Can't see the wood for the trees ...

NinaBee65

Am stuck between a rock and a hard place and would really appreciate some honest thoughts!! I'm considering a DMP although am worried about the impact on my credit score - my current mortgage deal ends in 2 years and a DMP would greatly reduce my opportunities for another deal. Rather than opt for a DMP right now, I'm considering trying to review/revise my spending over the next 3 - 6 months plus get a couple of 0% balance transfer credit cards to at least give myself the opportunity of freeing up even the smallest amount of available cash each month.

I live alone and have no dependents - I work full-time and net just over £1814.00 each month. My current outgoings on credit cards and one loan is £708.00 per month. All my credit card and loan payments are up-to-date - no late payments or defaults. Once my mortgage, utilities, insurances are paid as well as credit commitments, I'm left with approx £140 to live on. Should I keep going and see how things are in a few months or opt now for a DMP?

bexster1975

Hello and welcome :hello:

I think the first thing to complete is a statement of affairs (SOA) so all your i comings and outgoings are listed. All your debts and their interest rates. Then the people on the forum will do what they do best and help.

I can't answer your DMP question, but others will be able to help, especially with a SOA.

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

Link to SOA calculator

Good luck

Bexster

NinaBee65

Thank you Bexster - will post up a SOA and look forward to hearing what people think

Chrissie

NinaBee65

Hi - here's my SOA - I've not got the interest rates to hand at the moment however.

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 1
Number of children in household......... 0
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 1814.75
Partners monthly income after tax....... 0 (partner lives in his own house)
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1814.75

Monthly Expense Details
Mortgage................................ 598
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 75
Electricity............................. 60
Gas..................................... 0
Oil..................................... 0
Water rates............................. 23
Telephone (land line)................... 26
Mobile phone............................ 0 (my partner pays this for me)
TV Licence.............................. 12
Satellite/Cable TV...................... 0
Internet Services....................... 26
Groceries etc. ......................... 100
Clothing................................ 0
Petrol/diesel........................... 30
Road tax................................ 13
Car Insurance........................... 15
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 7
Buildings insurance..................... 5
Contents insurance...................... 4
Life assurance ......................... 15
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 15
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Plumbing cover.......................... 6
Total monthly expenses.................. 1030

Assets
Cash.................................... 0
House value (Gross)..................... 160000
Shares and bonds........................ 0
Car(s).................................. 500
Other assets............................ 0
Total Assets............................ 160500


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 114877...(598)......1.84
Total secured & HP debts...... 114877....-.........-

Unsecured Debts
Description................. ...Debt......Monthly...APR
Nat West Loan..................14211.....268.. .....0
Nat West Credit Card.........3330......75..... ...0
Argos Store Card...............1237......42.... ....0
Nationwide Cred Card.......2900......50.... ....0
Next.......................... .2000......103.. .....0
MBNA...................... .....2100......47... .....0
Cap One Credit Card..........2700......92.... ....0
Asda Credit Card...............900...... .25..... ...0
Total unsecured debts........29378.....702.......-

Monthly Budget Summary
Total monthly income.................... 1,814.75
Expenses (including HP & secured debts). 1,030
Available for debt repayments........... 784.75
Monthly UNsecured debt repayments....... 702
Amount left after debt repayments....... 82.75

Personal Balance Sheet Summary
Total assets (things you own)........... 160,500
Total HP & Secured debt................. -114,877
Total Unsecured debt.................... -29,378
Net Assets.............................. 16,245

All thoughts and suggestions will be gratefully received
Chrissie

dresdendave

At first glance none of your spending seem particularly extravagant. Hopefully you have done the basics such as claiming single person discount for council tax, checked you are on the best deal for utilities and generally a single dweller is better off with metered water.


It seems you are making all your payments, just that you have little left over. As you have no dependents, could you get evening work in a bar or restaurant to increase your income?


How many months are left on the loan? Once this is paid that is a big chunk of money that will be available to attack those credit card bills.


Good luck.

rogue999

Could you see you and your partner moving in together at any point? It would be a good way to cut the bills for both of you - can appreciate this may not be appropriate/possible though but something to think about.

ellesbellesxxx

Your phone and Internet add up to over 50 a month... Plus your mobile (I know you don't pay for it but still)
Have a look at phone internet section here, that could be easily cut back

QueenBeruthiel

If you are only spending £30 pm on petrol, then your car must be barely used. Could you sell it?

andyfromotley

Hi Nina,

your SOA isn't too bad, a bit of savings as recommended above but these are not going solve your problems. However is your SOA accurate? You have a huge amount of debt and it looks like the type that was built up gradually over time by overspending each month? If this is the case you need to face up to this and spend as per your SOA. Is your debt still increasing?

The good news is that you are solvent. You can afford to pay your bills and have a tiny bit left over, so over time just doing this, particularly with a remortgage and as things get paid off you will become debt free.

However thats pretty tight and will take a long time! So here are some pointers that may help you. If you are eligible get as much of your debt as you can onto 0% balance transfer cards. This will make a huge difference. If you have high APR's try to transfer the balance to the lowest one.

What is the loan for?

Is the value of your car accurate? You haven't put anything for MOT servicing? Could you live without a car? It offers significant savings for you if you can.

Do you have stuff that you can sell? What did you buy on the credit.

The biggest single thing you can do is to increase your income. Work - ask for a rise, seek promotion, overtime? Look for a new better paying job? Are you able to take on a second or even third job? This will undoubtedly have the biggest impact on your ability to pay this debt.

Check out dave ramsey for inspiration on tackling debt. There is no magic financial wand which will make this go away. you need to earn more, live on less and pay that sucker off!!

Hope this helps.

NinaBee65

Hi - thank you for your feedback.. You're absolutely right - most of the debt has built up through overspending on non-essentials. The loan, and a very small percentage of the credit card debt, was for renovations to my cottage. Taking on some extra work on a weekend will help - I've started looking.

I sold lots of stuff on Ebay recently and made several hundred pounds which went to my electricity debt. I'm not a fan of Ebay however given what they take in fees - Gumtree is a more cost effective way to sell stuff.

I will review my SOA - petrol costs are low as I'm able to work from home and don't drive the 10 miles to my workbase everyday.

I think I need to explore other options at the mo rather than take the DMP route right now

theoretica

NinaBee65 wrote: »

Gumtree is a more cost effective way to sell stuff.

Very true - but some sorts of stuff will sell for more on ebay so it can be worth the fees.