Going under and don't know what to do

decking

I am a new poster seeking some kind of advice or maybe just to find others in the same boat.

We have a £175k mortgage and £30k debt in credit cards mainly run up because of our young child's nursery fees for the last 4 years (we are in the South East and the least we ever paid each month was £700 and the most £900). Also we refixed our mortgage for 5 years in the summer of 2008 when all the signs were the rates were just going to keep going up and up onto a ruinous 6.2% and were subsequently unable to get out of it no matter what we tried - remortgaging etc didn't work as by that point we had debt and the house valuations didn't go in our favour.

Our salaries are bog standard and between us we earn £48k per annum. The minimum repayments on the debt have become crippling and we are only just managing to make it to the end of the month without exceeding our overdraft limit.

I went to see our mortgage provider today to see if we could remortgage to clear the debt as we have £90k equity in the house. Whilst they couldn't lend the whole amount it looked like 60% of it might be possible until I said my husband did a salary sacrifice of £180 per month for our after school childminder - this then pushed us below affordability levels and they said they couldn't lend us anything. I'm ashamed that I started to cry in front of the very young (and pleasant) mortgage adviser I feel so hopeless and cannot see how we are ever going to repay the debts and get back to a time when we have money left from our salaries.

The only ray of hope is that in 2011 we switched to interest only on the main part of the mortgage as this was the only way we could afford to keep paying it. The fixed rate ends in August but with all the news about clamp downs on interest only mortgages I am now terrified they will force us back to repayment which would be impossible for us...

Not really sure what I expect anyone to say to me but just feel so hopeless and whenever I try and talk about it I end up crying so posting feels easier... just so worried about the impact on our 5 year old if the worst happens and we lose the house...

moohound

Hi,and welcome to he forum, there will be a solution but it might not be quick and it might not be easy.

Start by posting a statement of affairs, third sticky from the top showing you income and outgoings, are you still paying for child care now you little one is at school?

There are lots of smart people here with good ideas.

If you outgoings are more than your income you might need to contact one of the debt charities like StepChange or CAP.

You have taken the first step, so post the SOA and we'll try and help, you are by no means the only ones in this situation, we have all been there.

kittiej

Ok Ok, don't panic because nothing is ever resolved in the moment of panic at this time of day there is absolutely nothing you can do so have a good night's sleep too

Right so let's look at the facts ;

Do not convert unsecured debt into secured debt (rule no 1)

I cannot say this often enough but when there are whole countries out there close to or going bankrupt then your personal debt it a drop in the ocean.

Tell us what other debt you carry so we can help - failing that go onto Stepchange's debt remedy to see what it says.

You will be OK x

amcg100

Being in debt is not a crime or does it mean you are not worthwhile and capable people. It just means that you have been a little careless in one part of your lives, and perhaps do not have good money management skills. Unfortunately banks will try to humiliate you, but you should be robust and always remember you are better than them. Just because one lender refuses does not mean everyone will. You could try a mortgage broker who will check practically every deal on the market and is bound to find you some kind of proposition. A £30 K debt with £90 K equity should be easy to manage.

Keep trying, and keep your self respect. Dont let financial institutions push you around, they are just clerks and accountants with a big ego and little respect for other people.

amcg100

kittiej wrote: »

Ok Ok, don't panic because nothing is ever resolved in the moment of panic at this time of day there is absolutely nothing you can do so have a good night's sleep too

Right so let's look at the facts ;

Do not convert unsecured debt into secured debt (rule no 1)

There is no such thing as unsecured debt - courts would put a charge on a property for any kind of debt regardless of whether the property was offered as a security.

decking

Thanks so much for the replies - it does feel better to know I am not the only one in this position.

Will fill out the SOA and see what the advice is...

decking

Sorry where do I find the SOA??

kittiej

There is no such thing as unsecured debt - courts would put a charge on a property for any kind of debt regardless of whether the property was offered as a security.

I concur however I don't think OP is at that stage currently and has mentioned consolidation.

Let's not get ahead of ourselves by mentioning courts etc. OP is a noobie and doesn't need scaring half to death unnecessarily.

I'm not being picky - just saying how it appears unless OP tells us differently. I would go so far as to say that all money is debt and it doesn't exist but there's no need for me to muddy the waters

moohound

Sorry got muddled up, it's the medication;) the SOA is here

http://www.stoozing.com/calculator/

I can't figure out how to post links with the iPad sorry

kittiej

http://www.stoozing.com/calculator/soa.php complete and hit the MSE tab at the end.

Pink_Fairy_2

decking wrote: »

I am a new poster seeking some kind of advice or maybe just to find others in the same boat.

Hi Decking

I don't post on here very often, I think I'm what's known as a "lurker". You've taken a very brave step by posting on here in the first place. As someone else has replied, there will be a solution which may be neither quick nor easy, but there are many clever, capable people on here who will offer non-judgmental advice. I found StepChange extremely helpful and supportive and can now see some light at the end of what did appear to be a very dark tunnel. You will get there and things will improve, but you will need to be honest and ruthless. Congratulations for facing up to things. :T