SOA - Any advice appreciated.

AndyBob

Statement of Affairs and Personal Balance Sheet

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

Monthly Income Details
Monthly income after tax................ 0
Partners monthly income after tax... 960
Benefits.....Disability...................... 521
Total monthly income.................... 1481

Monthly Expense Details
Rent....................................... 500
Council tax.............................. 21
Electricity................................ 50
Gas........................................ 20
Water rates............................. 60
Telephone (land line)................ 18
Mobile phone........................... 40
TV Licence............................... 13
Satellite/Cable TV..................... 35
Groceries etc. ......................... 100
Petrol/diesel............................ 30
Road tax................................. 24
Car Insurance.......................... 32
Car maintenance ..................... 27
Other insurance....................... 10
Total monthly expenses............ 953


Unsecured Debts
Description....................Debt......Monthly...APR
Lloyds Loan....................4764.....150........20.8
118 Loan.......................1579......198........35.9
Lloyds Overdraft.............2000......19.........19.94
Lloyds CC......................1969......59..........25.95
Barclays CC....................764.08..18..........0
Tesco CC.......................1019......40..........0
Littlewoods Catalogue......1043.....138........0
Sunny Payday Loan.........345.......69..........875.3
Payday UK Payday Loan....406......203........1217
Total monthly Debt......... 894

Total monthly IN.............. 1481
Total monthly OUT........... 1847

HappyMJ

Do you own anything?

If not just take out a DRO or Bankruptcy if the total outstanding debt is too high. Everything will be written off and you can start again.

You have a lot of missing expenses. For example you've allocated nothing to Clothing. You've got nothing for Holidays or Entertainment.

£100 a month for all of your groceries is commendable but does it really include everything you buy. If you do go for a DRO or Bankruptcy you can put a much higher figure such as £300 a month or more which will give you enough money for a healthy diet and enough for all of your household essentials.

AndyBob

Own nothing of value, sold anything we could of value to help get through.

As for clothes and entertainment we make do with what we have.

100 for groceries is a little tight to manage but manageable.

I am thinking that a DMP might be the best option.

Pixie5740

If you use the Debt Remedy tool on Step Change's website it will tell you whether a DMP is the way to go or perhaps some other debt solution.

http://www.stepchange.org/Debtremedy.aspx

You are right about needing a debt solution as your SOA is already very lean so there isn't another way of plugging that £400 gap.

Good luck whichever route you choose.

m4rc

Your efforts are commendable, the only reason to not go bankrupt would be your own ethical reasons. I personally think not bein able to get credit for a while would be positive, and in theory your income without the debt means you can get by just fine and spend a little more on groceries etc and put some away each month.

If you want to clear the debt, it's not impossible. The payday loans are a pain as they can escalate so need to go ASAP. StepChange would really be able to help, the reality is once the two payday loans are gone your debt is just over 13k but obviously win the interest it's going to cost a lot more than that. If StepChange could help you to get the interest frozen and you can come to arrangements I think you could clear the debts in a few years plus not have to love quite as lean as you have stated. I don't think StepChange will let you have £100 for groceries, you need to be realistic and eat properly, especially if someone has disabilities - you need to take care of your health and wellbeing regardless, and struggling on won't help your mental health.

Personally - I'd go bankrupt, you won't lose anything of value, you don't own your house. Some don't like it, I did it as I had no other way out. If not you need help from someone like Step Change and they can help get things sorted.

Good luck

EssexHebridean

Looking at your SOA the picture isn't good is it - you've got a large shortfall between what comes in, and what you need to have going out. Do I take it that it's due to your being unable to work currently that the debts have arisen? Is there an end-date in sight when you may be able to return to work or is this going to be the picture for the foreseeable future?

Do you need to have the car as an essential? That's currently eating into your income a heck of a lot and that's without accounting for things going wrong with it. You're showing £27 a month for car maintenance but no cash assets - where is that money going currently? If that SOA is a picture of what you'd like to be happening, rather than what actually is happening, then it's not helping you, better if that's the case to re-do it as an honest picture, then make adjustments going forwards. The car though is currently costing you nearly 1/12th of your annual income once fuel is factored in - and that's a high proportion bearing in mind the income level. Are you possibly eligible for a motobility or similar scheme car which may prove cheaper to run? No idea what the stipulations on that are though so apologies if it's not feasible for you.

Your water rates are high - can you get onto a meter to cut that? other than that from the limited SOA you've posted the only realistic cuts are the mobiles & satellite TV but even losing both of those totally will only give you an additional £75.00.

One note - you say you make do with what you have for clothes etc, but there is a debt showing of over £1k to Littlewoods catalogue - maybe think about what that relates to and if the earlier statement about making do with what you have for clothes, household goods etc actually holds as true as you think it does. Oh, and tear up the catalogue right now!

Good luck - I hope you find a way forwards.

National_Debtline

Hi AndyBob and thanks for sharing your SoA.


I would echo those who have observed that your budget looks a little on the spartan side. Keeping household costs down to a minimum is doable enough in the short term, but in my experience a tight budget can be very difficult to sustain over the sort of timescale that a debt-management plan would require to clear these debts in full. Even if you can eke out £400 of disposable income per month, it would take three years to clear your current debts - and that's assuming no further interest or charges are added. Is there enough at risk to justify trying to commit to a payment plan for this long or longer, as opposed to declaring yourself insolvent? That is one of the questions you must ask yourself.


Re: EssexHebridean's suggestion re: a car under the Motability scheme. You can quickly check your eligibility by visiting


http://www.motability.co.uk/understanding-the-scheme/eligibility/


Dennis
@natdebtline

m4rc

Great advice from Dennis.

Motability would be a good option if you recieve the higher rate mobility component of Disability Living Allowance or the Enhanced Rate for Personal Independence Payments. You basically give up most or all of the amount you get for the mobility component and in turn get a car for your personal use, all you pay for is the fuel.

However the £521 you list for disability benefits doesn't equate from any combination of DLA or PIP components, so I wonder if it is ESA? Have you had a benefits assessment and know what else you are entitled to? It may be that you can get help with rent, council tax, adaptations and other things. It depends on your disability and the support you need. If your partner works full time sadly and stupidly they can't be classed as your carer so under government definition so can't claim carers allowance - even through they may be caring for you every second of the day they are not at work, it's a stupid rule. However they are your carer if they provide care and/or support, this can take on numerous forms and be emotional, physical, helping with your bills and chores and more. They can ask the local authority for a carers assessment and you should tell them you are struggling financially. If you meet their criteria (moving goalposts I'm afraid, blame the government for taking away all their money so they now can't afford to help most people with disabilities and their carers) you may find there is some help and support available. I can guarantee they won't pay your bills though, but here may be other stuff to help you guys improve your lives.

I can't help thinking you need to seriously consider bankruptcy or an IVA, it really seems like you have nothing to lose and it will draw a big line under all this and allow you guys to pick up and start again with a little money each month to live on, not luxuries but not eating the carpet either.

I hope I have been a little help, don't take my advice by all means but do take some from someone else here and get some help, there is support out there.

Good luck

AndyBob

Thank you all for your responses. I spoke with StepChange yesterday morning for 90mins and came up with a budget and payment plan that they will take care of. Hopefully this will help.

m4rc

Good for you, that's the hard bit done I reckon, it's hard to make the first call and ask for some help.

I really hope it all goes well for you. Can I just reiterate to check you are getting all the disability and other benefits you are entitled to? It's so easy to ink you have done it all and have missed something, it's complicated and professionals often forget someone that's available. It's worth a check