Desperately wanting a better quality of life for my kids

Elliotts

Damn, where do i start?
Yes I, no I should say WE have admitted that we have a debt problem. we have known this for some time but have continually taken the wrong advice(in hinesight).
Bottom line is, we own our house, we love our house, its not a palace but it's ours....but the way things are going, probably not for much longer.

I can't believ that for a coupe with 3 fantastic kids, that it is going to resort to selling our house and renting. If it is what we MUST do then i have no problem with doing so, but there must be a way out!

OK whats our SOA (see i did read the beginning bit)

Income
Mine £1300
Wife £695
Other income
CSA £165
Child Benefit £163
CTax Credit £82

Total £2405


Expenditure
Mortgage £917.86 - £126,000 with a redemption of £6000 - Property value £165,000
Secured Loan £465.32 £26,000
Mortgage Endowment –Should have one but we can’t afford it
Personal Loan (£2000) £77.70
Capital One His (Balance £1444.37) £65 – Is what we were paying till this month
Capital One Hers (Balance £1070.95) £50 - Ditto
Barclaycard (Balance £145) £5.00
Water £41.86
Council Tax £91.00
Gas £30.00
Electricity £40.00
Building/Contents Insurance £64.76
Telephone (Including Mobile) £45.00
TV Licence, Satellite, Rental £113.28 (this includes renting our washing machine , tumble dryer and TV )
Service Contracts £15.00 (British Gas)
Motoring Costs - Fuel & Parking £345.00 (I work 50miles from home!)
Car Insurance £73.78
Other Travelling Costs £18.40
Food & Housekeeping £220.00 (It’s all we can afford)
Clothing & Footwear £21.00 (Catalogues)
Other Personal Expenditure £35.00 (Includes £22.00 specsavers contact lenses and a £13.00 takeaway to make us feel human)

Total £2739.00

You see we dont go out at all, and i mean 'at all', we dont rent DVD's, we don't eat out, sadly SKY is the families entertainment!

We do have diverse credit rating due to going with Bains and ernst Debt management company, which ended in us getting two CCJ's and losing even more money. Paid off now over 4 years ago!

We were (very politely) told by the CCCS to reduce our outgoings) or sell up.

Is this really all we can do?

Should I not be trying to keep the one real investment we have?

Even if we do sell, won't the letting agents need to do a credit check!

Is getting a remortgage on a decent rate the way out! (oh sorry, were not eligible)

HELP!!!!

Seaxwyn

HI Elliotts

Well done for posting - you will get some great help on here and maybe the situation is not so dire as you think.

I'm no expert but things that leapt out to me:

- wife's earnings. It looks as if she is working part-time or in a very low paid job. Could she earn more? Get a second job maybe?

- tax credits - are you getting the right amount? Our income is higher than yours and we get £238/month

- car costs - really high! How many cars is this? Could you manage with only one car? Our car insurance is £21/month for one car (two drivers). This looks like an area where you could make big savings.

That's it from me but much more knowledgeable people will be along soon.

Good luck with it

Little_Miss_Winner

Hi there and welcome to mse :wave:

I think the main question which you are asking is that is selling your home the only option for you.

I have had a quick look at your SOA, and as you already know there is a deficit each month.
If you want to keep the house then you have only one option, to bring home more money than you spend...

SO;-
Income.
Can either of you get better paid jobs/ part-time work / overtime?
What about selling everything you don't use/need/want on ebay to raise extra funds?
Use all the cashback/survery sites to earn a little extra.
Use all coupons/discount codes for shopping.

Outgoings
Other Personal Expenditure £35.00 (Includes £22.00 specsavers contact lenses and a £13.00 takeaway to make us feel human) - These will have to stop..
Clothing & Footwear £21.00 (Catalogues) - Stop these as well
Service Contracts £15.00 (British Gas) - Cancel!!
TV Licence, Satellite, Rental £113.28 (this includes renting our washing machine , tumble dryer and TV ) - Can you not buy cheaper 2nd hand models to tide you over? these 3 add up to £1359 per year!!!


It's the little changes which all add up to big bucks..

How much apr do you pay on your loans/cc's? If you dig all the paperwork out and list the apr's we will have a bigger picture of what percentage you re-pay each month...

Keep posting, it will all work out, I'm sure
Hugs

zipwen1

with your mortgage are you entitled to payment holidays?

jessie-jane

Hi Elliotts, just wanted to say that we were in a similar position before christmas.
Our teenage son didnt want to move to a new house away from his friends and school so fortunately we were in the position to sell and rent our old house back without anybody else knowing our business. We have been lucky,in the fact that our new landlord has agreed a 3 year fixed rent for us as well so at least we have this as peace of mind.
OH cant help thinking if we did the right thing but i have no doubt in my mind and at least now we can concentrate on the small aount of debt we still have.

good luck

jessie-jane

Seaxwyn- hope you dont mind me asking but ho do you manage to get the tax credits ( are these working or child )?

we earn approx 24000 between us and are only entitled to 10.50 a week child tax credit but not working tax credit

thanks

jessie-jane

lynzpower

your buildings & contetns cover is very high indeed.

I suggest 30pcm is more like what you shuld be paying, Have a hunt about on confused.com for the chepeast, then join quidco. & swap suppler and get cash back.
https://www.quidco.com

I would hand back your dryer in any case, use the washing line, summer is her3e, use indoor airers, tumble dryers cost a fortune in electic too.

what ahve you got to sell ? ebay, amazon carboot.

get rid of the catalogues, they are overpriced only buy what you absoutley NEED, and go for charity shops, matalan, asda etc primark for the essentials.

danielleindebt

hi and welcome, im sure you'll find it helpfull here.

i have just renewed my house/building insurance and it cost £27 a month (previously £39)

i also had to cancel our life insurance for a while.

i would also had the dryer back if you can i know there great but costs loadsa elec and a washine line is just as good.

good luck and keep on posting .. its a great help

Sus1e

Do you have any bank charges you can claim back?

These might gove you a lump sum which you could use as full and final payments on some of the debts/loans.

Have a look at the bank charges forum for more info.

Dithering_Dad

Would it be such a bad thing to sell your house and rent instead? I have worked a lot in Europe (I'm in Norway as I type this) and the majority of my work collegues rent their houses. These are middle class, executives who are well educated and highly paid (there is no stigma attached to renting). They all think the Brits are mad to be so obsessed with home ownership and to a certain extent I have to agree with them.

You're paying £1383.18 a month on a mortgage and secured loan and have £2405 income. This means you are paying almost 60% of your income on property related loan repayment. If you don't have a fixed rate mortgage, this will only get worse. You have mentioned that you don't have an endowment but should have, so clearly part of your mortgage is Interest Only and so is not being paid off. If this amount was being paid off it would increase the 60% even higher. This is the cost of your home ownership.

Contrast this with renting. I don't know where you live, but in Stockport Manchester, you can rent a 4 bed detached house for £850, with no water rates and no buildings insurance to pay. You could move closer to where you work, reducing the travel costs significantly. These savings could then be used to provide a better lifestyle for your family.

By selling your home you could pay off all of your debts and start using the money that you are currently wasting on loan & interest payments to do what your initial post stated: "Giving a better quality of life for my kids".

You have to ask the question. Does the fact that we "own" our own home have a positive impact on our quality of life? You must be constantly worried about your debt, you never go out and you seem to have a life constantly geared to debt repayment. It would suggest that it doesn't have a positive impact at all.

The bottom line is that you simply cannot afford home ownership and by trying to achieve this you are just committing yourself to a lifetime of financial misery.

Seaxwyn

Hi jessie jane

I've PMed you re the tax credits question.