Newbie Loan Advice Please!!! - APR!

kelzbelz_04

Ok this is our statement of affairs as it stands currently, Ive done it with 'him' as the main person as he has most of the debts! We are here taking all your wonderful advice together though!!!! :eek: ........and thanks for all your time xxxxxxxxxxxx

Statement of Affairs and Personal Balance Sheet

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 0
Number of cars owned.................... 2

Monthly Income Details
Monthly income after tax................ 2300
Partners monthly income after tax....... 1100 (although about to start another job paying £1300 per month IN fEB 2012)
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 3400

Monthly Expense Details (these are between us)
Mortgage................................ 734
Secured/HP loan repayments.............. 0 – im not sure what this is! If anyone can enlighten me I will put the correct figure on!
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 142
Electricity............................. 30
Gas..................................... 30
Oil..................................... 0
Water rates............................. 28
Telephone (land line)................... 15.48
Mobile phone............................ 64
TV Licence.............................. 12.10
Satellite/Cable TV...................... 24.50
Internet Services....................... 0
Groceries etc. ......................... 200
Clothing................................ 0 – I wish!
Petrol/diesel........................... 480 (he’s a driving instructor)
Road tax................................ 17.5
Car Insurance........................... 55
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 10.05 (prescription pre payment cert)
Pet insurance/vet bills................. 14.23
Buildings insurance..................... 21 (buildings and contents)
Contents insurance...................... 0
Life assurance ......................... 11.24
Other insurance.........................
Presents (birthday, christmas etc)...... 0
Haircuts................................ 25
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Other things to add in:
Accountant Fees - ……………………………25
Pension Payments ……………………………51
HMRC National Insurance ………………..12
Driving Instructor Franchise Fee ……….192
Total monthly expenses.................. 2194.10


Assets
Cash.................................... 0
House value (Gross)..................... 192000
Shares and bonds........................ 0
Car(s).................................. 13500
Other assets............................ 0
Total Assets............................ 205,500


Secured & HP Debts
Description....................Debt......Monthly.. .APR
Mortgage...................... 192000...(732)....0
Total secured & HP debts...... 192000

Unsecured Debts
Description....................Debt......Monthly.. .APR
Loan (Him) …………………… 6500 ….. 174……….7.4
Car (Him) ……………………..12000 …..£285…….. ??
Overdraft (Him) …………..2000………£30 interest……
Tax Bill (Him) ……………… 2500……….. nothing as of yet
Wedding (Both) …………..6000…………..nothing as of yet

God this is so depressing! I reckon this has to be one of the worst SOA's you have all ever seen ..... *embarassed*

So this is current stuff!
If we had the loan of 17000, it'd be 291 between us per month and would get rid of all of the unsecured debts except the car. -

He has quite a nice car for his teaching and theres no way he'll change it! But we are flexible on anything else!!!!!!

x x x x x x x



xxxxxxxxxxxxx

Tixy

Definitely seen loads worse than that on the dfw board - honestly!

Right so it looks like you have 3400 coming in and 2194 going out. So you should be able to afford 1200 towards your debts each month - in which case why do want an agreement to only pay £580 ( the car plus the £291?) what will you do with the other £600 a month? no point saving £600 a month at maybe 2% apr and paying off debts at 11%.

If your statement of affairs is right you can afford £1200 towards debts, so I really wouldn't go for the loan but would pay off the debts you already have (and pay the tax debt over 12 months as they've offered and you'll still some spare for the wedding)

But do check your statement of affairs - is his income after tax for this year? I notice you have his business costs going through so maybe you haven't budget for the tax on his expected profit next year?
Also you don't seem to have anything budgeted for car maintenance - you need to think of servicing, tyres, mots etc and work out an annual cost and divide by 12 to put in the budget. You probably need to budget a small amount for presents, clothes, entertainment unless you really spend nothing over a whole year.

In terms of costs - maybe see if you can cut your grocery bill a little (its not that high but its possible to manage on less), other things don't look too high really.

telboyo

The fuel cost and car payment are business costs and should not come out of his salary. Does his driving school really pay him 2300 after tax? Reduce his salary to 1600 and apply the car costs fuel and insurance as costs against the business. This will reduce his company tax liability and and his personal tax liability.
Get a new accountant.

ViolaLass

That theoretical £800 or so that you have left each month after debt repayments, where has it been going? Do you know? If not, and it's not in your bank account, it would suggest that you're spending more than you think you are. Are you honestly spending 0 on entertainment, for example? You need to make sure that it's accurate, which might mean keeping a spending diary for a couple of months. Also, £64 a month on mobiles is very high.

chalkie99

I think you need to really get a grip of what your o/h is actually earning as the figures seem inconsistent.

Earlier in the thread you said he was earning about £26k a year and you were on £20k.

In the SOA it looks like those figures were gross for you but net for him?

When did he become self employed?

When did he buy the car and how much did he pay for it?

Add up his sales income (all the payments from the lessons) then deduct his business costs, fuel, servicing, insurance,etc and the franchise fee.

From the answer to this sum - deduct £7500 for his personal allowance, then take off 31% for tax and National Insurance. Add the £7500 pa back in.

Is he still left with £2300 per month (£27600 per year)?

Something, somewhere is wrong and I reckon he might need a new accountant at least. Certainly writing down allowances on the car should have been explained to him before he bought the car.

LovelyLeeds

kelzbelz_04 wrote: »

Electricity............................. 30
Gas..................................... 30
Both figures on the low side have you checked your annual bills and divided by 12?
Mobile phone............................ 64
Quite high, can you reduce these at all?
Groceries etc. ......................... 200
Rather low, are you sure this is correct for a month?
Clothing................................ 0 – I wish!
Unrealistic, you simply have to put something in here!
Petrol/diesel........................... 480 (he’s a driving instructor)
Surely a huge proportion of this can be offset in partner's tax accounts - as others have suggested - might be time to change your accountant
Car Insurance........................... 55
Is this just for your car or both? If both, way too low surely?
Car maintenance (including MOT)......... 0
Both cars are under 3 years old so no MOT?
Presents (birthday, christmas etc)...... 0
Are you sure about zero?
Haircuts................................ 25
Get rid of this!
Entertainment........................... 0
No takeaways/McDs/dinners out/bottles of wine/DVDs?

You're taking on a lot of your partner's debt which upon marriage will be joint. Your partner is living in his overdraft, this needs to be addressed as you will both be maxed out within a few months, then you'll be going down the PDL route (which is done to death on here - read a few of those threads to see what you'll be in for).

Maybe have a re-think/re-calculation of your SOA - it doesn't seem to be very accurate.

Can only echo this post by somethingcorporate:

Just in case my message is not obvious do not consolidate a 7.4% debt into a new loan at 11%.

kelzbelz_04

ok thanks!!! No loan! hurrah! Well at least thats one decision made...! x