First time poster - needing support!

Always-stressed

Hello, as the title suggested I've never posted here before - I am in so much debt I cannot see a way out, I'm 25 barely leave the house (Except to work), due to not being able to afford to do things, my debt is crippling me and I thought I'd post on here with the hope of some solid advice to help!

The information below is my financial situation - its been very hard to post this, to admit I am in an uncontrollable situation.

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................ 1300
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1300

Monthly Expense Details
Mortgage................................ 315
Secured/HP loan repayments.............. 175
Rent.................................... 0
Management charge (leasehold property).. 70
Council tax............................. 75
Electricity............................. 40
Gas..................................... 30
Oil..................................... 0
Water rates............................. 30
Telephone (land line)................... 17
Mobile phone............................ 20
TV Licence.............................. 12
Satellite/Cable TV...................... 0
Internet Services....................... 13
Groceries etc. ......................... 100
Clothing................................ 0
Petrol/diesel........................... 30
Road tax................................ 12
Car Insurance........................... 60
Car maintenance (including MOT)......... 30
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 8
Pet insurance/vet bills................. 10
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 10
Haircuts................................ 10
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 1067


Assets
Cash.................................... 0
House value (Gross)..................... 80000
Shares and bonds........................ 0
Car(s).................................. 2000
Other assets............................ 0
Total Assets............................ 82000


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 60000....(315)......4.9
Hire Purchase (HP) debt ...... 6000.....(175)......3.9
Total secured & HP debts...... 66000.....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Barclaycard....................7200......180.......19.9
Aqua...........................4000......160.......32.9
Loan...........................11300.....244.......15.9
Overdraft......................2250......40........0
Credit Union...................800.......70........19.9
Total unsecured debts..........25550.....694.......-


Monthly Budget Summary
Total monthly income.................... 1,300
Expenses (including HP & secured debts). 1,067
Available for debt repayments........... 233
Monthly UNsecured debt repayments....... 694
Amount short for making debt repayments. -461

Personal Balance Sheet Summary
Total assets (things you own)........... 82,000
Total HP & Secured debt................. -66,000
Total Unsecured debt.................... -25,550
Net Assets.............................. -9,550

Reproduced on Moneysavingexpert with permission, using other browser.[/i]

HappyMJ

Ouch £91,000 of debt on take home pay of £300 a week.

My advice. First - get more income if you can. If not then sell house, rent small flat, return car on HP, go Bankrupt and start again. You've taken on far too much debt compared to your income. You could go on a DMP but you'll be paying £213 a month for more than 10 years which in my opinion is not worth it. A bankruptcy would be off your credit record in 6 years and you can buy a house and start again.

Your expenses already look quite good. Just a few minor tweaks but generally quite good.

sourcrates

Have to say I agree with Happy MJ.

Although there are people on this forum that are in, or have completed, ten years or more in a DMP, I think personally that is far too long to be in debt management.

It's a tough decision to make, but dire situations require drastic action.

La_escocesa

Hi there,

Well done for posting. :A I'm sure lots of people will be along with some more advice for you too.

Do you have a spare room and could you take in a lodger? What about a second job? If you're not going out because of all your debts then maybe a second job would be perfect - bar/restaurant job would keep you busy on the weekends.

Is the HP £175 a week your car? I got rid of mine a few years ago and hired one when I needed it - only cost me about £200 in car hire fees that year rather than almost that per month.

Always-stressed

Thank you very much for the quick replies!

I am very afraid to go bankrupt - but I'm currently researching the possibility of it now

The above information is monthly - I've not defaulted on anything yet!

Is a DMP, like an IVA (I am currently inputting details into step change) and it suggests 5year for an IVA?!?!

Kitten868

Let's focus on positives - you're only 25 and you've got a mortgage on your own! That's brilliant. Makes it cheaper for you than renting. The debt not so much but you can do this. I think it may be worth talking to a debt charity for some advice but it doesn't have to mean a DMP.
I would definitely consider a lodger that would bring in enough to keep up to date with your payments. X

Maximum_Saving

Well done for posting this. I would like to say that you are doing very well with your expenses. You are just 25 years old and on your own. You are so amazing for having a mortgage because it lets you live cheaper than renting. You might consider getting in a lodger, selling things on E Bay or getting a second job. If you have an extra £300 to £400 pounds a month then you could get rid of some of your shortfall on your debt payments. See if you could speak to Citizens Advice or a Debt Charity. Good luck.

sourcrates

Always-stressed wrote: »

Thank you very much for the quick replies!

I am very afraid to go bankrupt - but I'm currently researching the possibility of it now

The above information is monthly - I've not defaulted on anything yet!

Is a DMP, like an IVA (I am currently inputting details into step change) and it suggests 5year for an IVA?!?!

No,

A DMP is an informal agreement between you and your creditors to repay your debt at a lower level than normal.

An IVA is a more formal solution, a form of insolvency, where you pay a monthly amount for 5/6 years, at the end of which any remaining debt is written off.
You also get legal protection from your creditors, in a DMP you don't.

fatbelly

I generally agree with the other posters but in your situation I would consider a DMP. Yes, it would take a long time to get debt-free but you already have 20k equity in your property against 25k on non-priority debt, so I would not be looking at bankruptcy.

Also, usually, I am not a big fan of IVAs - too many mis-sold. But they are a form of bankruptcy for someone who is insolvent but needs to protect something, like a house. I can see one working for you. Why don't you ask on the IVA board?

January2015

I wouldn't sell. You have a roof over your head, which one day will be yours. The amount you pay is reasonable - if you sell you would most likely pay more in rent. You are on the housing ladder - I would stay on it.

My personal choice would be to go on a DMP. Don't worry how long it will take - things changes and the debt free date will adjust as you go along.

This is just my opinion, and I appreciate others would advise not to look to a DMP with that many years. You have to take the advice (here and professional debt advice agencies) and decide what will work for you.

Jon_B_2

I don't know where you live, but I would not consider bankruptcy just yet.

You have an asset, that all being well should appreciate. I don't know where you live, but good luck finding somewhere to rent for £315/month. You'll be an ex-bankrupt be paying a bomb on rent.

I'd see what the debt charities say, but bankruptcy sounds like it could be even more problematic long term. Where I live a 2 bed flat commands nearly £600 in rent, that's nearly half your income.