New relationship - bad debt "baggage"

HardWorkingMum

Hey All,

DMP for a year - ends 2015
Neg equity mortgage (-about £30k)

Both of the above were "run up" with my fiance of 11 years - we broke up 6 months ago and I have taken on the house, DMP, sole responsibility for childcare etc. Ex was a full time stay at home dad with no income so makes sense. However, now I have met someone new, and although it is early days and I have been completely honest about my finances, he understandably worries about them.

It also appears that the Ex was a greater drain on the bank balance than I had realised as I have has much more disposable income in the last 6 months dispite helping to support him until he finds work (he has, and starts this week )

So... I reckon I should have between £2-300 per month extra to pay off debt, but am confused about what to pay 1st. The neg equity mortgage is negative by about £30k, but as Ex's name is still on the deeds I am reluctant to pay this off. Would be nice to clear the DMP asap (2 years instead of 4?) and this would re-assure the new partner that I am not as much of a financial "risk" as he thinks.


This has come about because we had a conversation about where we see ourselves in the future. Talked about keeping my house (because of neg equity) and renting it out and buying together.... However, I'm not sure he appreciates just how bad my credit rating is and how negatively the DMP is viewed by mortgage lenders.

What can I do to minimise the impact all of this will have on my future?? Should I just focus on paying off the DMP as quickly as possible?

Any advice / suggestions gratefully appreciated.

Thanks

GeorgieFTB

Mmmm... If I was you I would clear the DMP as fast as possible, once you only have the negative equity to worry about then you can have any disscussions about the fate of the house you need.

I think you need to have a proper discussion with the shiney new man. He probably doesn't quite understand what your position is. It would help him to explain when your projected debt free date is, and what the revised timings are with the extra you can throw at your debts. You will also need to let him know when any defaults come off your credit report. Reassure him that you are dealing with the issues but that you won't have a clean record for a while...

Gx

DEVONLIFE_2

Hi HWM
I would say divide the additional income amongst your creditors and get rid of your debts earlier. This will give you more disposable income quicker!
DL

RAS

Any of the creditors still charging interest? Any account close to being paid off and worth trying a full and final?

edinburgher

I'm a little confused - did you say you were helping to fund new man until his job started, but he's questioning your finances? If so, seems a bit off.

HardWorkingMum

Thanks for the comments

I logged on to the DMP online today for the 1st time. The "shiny new man" would be impressed at the eyes open approach... we spent Saturday evening building an income / expenditure spreadsheet for me (he has one!) which is when I realised I should be paying off more than I am!

A couple of the smaller creditors are close to being able to "full and final" is it best to do this through CCCS or direct?

Thanks,
HWM

Cyril

The first thing that struck me is irrespective of your financial circumstances a new relationship should be about friendship / love not a business transaction.

So what if you're in debt, its not through some addiction like gambling its just called ' life'. Negative equity is a victim of circumstance not something you have set out it achieve.

You are doing something about your debt but my concern would be a new partner who seems unduly interested in your financial situation.

If this relationship is too last surely its what you can achieve together not who brings what to the table.

edinburgher

A couple of the smaller creditors are close to being able to "full and final" is it best to do this through CCCS or direct?

When I was in a DMP, some of the DMP charities weren't willing to make !!!!!! offers unless you split the money between all creditors (this may have changed). If it's still the same, I'd probably pay off the smaller creditors yourself and contact CCCS to explain that you will no longer be paying them and that you want to re-distribute payments between the remaining creditors.

HardWorkingMum

No - have been funding the Ex until he starts new job - which he does this week

The new man is very financially secure with no debt and hoping to pay off his mortgage in the next 4 - 5 years which is why I can understand his concern.

HardWorkingMum

Cyril wrote: »

The first thing that struck me is irrespective of your financial circumstances a new relationship should be about friendship / love not a business transaction.

So what if you're in debt, its not through some addiction like gambling its just called ' life'. Negative equity is a victim of circumstance not something you have set out it achieve.

You are doing something about your debt but my concern would be a new partner who seems unduly interested in your financial situation.

If this relationship is too last surely its what you can achieve together not who brings what to the table.

I totally agree and the first few months have been all about friendship and fun... and still are. But given he has never been in debt and is looking to pay off his mortgage in the next 5 years I can understand that my financial situation is a bit daunting to him. He lives by the "your debt is my debt" rule (which I have insisted it isn't) but realistically it will have an impact on the joint financial situation in the future.

I just want him to see that I am serious about making a dent in the debt and clearing it as quickly as possible. This isn't something he has insisted I do at all.

edinburgher

The new man is very financially secure with no debt and hoping to pay off his mortgage in the next 4 - 5 years which is why I can understand his concern.

Fair enough, I had misread.

I just want him to see that I am serious about making a dent in the debt and clearing it as quickly as possible. This isn't something he has insisted I do at all.

I think you're making a sensible choice. While opposites often attract, I've found that couples with shared goals and outlooks (and banking temperaments) do much better than those where there's a spendthrift/saver clash!