Enormous debt - advice needed

hypno06

Facing the true extent of the problem is tough to do, but it is a necessity. The main thing is to be completely honest with what you are spending and what you really NEED rather than are in the habit of WANTING.

I would suggest the following:

Reduce your monthly grocery shop by half. This should be the easiest thing to do. Enjoy shopping around - you can still buy good quality food and make delicious meals without breaking the bank any further.

The figures for gas and electric sound extortionate. Again, I reckon you can reduce this by about half. Go to USwitch to see what you can do.

We refused to go bankrupt (I was a stockbroker so understand your professional concerns) but if you look on the Payplan website, they will give you loads of info (although I am sure you know it already, but sometimes it does us good to be reminded) eg if you go for an IVA or DMP, your ability to be company director etc is not affected. There are alternatives to bankruptcy.

School fees - whilst wanting to do the best for the children. Sometimes you have to get real. Any creditors etc are not going to look kindly on the issue of school fees when working out what you can afford to repay them. Is this really the only alternative. Even home schooling could be an option if your wife is currently not working.

Coming to which, can your wife get a job once you have moved?

Hope some of the above helps. We are all in it together, and very few will judge you in a negative way - we have all made mistakes and most of us should know better!!

bonnie_2

How are you proposing to pay £700 a month for schooling on your income and debt level. when your other income isn't guaranteed.
i think i would home educate, your going to get in a real mess with finances going down that route. I feed 5 on £200 a month.

hypno06

Regarding the schooling issue - surely if the local schools are full then the LEA have an obligation to provide transport to the next available school. This happened to us and my son is picked up by a taxi every day because the local school is oversubscribed.

Worth looking into?

angelavdavis

Hi Bunyip, sorry to hear about your situation, posting here has got you started on the road to recovery.

My tuppence worth:

Have you included everything in your SOA? What about the following:

Mobile and other phone
TV Licence
Insurances
Water rates

I am unclear why your wife needs to leave her job when the new job starts - the salary (as a joint salary) even with accommodation is very very low even if you didn't have the debts. Could your wife not find alternative employment?

I think you should look at Martin's SOA template to see if there is anything else you have missed.

You then need to start looking at the interest rates for the debts. Again, there is a template for this which I suggest you use and post.

You should also seek advice from the Citizens Advice Bureau as a starter, they can explain the options for you.

lynzpower

Can I ask why you have taken a job at only 5k per annum.

To be honest, youd make more than that in Mcdonalds.

Im at a loss to understanding the reasoning here, maybe you could tell us more.

I have been working till recently in social work, even unqualified staff get 16k per annum, whereas a qualified worker gets upwards of 18k in the lowest paid areas. In london & the south its not uncommon to get more like 30-40k qualified.

Could you explain more?

And to regulars- would the official reciever accept the private school fees, or would they be seen as a luxury?

mjdh1957

I think it's that low because the job is live-in and includes accommodation.

Otherwise, yes it would be a ridiculously low salary.

lynzpower

mjdh1957 wrote:

I think it's that low because the job is live-in and includes accommodation.

Otherwise, yes it would be a ridiculously low salary.

thats what I thought but then also thought that lets face it, accomodation ISNT that expensive. I certainly dont pay 35k per annum for my place to live, and thats surely the difference in salaries ( if the OP is working in qualified SW)

Additionally as an accountant, surely theres muhc bigger money to be made?

climbgirl

lynzpower wrote:

thats what I thought but then also thought that lets face it, accomodation ISNT that expensive. I certainly dont pay 35k per annum for my place to live, and thats surely the difference in salaries ( if the OP is working in qualified SW)

Additionally as an accountant, surely theres muhc bigger money to be made?

Yes, that was my thought too, I thought it had to be a misprint at first. Even with accomodation, that's a pittance. Someone else posted here on this board saying they had a job including all rent and bills so all they had to buy was food and entertainment and their salary was £12K.

There is a good money to be made in the accountancy field at the moment, I have a circle of friends in this sector and the market is good right now - they can't get good people for jobs. It seems madness to take a job with a salary of £5K in this climate.

I think bankruptcy is one of your only options here if there's only £75K equity in the house. As someone said you'd need at least £4400 a month to pay the minimums and that's just not feasible.

mjdh1957

True, I hadn't thought of that.

We'll need to wait until the OP comes back and lets us know the full picture.

I would imagine bankruptcy is the only answer with debts that big.

Bunyip_2

Thanks for all your responses - this is all very useful.

The new employment is 16 hours per week and includes a house and council tax as well as the £5k, so it is not a bad deal. The other consultancy work that I do (estimated at net £600 per month) uses up the rest of my time. I maybe able to fit another 10 - 15 hours doing some part time accountancy if I can find something fairly flexible to fit in around the other two jobs.

My wife will look for new work after we move in.

The £600 per month grocery amount included cleaning products, clothing, etc. for all of us. The gas and electric is based on my current bills, so I will look for something cheaper. Forgot to include telephone/internet/etc.

Instead of bankruptcy, what about coming to a full and final settlement with creditors with the lump sum from the house - they would get more than if I went bankrupt as there is not an administrator taking his cut?

I have read the thread about full and final settlement and from that it doesn't appear too hopeful, but perhaps I could try that and if that didn't work then go the bankruptcy route (although there would possibly be even less money for creditors with a delay).

Can unsecured creditors force me into bankruptcy?

Thanks again for all your help.