Desperate and Scared

viv1969

Hi, this is my first time posting here, and is a desperate scream for help from my husband and I. Here’s our situation.

We moved house in March 2006. We have a mortgage of £165,000 and the house is valued at around £190,000

I am employed full time and earn £20,5000 pa.
My husband is self employed (Driving Instructor) and started his own business in August ’06. Before that he was a franchisee with a driving school but they wound up supplying him with almost NO students. Right now he has very few students and he is bringing in very very little money. Because of this we are having to take money from credit cards to pay the bills and as they’re almost maxed out it can’t go on.

We have what I consider to be horrendous debts. I have no idea how we allowed ourselves to get in this deep, but I know that dwelling on the ‘how’ won’t change the facts. We have enough on cards to cover next month and then that’s it.

In total, including credit cards, store cards (mine – guilty) one loan and the remainder of my husbands car finance we are in debt to the tune of £34,000.

We are at the end of our wits here, and I’m terrified that we’re going to lose everything.

So far we haven’t missed any payments or defaulted on anything.

We’ve looked into the possibility of a secured loan as a way of reducing monthly outgoings by a BIG margin to get us back on our feet, and then paying a chunk off of the loan once each year,, thus reducing the term.

At the moment I’m terrified because I don’t see any other options?

Am I being naïve about this?

We desperately need to reduce our payment(s) in order to give my husband’s driving school the time it needs to get on its feet.

Please, if anyone can help with advice we would SO appreciate it.

HHH_2

Hang on and very soon people will be on who will be able to help you.

bluezone

Hello and weldome to MSE,

Dont panic there are lots of us on here that will do our best to help x

Firstly could you post up a detailed SOA statement of affairs. Basilcally anything and everything that you pay out for - from a chocolate bar to your mortgage! See the top of the board for a sticky explaining it in more detail.

Do you have any clothes or items around the house that you could sell on ebay or on a car boot.

Got to pop to a meeting but I will be back x

Dumyat

you need to give the folks here all the figures so they can help you plan.
I think the most common advice here is not to consolidate loans.
Is there anyway he could take on a part time job until his driving school takes off.
isnt spring one of the busiest times for driving schools. would imagine the dark winter nights will be putting folks off at the moment.

anyway of increasing his business...adverts..special offers?

ktb

Hi Viv... sorry to hear about your situation! I have been reading these boards for a few months now and I know that there are lots of people on here who have been in your situation and can offer you lots of very helpful advice - you are not alone. You have made a great 1st step towards getting yourself sorted out
by admitting your problems on here.

You will be advised to do a full SOA (statement of affairs) listing all your incomings and outgoings... this sticky will explain all about it...**SOA** and if you then post it up some very wise people on here can help you out.

I really wish you all the best.

livinginhope

Morning viv :hello:

Welcome to DFW,try not to panic.First thing you must do is STOP USING CREDIT CARDS if you cannot make the minimum payments this month,then so beit.
Try and post a statement of affairs with all the details of income,expenditure and debts,we will then have a clearer picture of what is going on.
Have you called Payplan or CCCS about your problem? if not,it maybe you should give them a call when you have all details to hand,you will find links at the top of the board.
I wouldn't recommend a secured loan,this is making your debts secured on the house,which puts it at risk,if you keep them unsecured,your house should remain safe.I know consolidating seems to be an answer,but it very rarely works.
Now get :coffee: and have a go at that SOA
Best wishes
LIH

Storm

Hi Viv, please don't panic!

Have a look at SouthernScousers sticky at the top of the DFW board for how to draw up a Statement of Affairs (SoA) - there's normally ways in which people can cut back on the household bills etc to save money each month.

The things most often brought up are:

Check your utility suppliers using USwitch to get the cheapest deal
See if you'd spend less using a water meter
Reduce mobile contracts or go PAYG
Reduce/get rid of Sky/cable TV
Check broadband supplier is cheapest
Plan your meals & cook from scratch to reduce food bill

Sit down with a cuppa and all the statements to work out exactly what you owe to who, the apr (monthly interest x 12) and minimum payments - it's scary, but once it's done it's done.

Generally consolidation loans are not advised here, as you need to address the cause of the debt to avoid consolidating, running up cards again, consolidating again etc...

Storm

bluezone

viv1969 - support is always here

lynzpower

dont panic Viv theres always help here day or night ( even though nights ar somewhat slower, theres usually someone around)

viv1969

I’m at work at the moment, so I’m going to list here what I can from memory (we have it all written down at home.

Me:
Lloyds TSB Visa £8000
Amazon Mastercard £5000
Capital One M/C £ 900
Mothercare £ 300
Evans £ 340
Comet Edge £ 300
SimplyBe £ 150

Husband:
Egg £10000
Mint £ 3600
Lloyds TSB Visa £ 2000
Lloyds TSB Loan £ 3100
GMAC Car Finance £ 1400

Plus:
HFC Furniture Finance £ 1700

Other outgoings per month would be:
Mortgage: £1070, Rates, £127, Water £30, Electricity £40, Phone £20, His Mobile £30, My Mobile £13, house Insurance £35, Car Insurance £25 & £35, Petrol (mine) £200 – Husband’s varies massively according to the number of lessons he has), Food £160 (Inc Dog). Broadband is free – a deal through his Mobile provider.

I’m sure there are other bits and pieces I’m forgetting now.

Our problem (as my panicking eyes see it now) is that we have NO savings and we are at the end of our ropes here.

We know now (after several days deep discussion and thought) that we have to totally restructure not just our finances, but the way we live our lives. I know that getting a loan isn’t always the best answer, but it would put everything in one place where we can see it. We have come up with the idea that once things are at least under control we can then begin to save and make a payment off of the loan once a year, thus reducing both the term and the interest. We also know that this involves cutting up ALL the cards and cancelling any store acct etc….believe me I will be HAPPY to do this.

Husband is already looking for a part-time job that he can work his students’ lessons around, and is spending several hours a day pounding the pavements delivering leaflets (printed for free here at my work) advertising his business. Dec / Jan and beginning of March are notoriously bad for Driving schools both because of dark nights and because lessons are the first thing most people suspend because of the expense of Christmas.

Thanks for the welcomes here, and thanks in advance for the help!

Yorkielass

You've done the hardest thing, realised you have a problem and you need to find a solution, and you've come to the best place. People here are so helpful and knowledgeable and once you've done your SOA they'll give you lots of tips.

One thought for now if your OH doesn't have much driving school work at the moment does he have time for some Mystery shopping - there's a whole thread about it here and it's a great way to get a bit of extra money. There are also lots of survey sites out there too which are worth investigating and will bring in a bit of extra cash if either/both of you have time on your hands.