Where do I start?

a_little_one

These are my debts at the moment. Some I am paying more interest on than others. They are not so out of control now, but I would like to clear them as they cost a lot to furnish. I don't think I'm in a position to consolidate. I'm self employed and my income is limited.

I had a personal loan up until it was paid off before Summer last year, which was based on previous employed salary. It's credit cards I'm having issues with.

We are in a 1 bedroom flat that we have an interest only mortgage for. We tried to move out and rent to sell in Summer 2010, then we had to move back in after 18 months because we were just being crippled paying for 2 properties. I've had to empty my ISA covering the mortgage a couple of times. It probably has just over £1000 or £1200 paid into it in the past year. We are really stuck, because we can't renovate to try to sell or rent. We have 2 daughters, one who starts school in Aug 2013 and the other who is under 1. Ideally by the time she is school age I would like to be renting elsewhere a 2 or 3 bedroom place, closer to her primary school.

RBS current account: I have a £2000 overdraft limit. I tend to go up and down between -£1000 to -£1900 over the course of each month. I've only just started paying interest on this.

RBS CC: Limit £700, balance £639, Interest about 23%, so min payment around £16 and interest around £14. I've been trying to start paying £50-£100 extra to clear this easily first.

Halifax CC: Limit £6800, balance £6829, Interest about 25% but more like 26-27% with charges. The interest keeps taking me over the limit. Minimum payments keep going down, £143, interest £149.

Virgin CC: Limit £7000, balance £6435, Interest about 17-18%, min payment about £168, interest about £93.

It's about 16K in total. Our combined income is probably around 18-24K.

The halifax and virgin CCs were closed by the lenders, so I'm left with the balance and interest to pay off. I'm not sure how that will have affected my credit rating. They weren't defaulted, but did go over limit and then only had minimum payments made for about the pas year.

My husband has a really old cc debt of just over £1000 from about 12 years ago that he gets occasional letters from.

I need to update my address with credit expert. I think my credit record won't be too bad except middle to the the end of 2010, where I found it difficult to keep up with payments, so had some that were paid late when I struggled for maybe 3-4 months.

My income coming in fluctuates a bit. I have about £1600 each month between my limited income, my husband gives me £500-£600, child tax credits (half of which pays childcare), child benefit. If I make more profit this coming tax year my tax credits drop. We've always kept our finances separate. Self employed I tend to take out as much as I need to so long as I have cashflow left over. That's something I want to grow though, so I can start to pay myself more. My basic outgoings are probably about £1000 a month, not including food or luxuries, clothing for the kids, etc. I think I should be using what I have as disposable to pay off debts better.

Should I be trying to throw any spare money at the Halifax card first? I don't think I can consolidate and I think if I went to my bank they would turn me away (I have consolidated previously smaller debt about 9K, with my bank and paid that off last year, but I don't think it's an option now). I also don't think I'd get a credit card on 0% elsewhere. I don't know if my husband could consolidate based on his income.

The personal loan I had before with RBS. I think I might have been mis-sold insurance on that as they said it was a requirement in order for them to give me the loan.

How do I start to make a plan to get debt free and what do I prioritise?

KarleyMarie

Write out a SOA for an average month and see where you can make cut backs.

The hardest step is asking for help though. Well done x

a_little_one

My month breaks down roughly as:

-£278 nursery costs
-£85 ISA
-£24 Life Assurance
-£143 Halifax CC
-£123 mortgage interest
-£26 t-mobile
-£167 Virgin CC
-£37 kids trust fund / ISA
-£8 credit expert
-35 Virgin Media
-£200 food
+£660 CTC
+£135 Child Benefit
+£500 to £600 from my husband
+£200 to £500 self employed

My husband covers our council tax, electricity / gas and pays for probably half the food bills. There are extras, like this month clothes for the kids.

I think I should be aiming a certain amount each month to pay off debts, but I don't know where to prioritise. When we tried to sell we were trying to get at equity to help clear debts and get more space, but it had the opposite affect because we didn't sell and our outgoings went up.

a_little_one

Statement of Affairs and Personal Balance Sheet

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

Monthly Income Details
Monthly income after tax................ 500
Partners monthly income after tax....... 1100
Benefits................................ 790
Other income............................ 0
Total monthly income.................... 2390

Monthly Expense Details
Mortgage................................ 123.4
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 105
Electricity............................. 40
Gas..................................... 40
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 34.39
Mobile phone............................ 26.76
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 400
Clothing................................ 30
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 50
Childcare/nursery....................... 278
Other child related expenses............ 37
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 40
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 0
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1204.55


Assets
Cash.................................... 1200
House value (Gross)..................... 69000
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 70200


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 59000....(123.4)....1.5
Total secured & HP debts...... 59000.....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
RBS CC.........................639.......16.36.....22.5
Halifax CC.....................6829......143.......149.5
Virgin CC......................6435......168.......92.6
Total unsecured debts..........13903.....327.36....-


Monthly Budget Summary
Total monthly income.................... 2,390
Expenses (including HP & secured debts). 1,204.55
Available for debt repayments........... 1,185.45
Monthly UNsecured debt repayments....... 327.36
Amount left after debt repayments....... 858.09

Personal Balance Sheet Summary
Total assets (things you own)........... 70,200
Total HP & Secured debt................. -59,000
Total Unsecured debt.................... -13,903
Net Assets.............................. -2,703

angelbob

a_little_one wrote: »

Statement of Affairs and Personal Balance Sheet

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

Monthly Income Details
Monthly income after tax................ 500
Partners monthly income after tax....... 1100
Benefits................................ 790
Other income............................ 0
Total monthly income.................... 2390

Monthly Expense Details
Mortgage................................ 123.4
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 105
Electricity............................. 40
Gas..................................... 40
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 34.39
Mobile phone............................ 26.76
TV Licence.............................. 0 do you pay yearly if not it's about £12 a month
Satellite/Cable TV...................... 0
Internet Services....................... 0 none??
Groceries etc. ......................... 400 could get this down to £300
Clothing................................ 30
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 50
Childcare/nursery....................... 278 do you get child tax cedits towards this?
Other child related expenses............ 37 what's this?
Medical (prescriptions, dentist etc).... 0 should be something, unless you have tax credit exemption card
Pet insurance/vet bills................. 0
Buildings insurance..................... 0 you need something here, as you own your own home
Contents insurance...................... 0 and here
Life assurance ......................... 40
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0 again
Haircuts................................ 0
Entertainment........................... 0 again
Holiday................................. 0
Emergency fund.......................... 0 are your savings for this? if not pay some debts with it
Total monthly expenses.................. 1204.55


Assets
Cash.................................... 1200
House value (Gross)..................... 69000
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 70200


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 59000....(123.4)....1.5
Total secured & HP debts...... 59000.....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
RBS CC.........................639.......16.36.....22.5
Halifax CC.....................6829......143.......149.5
Virgin CC......................6435......168.......92.6
Total unsecured debts..........13903.....327.36....-


Monthly Budget Summary
Total monthly income.................... 2,390
Expenses (including HP & secured debts). 1,204.55
Available for debt repayments........... 1,185.45
Monthly UNsecured debt repayments....... 327.36
Amount left after debt repayments....... 858.09 do you know where this goes each month???????????

Personal Balance Sheet Summary
Total assets (things you own)........... 70,200
Total HP & Secured debt................. -59,000
Total Unsecured debt.................... -13,903
Net Assets.............................. -2,703

maybe look at where the rest of your money goes, and use some for your debts. A spending diary might help xx

a_little_one

We don't have a TV, so no TV license.
Internet services I've put done as phone.
Other childcare is the kids' trust fund and ISA.
Yes I get tax credits.
We don't have to pay for prescriptions.
I do pay building insurance, I've missed that. I can't remember how much it was, about £200 annually I think. It went up last year. It's through our council though as ex-council property so not something we can easily change. I don't have contents insurance.
We have factoring as well at about £30 a quarter, but then we get extra bills for that. We had an extra bill of £105 from the council to fix a sewerage pipe last month for example.
Birthday and Christmas just come out of disposable income the few months before to spread the cost a bit over 2-3 months.

I think we are living within our means month to month, so what we have leftover we are spending, whether that's going out with the kids, etc. Because we have separate finances what's leftover is spread about a bit and the income I get is also spread across the entire month a lot.

I'm figuring I should start throwing what disposable income I can at the Halifax credit card, as it has the higher interest rate. I'd like to get the smaller credit card with my own bank down as well at first as that could take 2-3 months really.