Repayment to Interest Only

getmore4less

DO a SOA and use that format on here.

It is much easier for people to see where you are.
and it will help you see the picture better.

This was recomended over 2 months ago

http://forums.moneysavingexpert.com/showpost.php?p=68716899&postcount=10

get the numbers down on the SOA without the words much easier to see whats going on.

Thrugelmir

Noobie2011 wrote: »

But is there a risk if I divulge this debt to them, some of which was taken out after the Mortgage which includes the 2nd charge loan could they do me for breach of the Mortgage

Your lender has to give approval for the 2nd charge to placed on the property.

Your mortgage lender will expect you to take action with regards to your unsecured debt first. There's no disgrace in a DMP or entering repayments plans with each lender individually.

andys15

Oh I have a lot more debt than you have, so not looking down my nose at you. The situation you are in, then the tiny effect going interest only is not worth it. It won't touch the sides. Priority is the house. I think you need to either increase your income, and if that is not possible, then you need to get professional help straight away. The loans etc are fine as they have an end date. The biggest problem is when you start getting the letters from the credit cards stating that they are increasing the rate. And no doubt they would probably do that, just as you get the mortgage switched to interest only.

andys15

Noobie2011 wrote: »

I am where I am and getting the sofas and car was not a good idea if everything we did was good idea then none of us would be in a mess in the 1st place. I accept where I am and that it is all my fault and need to sort it. Selling my car is not an option as I am on finance and returning is not possible either as far as I have been told. I have been selling quite a few things to pay off debts etc so have looked into selling a couch but what I could get I don't know.

Sorry I don't agree with this. As I say I am in a lot of debt, but it is all manageable and was accounted so I knew I could easily afford the repayment. I sympathise with people with debt when they have had a change of circumstances for the worse, but people getting into debt to buy luxuries without a plan on how they will pay it back, is reckless and selfish. I have known people buy luxuries(sofas, expensive holidays) knowing that they will be doing a DMP in a few months. How is that fair?

Thrugelmir

andys15 wrote: »

I have known people buy luxuries(sofas, expensive holidays) knowing that they will be doing a DMP in a few months. How is that fair?

DMP will result in legacy issues in the years to follow. There's no such thing as a free lunch.

andys15

Thrugelmir wrote: »

DMP will result in legacy issues in the years to follow. There's no such thing as a free lunch.

Maybe so. But if they don't intend to move, and apply for anymore credit( they couldn't have anyway), then what problems does it cause? It seems you wait the magical 6 years and all is forgiven. And they still got the holiday of a lifetime.

Noobie2011

andys15 wrote: »

Sorry I don't agree with this. As I say I am in a lot of debt, but it is all manageable and was accounted so I knew I could easily afford the repayment. I sympathise with people with debt when they have had a change of circumstances for the worse, but people getting into debt to buy luxuries without a plan on how they will pay it back, is reckless and selfish. I have known people buy luxuries(sofas, expensive holidays) knowing that they will be doing a DMP in a few months. How is that fair?

I appreciate your help but we will disagree on this as how can you disagree with the fact I admitting the mistakes I made and that it is my responsibility to sort them. Also I could turn to a DMP but would rather sort it myself and not take an easier route of declaring I am in trouble and looking to just reduce payments as how will that help in the long run

getmore4less

All you have talked about is the debt

The income and the spending, is where the solution is.

Get that SOA done.

Noobie2011

So have done an SOA and the results are below if I have done it correctly

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household.........
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 1767
Partners monthly income after tax....... 1794
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 3561

Monthly Expense Details
Mortgage................................ 720
Secured/HP loan repayments.............. 385
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 200
Electricity............................. 30
Gas..................................... 30
Oil..................................... 0
Water rates............................. 40
Telephone (land line)................... 0
Mobile phone............................ 100
TV Licence.............................. 12.12
Satellite/Cable TV...................... 30
Internet Services....................... 0
Groceries etc. ......................... 200
Clothing................................ 1
Petrol/diesel........................... 200
Road tax................................ 23
Car Insurance........................... 66
Car maintenance (including MOT)......... 5
Car parking............................. 0
Other travel............................ 5
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 15
Pet insurance/vet bills................. 35
Buildings insurance..................... 15
Contents insurance...................... 15
Life assurance ......................... 25
Other insurance......................... 0
Presents (birthday, christmas etc)...... 5
Haircuts................................ 10
Entertainment........................... 50
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 2217.12


Assets
Cash.................................... 0
House value (Gross)..................... 131000
Shares and bonds........................ 0
Car(s).................................. 10000
Other assets............................ 0
Total Assets............................ 141000


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 111000...(720)......0
Secured Debt.................. 16000....(385)......0
Total secured & HP debts...... 127000....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
118118 Money...................5000......255.......0
Creation.......................2400......60........0
Fashionworld...................3000......140.......0
Car Loan.......................14000.....250.......0
Ocean..........................1000......48........0
Vanquis 1......................2000......90........0
Vanquis........................500.......45........0
Aqua...........................850.......35........0
Capital One 1..................200.......6.........0
Capital One....................2550......100.......0
Barclay 2......................1200......43........0
Barclay 1......................5000......122.......0
Barclay........................1200......43........0
Total unsecured debts..........38900.....1237......-


Monthly Budget Summary
Total monthly income.................... 3,561
Expenses (including HP & secured debts). 2,217.12
Available for debt repayments........... 1,343.88
Monthly UNsecured debt repayments....... 1,237
Amount left after debt repayments....... 106.88

Personal Balance Sheet Summary
Total assets (things you own)........... 141,000
Total HP & Secured debt................. -127,000
Total Unsecured debt.................... -38,900
Net Assets.............................. -24,900

Created using the SOA calculator at https://www.stoozing.com.
Reproduced on Moneysavingexpert with permission, using Firefox browser.

andys15

What are the interest rates in the cards? That would be my biggest concern, especially if they start increasing them. They usually wait until you are maxed out, and then increase. I suppose you don't have to accept the increase, but you can never use them again. If the car is worth 10k, you owe 14k in it, then you need to give it up. If it's on pcp you can hand it back after you have repaid over 50%. Obviously the mobile phones have to go and the entertainment. With so little available at the end of the month you cannot sustain this. The car needing new tyres or your washing machine breaking will send you over the edge. I think you really need to speak to someone today. Going interest only and cutting back here and there will not help. The credit card debt will never get lower.