Living with a Debtor

Tangerine

My partner is hopeless with money. That's the bottom line.
Around December time he started getting phones calls from his credit card companies. I don't think I twigged at first, but when all these numbers were appearing on our phone I did wonder who they were. Then one left a basic message just asking him to ring back. I asked him who it was in the end and...it was only after some delicate prompting from me......that it turns out he's maxed all his cards. He has four. I don't know for sure but I think he must be around £40k in debt. He'd been drawing out cash to live on. I didn't realise. I feel stupid for not realisng that.

I often joked that, financially, if we didn't have bad luck we'd have no luck at all. He's been made redundant three times in ten years. :rolleyes2 Which I guess accounts for the problems above.

As it turns out our finances are somewhat separated. He pays the mortgage (currently going up month by month it seems :sad: ) and I pay the bills. (which are in my name).
He wants us to remortgage as we're out of our low-rate period......but one of my questions is is it better to change it from both our names to just my name (he wants to do that to protect the house if things go badly wrong for him), or should we just leave it in both our names......risking not being able to get a good deal due to his now-apparent bad credit rating?

Also, he has started to negotiate with his credit cards companies which I'm pleased about. After his confession, he seems to have been more pro-active in that respect. He was burying his head in the sand over it up to then I think.
So, my second question is, is it worth him heading towards DMP?? Do they just negotiate with these companies as he's already done, or do they offer more? I think he's had the interest frozen, which is good.

Some advice from anyone who knows more about this stuff than me would be helpful. Thanks in advance.

On the plus side, surfing round MSE I've set in motion some money saving actions for our bills. By calling the gas and electricity suppliers (after recieving my statements saying I was in credit) I've reduced my monthly direct debits by £50 by just asking!! I've saved £15 a month by switching phone companies. And I've applied for one of these 0% balance transfer cards (accepted, phew!) to clear MY £2300 credit card debts.

I read somewhere (forget where now) that keeping my finances separate from my OH will mean at least one of us has decent credit! We have a son together (age 5) I hope he doesn't inherit his father's money sense....:undecided

shameless-about-money

First of all you need to post an SoA so that someone can help you with the day to day state of affairs.

Yes you can change the house into one name - but there is a five year rule - if something goes badly wrong within five years of the name change the house would still be involved.
Even with a name change, in a bankruptcy your husband would still have benenficial interest in the family home.

What is the current value of your home and how much is the mortgage?

Do post an SoA

angelavdavis

Hi T

Sorry to hear of your problems with OH.

It sounds like you have made a good start in moneysaving. It might be worth posting an SOA to see if any of the good folk on here can spot any other ways you could be saving.

My first question about OH is has he looked at his credit file? I suggest you sign up to Quidco and apply for one online free (but remember to cancel so you don't incur charges). I think you should see the full scale of what you are dealing with.

I can't help with the query about switching the house to your name only. I don't know how that would be viewed should your OH choose to go bankrupt for example.

Tangerine wrote:

He'd been drawing out cash to live on. I didn't realise. I feel stupid for not realisng that.

Is he working now? Was he working at the time? If he was - all the more reason to be looking at examining an SOA for both of you. In addition, you need to be taking the cards off him to prevent him being tempted again. Cut them up!!! What was the money being spent on? Was he buying stuff? Perhaps you have stuff you can ebay to start reducing the debts?

Tangerine wrote:

He's been made redundant three times in ten years. Which I guess accounts for the problems above.

it certainly doesn't help

Tangerine wrote:

He wants us to remortgage as we're out of our low-rate period......but one of my questions is is it better to change it from both our names to just my name (he wants to do that to protect the house if things go badly wrong for him), or should we just leave it in both our names......risking not being able to get a good deal due to his now-apparent bad credit rating?

The problem comes if his credit rating is so poor that you cannot get a new mortgage at a reasonable rate! Have you queried this with your existing lender?

Tangerine wrote:

So, my second question is, is it worth him heading towards DMP?? Do they just negotiate with these companies as he's already done, or do they offer more? I think he's had the interest frozen, which is good.

Organisations such as CCCS are in a better position to be negotiating with the companies. It will also take the heat off your OH should the debts be referred to a third party.

Tangerine wrote:

I read somewhere (forget where now) that keeping my finances separate from my OH will mean at least one of us has decent credit! We have a son together (age 5) I hope he doesn't inherit his father's money sense....:undecided

I guess that one is now down to both of you!!!! I can't offer any advice as I don't have kiddies but someone on here will no doubt provide tips for this one! Good luck!!!

Tangerine

Thanks for the replies! They are much appreciated. I didn't know about the 5 year rule.
OH is working now, but income is variable as he's started up alone. I think the money he has spent from cards has been frittered. We haven't really bought stuff. If I'm honest he's spends too much of it in the pub. But that's a whole other subject!!

Mortgage: £580 (£94k owed int. only)
Don't know current value, maybe £115k
Child maintenqance : £230
Car Ins £40
His mobile: £30
My mobile: £15
Elect/Gas £70
TV Lic £11.37
Landline phone: £15
Water: £20.91
Council Tax: £94
Broadband £17.99
SKY £34
Baby Bond: £25
My bank loan £69
His bank loan: £360
House ins £32.92
3 ins policies £55
Food (for 3) £300
After school care £60 approx

I rarily buy stuff for me, but I guess I lose money on buying lunch at work or buying stuff for our son. He does smoke and drink. That costs I know. But I can't control that so much! Lol. He keeps saying he wants to quit, but hasn't. Been saying it for the ten years I've known him. Ho hum.

I bring home £1300 a month
He varies as he's just started self employed. Est around same income as me.

His credit cards: roughly £40k debt (MBNA, Mint, Amex & Marbles) ? rates
My credit cards: £2300 (just tranferring to 0% rate to 2008)

We haven't looked at OH's credit file. I wasn't aware of the free option to do that. Might be worth looking at to see how bad things may be. Thanks again.

angelavdavis

Hi There!

OK, have had a look and here's my two-penneth:

Tangerine wrote:

Car Ins £40 - £480 a year seems high - check on some comparison sites to see if you can get a better deal
Landline phone: £15 )
Broadband £17.99 ) Phone and BB totals £32.99 - shop around for a better deal
SKY £34 - this needs to go. If you phone to cancel, you will probably be offered a free period to keep it on anyway.
My bank loan £69 - what is total owed, apr and remaining period? Could you move this to a 0% credit card?
His bank loan: £360 - as for your loan
House ins £32.92 - this is nearly £400 per year - is this house and contents?
3 ins policies £55 - what are these for?
Food (for 3) £300 - you can definitely reduce this down by £100 per month - check out the Old Style board for ideas on meal planning, storecupboard and freezer challenges, etc. I don't know what sort of cook OH is, but as he's selfemployed, if he's not working, he can get something out of the freezer and heat it up ready for when you arrive home.
After school care £60 approx

If you switch anything - use Quidco so you get some cashback.

I rarily buy stuff for me, but I guess I lose money on buying lunch at work or buying stuff for our son. He does smoke and drink. That costs I know. But I can't control that so much! Lol. He keeps saying he wants to quit, but hasn't. Been saying it for the ten years I've known him. Ho hum.

TBH, being harsh about it, he needs to realise how serious a situation he has got his family in and start taking some responsibility for moneysaving.

You need to ensure he has "spending money" each month and doesn't have access to any other money - so as much as possible can go toward settling his debts. He needs to start prioritising. He has already shown he can't be trusted with credit.

How much does he spend on cigarettes? He's paying for an early grave. Your child is also more likely to be a smoker too if a parent smokes.

Items that are possibly missing from the SOA are - running costs for car, petrol, cigarettes, haircuts, other purchases such as lunches, toiletries, etc.

I saved £70 per month avoiding the office canteen. Make sandwiches the night before for both of you. You can even freeze them in advance if necessary (avoid salad though).

Buy two notebooks next time you are out and both keep spending diaries - you will be amazed to see where the cash goes. According to the figures so far, you have approx. £1000 over each month which could potentially increase to £1200 with some budgeting. If your estimations for your OH's salary are correct - you are both earning good money so should be able to get a good handle on repayments quickly.

Do you have a spare room you could rent?

Tangerine wrote:

I bring home £1300 a month
He varies as he's just started self employed. Est around same income as me.

His credit cards: roughly £40k debt (MBNA, Mint, Amex & Marbles) ? rates
My credit cards: £2300 (just tranferring to 0% rate to 2008)

What are your minimum payments for these? You need to factor these in.

Tangerine wrote:

We haven't looked at OH's credit file. I wasn't aware of the free option to do that. Might be worth looking at to see how bad things may be. Thanks again.

You sound like you are doing all the right things, but you were never the problem.

Sorry if I sound harsh but the bottom line is he needs to have his own lightbulb moment - you can't do it for him!!!

shameless-about-money

Missing -

Road Fund Tax
Petrol
TV licence
amount for tyres


Are you claiming your CTC - it isn't mentioned.

You could be in line for WTC too, it might be worth checking.

Have a look at https://www.entitledto.co.uk and input your personal details and see what it comes up with.

Tangerine

Thanks again for your help.

Since my last post OH has come home and I've had a chat with him. I confessed I'd posted here and we got to talk more. (That in itself a good thing).

Turns out he's £60k in debt. :eek: He has outgoings of £1400 per month to just cover this. It's scary to think about, but at least there's honesty there.

He's promised to phone the CCCS tomorrow. I've asked him to keep a day-to-day diary. I've said I'll do that too. I hope this is a real step forward for us.

As to your posts, yes we can look at cutting things like insurances. We DO get CTC (about £180 I think) so that does help. Last time we checked we didn't qualify for WTC. Bum.

Thing is neither of us are on awful money, so we should be able to somehow work through all this. I know it will take time and - crumbs - £60,000 is a lot of money. Especially when I didn't mount it up.
In my low moments it's easy to be resentful about this, but I know that's not constructive. My OH is a hard worker and I know he'll put the hours in to make money. But he has weaknesses - pub and cigarettes - and although I point it out, I know it's sometime shard to break that habit.

I told him I should give him pocket money and I take control of the paymnets. He agreed in theory. I hope he means it.

Bottom line though.....thanks to posting here today and talking, I think we've moved a step forward. It's a long journey. I hope we make it. He gave me a hug and thanked me for being there to help him and understanding. That was quite emotional. I know it's been hard for him to admit the mess he's in. I don't have all the answers, but a problem shared is a problem halved.

This site is testiment to that too.

chevalier

Might sound a bit cheeky, but if he is working all the hours god sends then he won't have time to be in the pub........!

Tangerine

You would think that wouldn't you!? :rolleyes:
He works 9-7, which I think is pretty lengthy. Plus weekends. He calls in to the pub for 60-90 minutes maybe 5 nights of out 7. Yes, I think that's too much. But it proves there is time.

Hmm, I don't really want to turn it into a discussion into pub time, but I know everyone needs their wind-down time. We're not living perfect lives I know, but something workable would be handy!

Psykicpup

Maybe you ccould have a chat with him as to why he goes to the pub & suggest he cuts down just until this is sorted out. If its purely social - meeting his mates - maybe he could invite them round sometimes or cut the time down to just 1/2hr in the pub or every other day. If its 'cos he is drinking alot, then thats a different thing all together & may need to be tackled seperatly if & when he's ready......

angelavdavis

I am glad that posting on here has become the catalyst to get you both finally talking about this - and finding out the scale of problem - as scary as it is at the moment.

Good luck with CCCS.

Keep us posted on how things are going and remember there are plenty of people here to help and all the motivating stories also that will boost you should you need it.

Best wishes