Its Bad And About To Get A LOT Worse

Tixy

A DMP is not as 'bad' as bankruptcy. If you work in banking / accountancy / insurance etc then declaring bankruptcy could prevent you from being able to work.
A DMP shouldn't, as its an informal agreement between you and your creditors not a form of insolvency.
On a DMP it is still possibly you could end up with CCJs, although these don't usually happen - if that would be an issue with your job then it might be a risk.

Re B&C insurance - even given the house value I'd imagine you could get a combined deal for around £40 a month. Might be worth double checking exactly how much value of contents you are insuring and seeing if you are over-insuring (no point having £200k worth of contents insurance if your contents are only worth £50k).

Its obviously going to take some adjusting to but it sounds like you are taking everything onboard so good luck.

Without some income for OH and even with cutbacks it looks like you will be unable to meet your debt repayments - so I would talk to one of the debt advice charities. Depending on whose name the different debts are in, maybe OH could do a DMP but not you?

Tixy

In terms of the parent's house - I would be very careful about this. I suppose worse case scenario might be if you also lost your income (either unemployment/ill health etc) and you couldn't meet the repayments - they could lose the house they live in.

Also one other potential thing to consider (and not something I know lots about) would be the potential deprivation of assets issue - eg if OHs parents needed to go into a residential home and pay fees then giving away their home, even a few years before, can be a problem.

RAS

inflatablebagpuss wrote: »

There is also something else that may be of relevance possibly? DP's parents own their own home outright and have long ago offered us the deeds - to sign them over. Their house is worth about £200,000 and while we have no intention of moving them out - could the equity in this property be released to pay off some of the other debts. DP's parents view is that as he will inherit the house one day anyway (only child) he might as well get most use out of it now.

This would NOT be a good idea.

At present you have some equity, so the creditors might kick off, try to put a charge on the house etc. The minute they realise that he has more equity than debts making him bankrupt becomes an enticing proposition because they will get their debt repaid for sure and he can stump up the fees.

Also for future purposes if either parent needs care or needs to claim benefits, the parents in law would be treated as if they still owened the house because of the deprivation of assets rules.

FireWyrm

RAS wrote: »

Also for future purposes if either parent needs care or needs to claim benefits, the parents in law would be treated as if they still owened the house because of the deprivation of assets rules.

InflatableBagpuss please do note this piece of advice. It is something that looks like a non-issue right now, but could become a major headache in the future. The government has made it clear that it intends to use any and all means available to make people pay for their own private geriatric care regardless of a lifetime of national insurance contributions and this is just the type of thing that could happen. Do not even think about liquidating that house right now. There are many other options open to you first of all.

I know that this mountain of debt seems absolutely impossible to overcome, but I have seen at least one other poster on here successfully climb out from under a similar level of debt. It will take time, effort, perseverence and immense hard work, but it is possible....just remember that.