What a Right Pickle!

gardenlady_2

nomoredebtplease wrote: »

Really? I was making an assumption that we didn't go on a DMP, then there would at least be some loyalty offer when we get to the end of our deal. This is an important consideration for us.

That's what I am saying about Santander! There are no new deals with them unless you are a new customer. That way, they keep people on the SVR, which brings them more money. This is what 3 brokers have told me.
If you go on a DMP Santander wouldn't know, that is not a consideration for them, as you have already been credit checked they don't do it again.
It is any new lender you would approach who would know about the DMP as they would credit check you.
I am sharing the information with you that I have learnt over the last 3 months. Sadly, most people don't realise ALL consequences of getting into debt. Being forced to stay with your current mortgage provider- and paying whatever rate they say- is one of the conseqences. I agree with the comment about assumptions- ring them and ask. Maybe you will get a different answer than I did the 3 times I have rung them.

If i could change one thing about being on the DMP it would be that I would have got a new 5 year fix with a new mortgage provider before entering into the DMP, ie before anything showed on the credit rating. That would've cost £2.5k in penalty charges, but at the current rates if we have to stay with Santander we will pay an extra £25k on our mortgage!

merlot123

I am with Santander, and have recently renewed my mortgage 6 months early as they phoned me, they offered me a fixed rate of 4.59% for 3 years - no fees, LTV 50%. They are offering customers deals but they do credit check you on renewal so they told me, but that didn't concern us as we are no longer in debt and have an excellent credit rating.

OP, you do need to start enquiring, you could just phone them and find out if any deals are available for you. You are short of money each month and you will run of credit sooner or later.

Loyalty - that doesn't exist, we are talking about banks here, they are a business and want to make money from you, they are not your friend and you are not theirs. We are simply a number to them, they don't care one way or another.

merlot123

nomoredebtplease

merlot123 wrote: »

I am with Santander, and have recently renewed my mortgage 6 months early as they phoned me, they offered me a fixed rate of 4.59% for 3 years - no fees, LTV 50%. They are offering customers deals but they do credit check you on renewal so they told me, but that didn't concern us as we are no longer in debt and have an excellent credit rating.

OP, you do need to start enquiring, you could just phone them and find out if any deals are available for you. You are short of money each month and you will run of credit sooner or later.

Loyalty - that doesn't exist, we are talking about banks here, they are a business and want to make money from you, they are not your friend and you are not theirs. We are simply a number to them, they don't care one way or another.

merlot123

Yes, I appreciate the 'loyalty' comment. I meant it in terms of existing customer deals (which we did secure previously with them albeit 5 - 6 years ago when the world was a different place!) rather than any personal friendliness they may portray.

I am planning to phone Santander today. I see three options:
1) Secure a deal with them effectively 9 months before the end of our deal (unlikely).
2) Enquire about moving to another mortgage provider and accept any early redemption penalties
3) Do nothing and probably end up on the SVR in Sep 2013.

Hopelessly_Hopeful

Good luck with the mortgage people. If you don't ask you dont know. It will be hard with 78% LTV. Am assuming you are on 80k and 48k salaries - MSE mortgage calculator suggests 320-368k mortgage lending possibility. Appreciate you do have some asset on the balance sheet. I would think very very carefully before considering selling as you potentially have a significant investment as well as good home, these things are hard to claw back so I'd sit tight.

Of course, none of this tackles the real issue of not being able to afford the private schooling at this stage. I really don't mean to be unkind with that but the lightbulb moment hasn't fully arrived. As someone who has also trodden the IVF pathway I speak with both heart and mind. I do now know that keeping our fingers crossed doesn't offer a solution and the deferring difficult decisions only makes them more complicated and costly. We will of course be here for whatever choice you make. I do hope you accept the comments with the spirit in which they are intended.

HHx

kezlou

Hows it going nomoreindebt?
Hope you had a good new year with your family.
.
Good luck with your mortgage company today, i hope they offer you a better deal. At least if deal with them now you can always look or a better deal elsewhere.

Fingers crossed all goes well, let us know how get along.

merlot123

nomoredebtplease, I was an existing customer of Santander, and they phoned me 6 months earlier than my existing deal was due to end, I do hope they can help you, I hope my post do not come across as being harsh, I can't help feeling that you haven't had your "true lightbulb" moment yet. You are not treading water, you are slowly sinking and you need to address that.

I found London & County (a mortgage broker) very helpful when we were in debt, they looked at various lenders and came back with a good deal for us at the time, they didn't charge us a fee either and I found Lewis at L & C very helpful and non judgemental.

I will get the link for you. http://www.lcplc.co.uk/best-buys/


I do hope you get the news you are wanting today from Santander, do let us know.

Merlot123

wattapain

For what it's worth, I think the real root of the OP's problem here is the 'losing face' aspect.
I really do not mean to be judgemental, but as a CAB adviser, sadly I see this situation all too often.
They live in a £500k house, have a £10k car, and pay £1800 a month for private schooling.
These 3 are symptoms of the lifestyle/dream that they have chosen.
Cutting back on all of these would, almost instantly have a dramatic impact on the debt, but there is, maybe an understandable reluctance to do this, because it announces to 'friends' & family that it is not affordable any more.

Maybe they have 'come up in the world' from humble beginnings. And are ambitious (nowt wrong with that), and probably are now moving in circles who appear(at least outwardly) to be able to afford these things.
But I would guess there are a lot of people (prob some of op's friends) who are facing the same dilemna.
Once one of them 'comes out' and admits the problem I'd bet there would be others.

As someone else has already said, these choices need to be made now, while there is still a choice, rather than wait till there is none ie reposession/ redundancy etc.

I really do wish you well op, and hope you could maybe take some of the excellent advice given so far.
Good luck

Terri

LannieDuck

I haven't read the whole thread, but my feeling is that you'll have a choice between keeping the nice lifestyle, and keeping the twins in private school. If you cut back seriously in other areas, I think you can probably find £1000-£1500 in your budget, e.g. cut out holidays, cut your own hair, get rid of contract mobile phone, cut food shopping down. It'll be painful, but if you choose to keep the school fees, it will be a proactive choice. I'll go through later and see if I can find sufficient cuts to cover the shortfall.

I honestly don't think you can go onto a DMP in clear conscience while retaining such an expensive luxuary. But that's just my opinion; whether there's a way to do it is another matter.

Oh, and check out ebay. I'll bet you've got some good quality stuff you don't use anymore that you could sell.

LannieDuck

I've read through the rest now, and I think my numbers may be a little out of date.

nomoredebtplease wrote: »

nomoredebtplease wrote: »

Statement of Affairs and Personal Balance Sheet
Monthly Expense Details
Mortgage................................ 1800
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 180
Electricity............................. 100 You adjusted to £75
Gas..................................... 100 You adjusted to £75
Oil..................................... 0
Water rates............................. 30
Telephone (land line)................... 15
Mobile phone............................ 100 Cut this to two PAYG phones - total £20/mth
TV Licence.............................. 15
Satellite/Cable TV...................... 40 Get a Freeview box - reduce to £0
Internet Services....................... 20
Groceries etc. ......................... 400
Clothing................................ 50 Make do, and buy children's clothes on ebay - £10/mth
Petrol/diesel........................... 300
Road tax................................ 38
Car Insurance........................... 60 With a cheaper car (as below), you can maybe half - £30
Car maintenance (including MOT)......... 83
Car parking............................. 10
Other travel............................ 0
Childcare/nursery....................... 325 Can you cut this?
Other child related expenses............ 1800 You adjusted to 1250/mth?
Medical (prescriptions, dentist etc).... 47.5
Pet insurance/vet bills................. 30
Buildings insurance..................... 25
Contents insurance...................... 25
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 100 Cut to £10/mth - maybe try some crafts? Or get the children to make gifts?
Haircuts................................ 65 Cut completely if you're brave, or find somewhere that will do a cheap cut for £20 every couple of months. I'll leave you £10/mth here.
Entertainment........................... 200 Per month?! Cut to £50.
Holiday................................. 200 Cut
Emergency fund.......................... 0
Total monthly expenses.................. 6158.5


Assets
Cash.................................... 0
House value (Gross)..................... 525000
Shares and bonds........................ 0
Car(s).................................. 10000 Is this two cars or one? If it's one, sell it and downgrade. You can get a nice car for £2000 and pay off one of your debts.
Other assets............................ 5000 Is this something you really need?
Total Assets............................ 540000

If my calculations are right, that's £1285 of savings (with a few assumptions). I think you can do it without giving up private school (the reduction in fees helped a lot), but it's going to be harsh

If you're able to sell your car and make a few adjustments (e.g. car/elec), it might be worth posting a revised SOA. I think you have the potential to find the savings you need, but it's going to be a huge change in lifestyle for the whole family.

Without adjusting your mortgage or income, your choice is:
i) Keep your lifestyle and give up private school (at 5yo, I honestly don't think it'll be the end of the world for your kids).
ii) Keep private school and make serious cuts everywhere else.

roundabouthere

Just out of interest your mortgage payments appear very low. From the figures you're provided this would equate to about a 35 year mortgage left to run. Are you maybe paying interest only and planning on seriously overpaying once the children leave school to reduce this. I know this seems like a minor issue at the moment but you've saddled yourself with a huge debt to be repaid over a very very long time and a lot can happen in that time that could affect the ability to pay.Maybe to resolve two issues, one short term (school fees) and the other long term (large mortgage) the best solution would be to downsize the house.You can always look to move back to a larger house once you've paid off the outstanding unsecured loans which then would free up a huge amount of your monthly income. (PS I don't know why this has all come out as one large chunk of text as i've tried to change it but its not playing ball)