a bit less outgoings per month.
Not sure how people have debts listed seperately at bottom of post so just list mine here as best I can.

Incoming:- wages 1,300, tax creds 450, fam all 120 - total £1900 approx.

Outgoing:- mortgage 350, personal loan 350, cc 100, next acc 100, household bills car etc 500, food 400 - total £1,800.

Next account balance 1,500 :eek:. CC balance 3,700:(. Have been using both for all essentials, food, clothing, xmas etc, as no spare cash.

Is the financial advisor thing the way to go? All cred running out so panicking now - I have a 1,500 overdraft that I pay £1 a day when using, that is maxed . I dont know what else to do.

Am also looking at ways to make some more money. Have joined all survey/mystery shopper sites, am sorting through stuff to ebay and am looking at ways to cut household bills.

Any advice would be very very gratefully received. xxx

LMCD

someone will no doubt tell you post a proper SOA... maybe you just need to get alot of things 'cancelled' so you can't use them further and request them to take a reduced payment and postpone or completely freeze interest in order to enable you to pay them off, there are template letters on national debt line on the web.

Can you shop cheaper than next? I know clothing kids isn't cheap...but there is cheaper than next.

Trying to get out of debt myself. GL!

Superbiatch

Beware that by going on a DMP (debt management plan) you will end up with defaults which will stay on your credit record for 6 years making further credit impossible. But seeing what you've said I think you've probably exhausted all your credit options anyway as banks don't lend too easily these days

By putting the extra on your mortgage, you are effectivly turning unsecured debt into secured debt - is it worth risking losing your home over credit card bills?

If you do an SOA (as mentioned above), we can see your income and outgoing which will highlight what is left for debt repayments - ok your credit rating will be shot for 6 years, but you are much less likely to lose your home over some unsecured debt which will be paid back at an amount you can afford, and hopefully your creditors will freeze interest and charges. It will also highlight any areas which you are overspending and savings could be made.

Also, by speaking to one of the companies who don't charge like CCCS or Payplan, they can advise your best step forward.

Hope that helps x

lastkiss

Thank you both of you, have tried my best to be as accurate as poss on this form, online banking down but figures close to true.
Yeah I completely agree LM next so expensive but I have absolutely no cash and only one credit account - with them. Has been invaluable xmas and birthdays and when kids need clothing, unfortunately has to be paid back

Hope this works...

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 3
Number of children in household......... 2
Number of cars owned.................... 2
Monthly Income Details
Monthly income after tax................ 260
Partners monthly income after tax....... 1040
Benefits................................ 420
Other income............................ 0
Total monthly income.................... 1720
Monthly Expense Details
Mortgage................................ 350
Secured/HP loan repayments.............. 350
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 120
Electricity............................. 60
Gas..................................... 70
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 25
TV Licence.............................. 12
Satellite/Cable TV...................... 60
Internet Services....................... 0
Groceries etc. ......................... 450
Clothing................................ 50
Petrol/diesel........................... 40
Road tax................................ 10
Car Insurance........................... 35
Car maintenance (including MOT)......... 30
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 6
Pet insurance/vet bills................. 0
Buildings insurance..................... 15
Contents insurance...................... 15
Life assurance ......................... 13
Other insurance......................... 0
Presents (birthday, christmas etc)...... 80
Haircuts................................ 6
Entertainment........................... 30
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1827

Assets
Cash.................................... 0
House value (Gross)..................... 120000
Shares and bonds........................ 0
Car(s).................................. 1500
Other assets............................ 0
Total Assets............................ 121500

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 65000....(350)......0
Secured Debt.................. 15000....(350)......0
Total secured & HP debts...... 80000.....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
credit card....................3700......100.......0
next account...................1500......100.......0
overdraft......................1500......0.........0
Total unsecured debts..........6700......200.......-

Monthly Budget Summary
Total monthly income.................... 1,720
Expenses (including HP & secured debts). 1,827
Available for debt repayments........... -107
Monthly UNsecured debt repayments....... 200
Amount short for making debt repayments. -307
Personal Balance Sheet Summary
Total assets (things you own)........... 121,500
Total HP & Secured debt................. -80,000
Total Unsecured debt.................... -6,700
Net Assets.............................. 34,800

Reproduced on Moneysavingexpert with permission, using IE browser.

So there is no point seeing the financial advisor on Monday? I would really rather try to reduce my spending for now and get by than be bankrupt or something equally scary. Hopefully I will be able to return to work soon then things should get a lot easier to manage as long as we continue to be really careful.

Superbiatch

You say there are 3 adults living in your household - is one your oldest child? Can they contribute to the bills at all?

Also, you could make savings in the areas of birthdays and clothing, even if only for a short period of time to make up a shortfall. You could probably shave a bit off groceries too using ideas from the old style saving forum http://forums.moneysavingexpert.com/forumdisplay.php?f=33

Internet and cable tv could be lowered, maybe see if they will do you a deal?

You really should have something in emergency fund for washing machine breakdown etc Even if its only a small amount.

Do you see your sickness being a long term thing whereby you might get finished up? Or are you planning to go back? Are your employers being supportive?

LMCD

lastkiss wrote: »

Thank you both of you, have tried my best to be as accurate as poss on this form, online banking down but figures close to true.
Yeah I completely agree LM next so expensive but I have absolutely no cash and only one credit account - with them. Has been invaluable xmas and birthdays and when kids need clothing, unfortunately has to be paid back

Hope this works...

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 3
Number of children in household......... 2 thought u had four kids?? is one of adult age?
Number of cars owned.................... 2 are two essential?
Monthly Income Details
Monthly income after tax................ 260
Partners monthly income after tax....... 1040
Benefits................................ 420
Other income............................ 0
Total monthly income.................... 1720
Monthly Expense Details
Mortgage................................ 350
Secured/HP loan repayments.............. 350
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 120
Electricity............................. 60 who is elec and gas with? have u looked at dual fuel? what size of house and type heating do you have?
Gas..................................... 70
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 25
TV Licence.............................. 12
Satellite/Cable TV...................... 60
Internet Services....................... 0
Groceries etc. ......................... 450 where do you shop and how often do you go shopping
Clothing................................ 50
Petrol/diesel........................... 40 this is quite low for two cars are you sure?
Road tax................................ 10
Car Insurance........................... 35
Car maintenance (including MOT)......... 30
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 6 have you checked if you qualify for help for this? check out health prescriptions help for payment costs
Pet insurance/vet bills................. 0
Buildings insurance..................... 15
Contents insurance...................... 15 maybe this combined you could save a couple of quid, a couple of quid ain't grand but could be towards a debt
Life assurance ......................... 13
Other insurance......................... 0
Presents (birthday, christmas etc)...... 80 this is alot..do you have a big family? do you buy presents/gifts in advance when you see a sale or owt?
Haircuts................................ 6
Entertainment........................... 30
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1827

Assets
Cash.................................... 0
House value (Gross)..................... 120000
Shares and bonds........................ 0
Car(s).................................. 1500
Other assets............................ 0
Total Assets............................ 121500

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 65000....(350)......0
Secured Debt.................. 15000....(350)......0
Total secured & HP debts...... 80000.....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
credit card....................3700......100.......0
next account...................1500......100.......0
overdraft......................1500......0.........0
Total unsecured debts..........6700......200.......-

Monthly Budget Summary
Total monthly income.................... 1,720
Expenses (including HP & secured debts). 1,827
Available for debt repayments........... -107
Monthly UNsecured debt repayments....... 200
Amount short for making debt repayments. -307
Personal Balance Sheet Summary
Total assets (things you own)........... 121,500
Total HP & Secured debt................. -80,000
Total Unsecured debt.................... -6,700
Net Assets.............................. 34,800

Reproduced on Moneysavingexpert with permission, using IE browser.

So there is no point seeing the financial advisor on Monday? I would really rather try to reduce my spending for now and get by than be bankrupt or something equally scary. Hopefully I will be able to return to work soon then things should get a lot easier to manage as long as we continue to be really careful.

I can see your point regarding clothes and no cash, is there anyway you can open up a credit union to start doing a small pot to save for things such as birthdays and clothes? It is a decent way of borrowing and you still have your savings left after borrowing, they use it to secure your lending.

Credit unions can also offer debt and budgeting advice, you could probably be seen quicker than a CAB office as I know they can be so mega busy.

lastkiss

Hi Super thank you for your advice. Have started being more frugal with my food shopping, cooking everything from scratch. Older daughter still living at home is 17, she was at uni but discovered at xmas she was expecting a baby, so quit and came home . She has no income as too young for most benefits, and cant find work.
As for me I really don't know when I will be able to go back to work, I think I need to consider a career change as work with vulnerable people and death not unusual, really couldn't cope with that right now. Don't want to admit defeat though, getting councelling and hopefully will be strong enough to resume soon, fingers crossed.

LM yeah eldest daughter just moved out so just 3 kids to provide for at home, though eldest still needing help Never stops does it

I use my car for work, but hubby has work van and could easily do without his car, trouble is he doesn't know how bad our financial situation is. I deal with all household finances, and really don't want to have to tell him we are failing as he works so hard .

Pressie budget is high but this takes xmas into account too and yeah lots of nephews as well as my own to buy for. Not much just a token but all adds up. Again can't take advantage of advance buying in sales as no spare cash.

Credit union a great idea I will look into it, hopefully there will be one in my area. Thanks for that advice. Went on to CCCS website and did the debt questionnaire, they have recommended a DMP but I will only go there if it is my last resort, I need to try to get out of this by myself.


All advice so greatfully received thanks everyone xxx

Superbiatch

lastkiss wrote: »

As for me I really don't know when I will be able to go back to work, I think I need to consider a career change as work with vulnerable people and death not unusual, really couldn't cope with that right now. Don't want to admit defeat though, getting councelling and hopefully will be strong enough to resume soon, fingers crossed.

I use my car for work, but hubby has work van and could easily do without his car, trouble is he doesn't know how bad our financial situation is. I deal with all household finances, and really don't want to have to tell him we are failing as he works so hard .

Pressie budget is high but this takes xmas into account too and yeah lots of nephews as well as my own to buy for. Not much just a token but all adds up. Again can't take advantage of advance buying in sales as no spare cash.

All advice so greatfully received thanks everyone xxx

OK, so budget looks like it could be long term so savings need to be made.

Its time to let your husband in on the secret - it won't be easy and you'll probably feel responsible but the truth is this is stress you are carrying on your own, and can do without. If he knows the score, the car can go saving a few £ each month at least until you're back at work. Its such a burden to carry, a problem shared and all that. He can't be that oblivious to it as you've tightened your belts recently so he knows things are tight. How much is the car worth?

Maybe now is also a good time to speak with the family regarding presents. Thats another burden you can do without. Maybe have a maximum spend per child? In these lean times I bet your relatives would appreciate some extra cash? Don't go into details, just explain while you're off work things are a bit tighter than normal.

Do you really feel adding your debt to your mortgage will make it more manageable? I'm sure a financial adviser will advise you it is as its in their interest, but if you speak to CCCS I'm sure they'd advise otherwise. Its not that much and you could probably clear it in a year or two when you find a new less stressful job.

x

lucielle

Well you've made a step in the right direction, posting is always pretty scary. Please consider looking at the CCCS website before you see your financial adviser. This is a free company and they offer all sorts of avice. They were a real lifesaver when we were at the beginning of our journey. They don't judge you and can help with DMPs, though we decided to do it ourselves. Have a look on the old style boards to help with the grocery budget.

Also do tell your other half, yep he's going to be gutted but it will make it easier if you both know the situation. HTH and best of luck.
L

[Deleted User]

Hi lastkiss, I really feel for you. sickness has made your situation so much worse. I am pretty new to the forum but wanted to tell you how supported I have been since posting and how much excellent advice I have recieved.

After reading many threads over recent months, the impression I get is that increasing your mortgage would be increasing your secured debt, so if your situation stays the same or another unexpected problems crops up like OH being sick you could risk losing your home. From what I've read a DMP, although seems like your defeated is a much safer way of dealing with your debt- they cant touch your house.

Financial advisors will mostly offer you options like increasing your mortgage or consolidating your loans because its how they get paid.

Please, please think seriously about this first, I have consolidated my debts in the past by putting on my mortgage, feeling that 'a weight had been lifted off', however as you see from my signature, my debts have continued to spiral and now in a situation where I might be in negative equity (currently trying to get onto a better mortgage deal, not to add to mortgage but to get a better deal to pay extra off debts).

Will be thinking of you and will suscribe to your thread to see how your getting on, keep posting, it does give you motivation. Look at the old style threads and start menu planning and writing strict shopping list to budget. My grocery shop has gone from appro £120 per week to approx £40 per week and I can honestly say we are eating better.

When I started I felt miserable and that I would be 'missing out' on the nice bits from the supermarket however now I've got hubbie on board its become a bit of a challenge and lots of fun (might sound sad). In fact, feel gutted if I have to spend money (anyone who knows me would die of shoch at my last statement).

Good luck lastkiss, please think seriously about seeing that financial advisor x

LMCD

lilykins wrote: »

Hi lastkiss, I really feel for you. sickness has made your situation so much worse. I am pretty new to the forum but wanted to tell you how supported I have been since posting and how much excellent advice I have recieved.

After reading many threads over recent months, the impression I get is that increasing your mortgage would be increasing your secured debt, so if your situation stays the same or another unexpected problems crops up like OH being sick you could risk losing your home. From what I've read a DMP, although seems like your defeated is a much safer way of dealing with your debt- they cant touch your house.

Financial advisors will mostly offer you options like increasing your mortgage or consolidating your loans because its how they get paid.

Please, please think seriously about this first, I have consolidated my debts in the past by putting on my mortgage, feeling that 'a weight had been lifted off', however as you see from my signature, my debts have continued to spiral and now in a situation where I might be in negative equity (currently trying to get onto a better mortgage deal, not to add to mortgage but to get a better deal to pay extra off debts).

Will be thinking of you and will suscribe to your thread to see how your getting on, keep posting, it does give you motivation. Look at the old style threads and start menu planning and writing strict shopping list to budget. My grocery shop has gone from appro £120 per week to approx £40 per week and I can honestly say we are eating better.

When I started I felt miserable and that I would be 'missing out' on the nice bits from the supermarket however now I've got hubbie on board its become a bit of a challenge and lots of fun (might sound sad). In fact, feel gutted if I have to spend money (anyone who knows me would die of shoch at my last statement).

Good luck lastkiss, please think seriously about seeing that financial advisor x

Very good advice there.

re the cred union it seems it comes under Forres area? 11 miles out of elgin...well I seen it on the yell website.

I really can understand what you are saying about things in alot of what you say lastkiss - but you will get there!