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Credit Card Help (SOA included)!!
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kirsty133
Posts: 4 Newbie
Hi
Both my Mum and I have been lurking on this forum for a while and been using all the advice to cut our monthly expenditure as much as possible. However we are having trouble at the moment with credit cards and are unsure what the best thing is to do.
The biggest problem is the Virgin credit card as in April the 0% period ends and becomes 28%. We understand the best thing would be for a balance transfer to a cheaper rate but both of us are finding that we are unable to get new credit cards at the moment. Even if we did, we are worried we would not even be able to meet the minimum repayments. What do we do?? I have copied the SOA to look at. Any help will be greatly appreciated!!!!
Kirsty (and Mum)
Household Information[/b]
Number of adults in household........... 2
Number of children in household.........
Number of cars owned.................... 2
Monthly Income Details
Monthly income after tax................ 754
Partners monthly income after tax....... 0
Benefits................................ 0
Other income.................... 877 (My contribution & widow pension)
Total monthly income.................... 1631
Monthly Expense Details
Mortgage................................ 580
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 168
Electricity & Gas............................. 103
Oil..................................... 0
Water rates............................. 37.76
Telephone (land line) & Internet................... 25
Mobile phone............................ 13.01
TV Licence.............................. 12.37
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 200
Clothing................................ 0
Petrol/diesel........................... 40
Road tax................................ 0
Car Insurance........................... 31.52
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 13.45
Contents insurance & Building...................... 28.4
Life assurance ......................... 0
Other insurance......................... 9.27
Presents (birthday, christmas etc)...... 30
Haircuts................................ 0
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Pet Food................................ 20
Total monthly expenses.................. 1311.78
Assets
Cash.................................... 0
House value (Gross)..................... 200000
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 200000
Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 55000....(580)......6.09
Total secured & HP debts...... 55000.....-.........-
Unsecured Debts
Description...............Debt......Monthly...APR
Santander................2529......25........0
Virgin...................5627......170.......28(Currently 0% and £76 monthly)
Asda.......................2539......58.18.....17.8
Total unsecured debts....10695.....253.18....-
Monthly Budget Summary
Total monthly income.................... 1,631
Expenses (including HP & secured debts). 1,311.78
Available for debt repayments........... 319.22
Monthly UNsecured debt repayments....... 253.18
Amount left after debt repayments....... 66.04
Personal Balance Sheet Summary
Total assets (things you own)........... 200,000
Total HP & Secured debt................. -55,000
Total Unsecured debt.................... -10,695
Net Assets.............................. 134,305
Both my Mum and I have been lurking on this forum for a while and been using all the advice to cut our monthly expenditure as much as possible. However we are having trouble at the moment with credit cards and are unsure what the best thing is to do.
The biggest problem is the Virgin credit card as in April the 0% period ends and becomes 28%. We understand the best thing would be for a balance transfer to a cheaper rate but both of us are finding that we are unable to get new credit cards at the moment. Even if we did, we are worried we would not even be able to meet the minimum repayments. What do we do?? I have copied the SOA to look at. Any help will be greatly appreciated!!!!
Kirsty (and Mum)
Household Information[/b]
Number of adults in household........... 2
Number of children in household.........
Number of cars owned.................... 2
Monthly Income Details
Monthly income after tax................ 754
Partners monthly income after tax....... 0
Benefits................................ 0
Other income.................... 877 (My contribution & widow pension)
Total monthly income.................... 1631
Monthly Expense Details
Mortgage................................ 580
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 168
Electricity & Gas............................. 103
Oil..................................... 0
Water rates............................. 37.76
Telephone (land line) & Internet................... 25
Mobile phone............................ 13.01
TV Licence.............................. 12.37
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 200
Clothing................................ 0
Petrol/diesel........................... 40
Road tax................................ 0
Car Insurance........................... 31.52
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 13.45
Contents insurance & Building...................... 28.4
Life assurance ......................... 0
Other insurance......................... 9.27
Presents (birthday, christmas etc)...... 30
Haircuts................................ 0
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Pet Food................................ 20
Total monthly expenses.................. 1311.78
Assets
Cash.................................... 0
House value (Gross)..................... 200000
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 200000
Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 55000....(580)......6.09
Total secured & HP debts...... 55000.....-.........-
Unsecured Debts
Description...............Debt......Monthly...APR
Santander................2529......25........0
Virgin...................5627......170.......28(Currently 0% and £76 monthly)
Asda.......................2539......58.18.....17.8
Total unsecured debts....10695.....253.18....-
Monthly Budget Summary
Total monthly income.................... 1,631
Expenses (including HP & secured debts). 1,311.78
Available for debt repayments........... 319.22
Monthly UNsecured debt repayments....... 253.18
Amount left after debt repayments....... 66.04
Personal Balance Sheet Summary
Total assets (things you own)........... 200,000
Total HP & Secured debt................. -55,000
Total Unsecured debt.................... -10,695
Net Assets.............................. 134,305
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Comments
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Hi Kirsty133, didn't want to read and run. Well done for posting. I lurk more than join in, but from a brief look at your SOA I'd comment on the following:
What type of mortgage do you have, as that seems high? Could you transfer to interest-only for a while?
Have you looked into getting a water meter fitted? It may save some money if there's just two of you. Also, check price comparison sites for a cheaper deal on your gas & electricity (and don't forget about cashback, if appropriate), as you are paying a lot - is one of you home throughout the day?
You should be able to cut back a bit on groceries by dropping a brand / batch cooking / going to Aldi/Lidl, etc., but you're already doing OK if it's really £200 for you both and you're not adding to it with lunches at work/coffees, where the spending seems too small to add up.
If the £40 petrol is for both cars, do you really need 2? You've put nothing in for road tax or vehicle maintenance/MOT, so suspect a spending diary would be a good thing for you to try to keep track of where all the 'spare' cash goes.
Right now, you cannot afford £30 per month for presents, so ditch this for the time being. I won't comment on the almost £30 per month on the pet/s, as I would go hungry and naked before I reduced the level of care or nutrition mine receive.
As you and your mum already know, there are loads of wonderful people on here, so others will be along with more constructive advice, but good luck: you WILL sort it out!Let us all be happy, and live within our means,
even if we have to borrer the money to do it with.
Artemius Ward (Charles Farrar Brown) 1834-1867 (Bad advice!)0 -
Is there any chance either of you could earn more? Overtime or a second job?LBM: 22.12.2010 :j Self-managed DMP start 29.1.2011DMP Mutual Support Thread No: 4130
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Does your Mum qualify for any benefits?
Might be worth checking.0 -
Is this a case where the golden rule of not turning unsecured into secured debt can be broken?
The OP has substantial equity in the house, a relatively small amount of debt, but highish mortgage repayments.
A mortgage shake-up might be in order with the aim of releasing some money for debt repayments, and reducing the mortgage repayment itself.
This should put more money into the OP's budget to avoid her running up the cards in future.
A compromise might be to add only £5K to the mortgage to pay off Virgin, and put the current Virgin payments towards paying off the other cards.0 -
Hi
Thank you for all your replies!!
I know the mortgage payments are particularly high. I don't fully understand her mortgage but I do know for some reason it cannot be changed and actually in September the monthly payments will be increasing. I will check with her though.
Our house is actually up for sale at the moment as she wants to move to a smaller place both to feel financially better but also as my brother is no longer living at home and at some point I will also move out it, the house seems so big! But in the meantime whilst we are trying to sell, these debt payments won't go away.
We've gone down the benefits line before I think. My Mum is a widow and receives a pension. She has investigated, but didn't find anything extra she was entitled too. Overtime/extra work is just not possible at the moment as my Nan is in hospital and have just no time left over.
I've just got off the phone to someone at National Debtline. They suggest writing to the credit cards with a budget sheet and a pro rata offer. Or use a free debt management plan. They were helpful but I've just been bombarded with information. It's hard to know what the best thing is to do!!0 -
...They were helpful but I've just been bombarded with information. It's hard to know what the best thing is to do!!...
Yes, that's the internet for you, always a danger of drowning in a sea of information.
You've recognised that, which should help you make considered decisions.0 -
If you start making part payments towards your debts as indicated by National Debtline - this can be a good solution but it will damage your credit rating. Given that you hope to sell I think I would consider putting the mortgage on interest only for a while in preference to ruining my credit rating especially as it is a short term option while you sell.
Have you tried applying for any 0% cards/low interest deals? whilst your credit rating is o.k?
At the moment you are showing a surplus of 66 a month after the virgin cards go up but this is missing areas of expenditure like clothes, car costs etc which are not sustainable in the longer term but you might be o.k in the very short term - say a couple of months maximum.
Gas and electric look very high as well - hopefully you can cut these down a bit now summer is coming unless you have massive arrears on them or are you building up a massive credit - you need to check this out.
dfMaking my money go further with MSE :j
How much can I save in 2012 challenge
75/1200 :eek:0 -
I forgot to say you need to find out how much you expect the mortgage to jump in September as you could get some decent credit card deals but if you can't shift the house and you can't go interest only or take a mortgage payment holiday then you will inevitably default on the credit cards and so there is little point taking out cheap credit cards if there is a chance you won't be able to pay them back.
dfMaking my money go further with MSE :j
How much can I save in 2012 challenge
75/1200 :eek:0 -
Silly question - but what do you mean by putting the mortgage on interest only? Would the monthly payments just be the interest?
My Mum doesn't seem to be able to take out any new cards at the moment. I have managed to take a 0% BT card with RBS so can take £1900 from her Virgin but its the minimum amount that needs to be paid back that worries me.0 -
Hi Ya
Interest only means that only the interest part of the mortgage is paid
Your mother at present be on a repayment mortgage which means part of the payment is to 'repay' the loan and part is to repay the interest on the loan
Just to give you an idea my repayment (inc interest) was just short of £600pm but when I went to interest only for a period I found that I was paying about £100 less - it will take me longer to pay the mortgage off but it gave me some breathing space
Some companies also offer a payment holiday - this depends on how long you have paid it but with my lender for every 9 full months you can take a 1 month payment holiday (this gets added to the end of the loan)
might be worth your mum having a word with her mortgage company - they should be able to give her the interest only payment over the phone and you could look at this alongside your SOA before you made a decision
HTHTwenty years from now you will be more disappointed by the things that you didn't do than by the ones you did do. So throw off the bowlines. Sail away from the safe harbour. Catch the trade winds in your sails. Explore. Dream. Discover."Official DFW Nerd 1365
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