Are we crazy

funfunder

Until a month ago I thought we were doing ok. A friend had a great remortgage deal. I thought it would be a good idea to look at what was out there. Due to a lot of illness we have used our credit cards and they have now reached 69k! (yes I know but it seems to have happened over the last 8 years and I mental illness and just didnt realize) We only have a small mortgage 22k. Property value 1 230k property 2 180k. (We cant sell the second property due to a family member still living there.) Santander refused us outright saying we were almost bankrupt and needed an IVA! I explained we had never missed a payment on out mortgage and apart from a problem with one card which went into an arrangement plan last year(we were away in the USA for a few months and the DD had been cancelled in error) I paid as per the arrangement and it was brought up to date. Two other late payments in the last 6 years. We are totally up to date with all the others.

Since we started this we seem to get lots of letters from credit cards and loan companies. A call tonight connect Experian after I looked at the 'lower my bills section'. He said there was little chance of mortgage and he would try and help but gave is no hope. What can we do? I am worried sick now.:(

The_Palmist

Better see a bank adviser at the earliest. Are you looking to get a bigger mortgage and clear your huge 69K credit cards balance.

Thrugelmir

I would suggest discussing the matter openly with your partner, and formulating an action plan. There's plenty of advice and support around but the effort has to come from you.

The main stream lenders aren't going to be interested in consolidating your debts. So don't kid yourselves that you are a good risk. Just because you make repayments on time. That's the minimum requirement for managing ones personal financial affairs responsibly.

funfunder

Yes we are we are looking to remortgage. we were hoping for 100k we have income of £3800 per month. I know the cards are high but we have made the mistake now and will never do it again. We had been promissed some money which would have cleared over 3/4 but it never came!

funfunder

My husband is fully aware and we are working together to get out of this mess. We can keep on as we are but the debt not going away and we want to clear it.

Annisele

£3800 is a good monthly income, but (unless your circumstances have very recently changed) you must have been overspending to get up to a debt of £69k. I'd suggest you make a new thread over on the debt free wannabee board; there are people over there who are very good at helping you make savings.

Why are you hoping for £100k? If your existing mortgage is £22k and your debts are £69k, that makes £91k - are you in debt for another £9k somewhere else, or were you hoping to increase your debt to buy something?

funfunder

Thanks for your reply. Our income has changed dramatically. My husband nursed me for five years our income was £700 per month. Once I stabilised we sorted out our income. The extra money is do some changes to the house. They can't really wait. I havnt used a credit card in over 6 months. I will repost it. Thanks

Thrugelmir

funfunder wrote: »

The extra money is do some changes to the house. They can't really wait.

Therein lies the root of your problem.

funfunder

I need to make the house easier for me to move around. As my health declines I will need a wheelchair full-time. So it's not a luxury!

Annisele

OP - take a deep breath; I'm going to be blunt.

From a lender's perspective, you've been spending more than you earn for five years and you want to borrow yet more money. On that basis, you do not look like a good risk - you look like somebody who has never learned to budget. Whether that's true or not is irrelevant, it's how lenders will see you. So, as a lender, why should I lend money to somebody who consistently lives outside their means?

At the moment, you cannot afford to make changes to your house.

The people over on the debt free wannabee board talk about having their Light Bulb Moment, when they realise that things simply can't go on as they are and they need to make serious changes. It sounds as though you haven't quite got to your LBM, but you really need to.

It's likely that you do have options, particularly with the equity you have in the second home, but you're going to need to make some hard choices. The DFW board people are great about helping with budgeting and signposting people to debt advice charities.

handytips

Funfunder. There are a number of options available to you. Even if you dont go with a mainstream lender, the amount of money you will be saving on a monthly basis will be significant, the risk of puting unsecured to secured in your case would imo be a sensible thing to do, to pay of 69k credit cards will take you the rest of your lives. I have just done a quick search and based a £92k mortgage over 15 years on repayment (fixed) and the monthly payment comes out at £753 per month, this is not a high street lender, but a very reputable bank. I would imagine that this figure is approx a £1000 per month less than what you are paying currently. I will send you a pm with the details. Good Luck