Going under and don't know what to do

moohound

Don't freak out about charging orders and forced sales and stuff, I owed £39000, and all my creditors (nine in total) were fine(ish) and reasonably supportive. My largest one was £12000 and there was no hint of anything being linked with my house, it would have taken 10 years to pay it off without the full and finals.

moohound

kittiej wrote: »

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

See, I said there were smart people here:)

decking

Will post up SOA tomorrow - not facing any court action or anything like that yet - just frightened as we only making minimum repayments and the amount of money we are supposed to have left over every month for food, petrol, commuting etc etc gets smaller and smaller (in reality we are into our overdraft everymonth within a few days of being paid). Thanks again

kittiej

I have to disagree Moohound, but thank you for your kind words :T

moohound

decking wrote: »

Will post up SOA tomorrow - not facing any court action or anything like that yet - just frightened as we only making minimum repayments and the amount of money we are supposed to have left over every month for food, petrol, commuting etc etc gets smaller and smaller (in reality we are into our overdraft everymonth within a few days of being paid). Thanks again

This is similar to how I was, it was spiralling out of control, I sincerely wish I had sorted it out earlier, instead of trying to manage it for too long.

racing_blue

decking wrote: »

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...

Looking at your situation with the objective eye of a complete stranger, one solution involves selling your house. Shrug off that expensive mortgage. Use your £90K of equity to repay your £30K of credit card debt. Then buy a new house with a £50K deposit and a cheaper mortgage. Keep the £10k change as an emergency fund and never use those credit cards again.

If you don't want to do that, increase your income. Plenty of ways to boost income. Overtime, promotion, more responsibility, moonlighting, career change, sidelines, consultancy, etc etc. It is a mind shift. Don't think "we earn £48k" - think "last year we earned £48k and next year we need to earn £65k and this is our plan". Then, start paying off that credit card debt while maintaining or reducing expenditure. As your debt shrinks, there will quickly come the point where you are good for a remortgage & with rates at around 2.5% this will be a game changer.

I wish you fortune and happiness as you overcome this maths problem (that's all it is) & get on with your rich and fulfilling lives- please don't let it get you down.

moohound

You mentioned the interest only mortgage, do you have something in place to clear it at the end of he term?

bouncydog1

moohound wrote: »

You mentioned the interest only mortgage, do you have something in place to clear it at the end of he term?

Let's have a look at the SOA first rather than worrying about paying off the mortgage!

OP - we are here to help. Some advice will be blunt as necessities to one person are waste to another! However a problem shared is there to be sorted so the sooner you can get your SOA done the better.:)