Drowning in Debt

IvanDrago

Hi,

Im a single 26 year old and im in £14,000 of debt. + a mortgage.

I owe family £11k (interest free loan to help me buy my house).
I owe Dfs £1600 interest freefor my sofas for said house.
I owe Santander £1400 for a loan that i got to decorate.

Im currently paying off £100pcm, £57pcm and £130pcm on the above.

Taking into account my mortgage (£550 fixed until sept '12) plus all my other bills my outgoing are £1100pcm :eek:

i only earn £1450 nett though and im really struggling to cope, im trying to sell my car but i could do with one tbh. In the last 2 months ive lost my ot at work + my lodger so im down £700 a month. I dont want another lodger though as they are annoying.

i was thinking of getting a loan of £7k (to get the 6.9% interest) and paying off the dfs and santander loans then paying a chunk off my family loan and using the rest to finish decorating my house.

both ways i could be debt free by the end of 2015. Both ways i'll be paying roughly £350 pcm until dec 2015. but the 7k loan option gives me the chance to finish my house and only have 1 payment going out on the same day.

any advice is welcome. thanks

nannymiaow

If you are drowning in debt do you honestly think getting more debt is a good idea?

bottleofred

Debt consolidation is not a good idea and only works for approximately 10% of people who try it and I had to try it twice to find this out:o List your statement of affairs and you'll get loads of tips and advice on how to save money, which can then go towards your debt.

ss3n08

I really don't think another loan is a good idea and you may not want another lodger but the extra income would be really useful if you are as desperate as you say you are. I'm not sure why you would even thyink of not getting one if things are that bad. At the end of each month by the time all my bills and loan repayments come out I am only left with £60 and I manage (25 year old in a relationship). It is a struggle but I know that by September 2012 I will have another £258 a month as my car loan will be paid off. It seemes like it would never come but everyday it's getting closer and there is a light at the end of the tunnel. Having experienced this, I will never buy anything on credit again. If I can't afford it, I can't have it.

Tilly_MFW_in_6_YRS

Morning, if your DFS loan is interest free, then it doesn't help by consolidating that into a loan which bears interest.

Advertise on a lodging website straight away, if the house needs a sort out to make it attractive to lodgers then get cracking, a good clean/spruce up won't cost money just time and hopefully you can find someone quickly.

Focus on the highest interest rate first, be cautious on food budget, sort larder/freezer/fridge and meal plan to use the contents up, thus reducing food spend. If you have additional time on your hands as your OT has stopped, can you use this time to do something else? Your family lent you money, do they have jobs which require external help and will therefore cost them money, which you have the skills to do - if so, you could work off some of your debt perhaps?

Do your best to stay calm, not easy but you will think more clearly if you focus.

Good luck

dark^knight

Hi,

Please post your SOA on here and people will help you find some money in your outgoings.

We'll all been there and know it's not easy. However, with a plan and some hard work, you'll get there. Stay positive.

xyellowx

look at getting the lodger on a short term basis until you sort out the dfs and santander debt, have a word with the family about the loan and ask to reduce payment for a 12-18month period but then pay more back once other two debts are clear
look at it long term your in debt on one side , but own a house on the other and the debt will make the house nicer possibly even add to value if money is spent on it wisely take the settee as a learning point and next time buy somthing more to your budget and when in a posisition to pay for it

foxgloves

Try not to consolidate.....the fact that we did it 3 times before becoming debt-free earlier this year shows that it doesn't really solve debt problems, just holds them off, while making the amount owed bigger at the same time. Debt happens when people spend more than their income, so unless the income situation together with lots of controlled budgeting changes, consolidating debt rarely solves the problem. Having tried this 3 times, my partner & I are determined that we would never again try to solve debt by acquiring more debt.

IvanDrago

ok thanks for the advice.

im just going to carry on paying 100 to my family loan and 130 to santander and 57 to dfs.

i look at debt as 'saving in reverse' but now im going to stop buying things i cant aford. at the end of it all though at least i'll have a nice house.

cheers