Debt advice.

solventguy

lotty41 wrote: »

I have 30,000 of debt on credit cards and unsecured loans. Currently on a payment plan with all of them and interest has stopped. Single with 3 children and receiving benefits. My financial situation is so bad that it looks like I may have to sell my house and rent a place. Equity in my house is around 45,000. Renting would cost me minimum of 1000pm.

Lotty

I'm not an expert on these matters, but I had a couple of thoughts on your situation.

What I was wondering is if you couldn't re-mortgage to pay off your bills.

Before I am crucified for this suggestion, let me lay out my thinking:

1) We don't know your income yet, but I'm assuming it isn't sufficient to pay off your debts. I don't know what freezing your interest is - does that mean you aren't paying interest, or that the interest rate isn't changed? I also assume that you are charged interest - probably quite high interest - on your overdraft. So each month, I suspect, you are getting in a little deeper.

2) If you sold up, you could pay off your debts, but you'd have to find someplace else to live. So the question is, if you remortgaged, would you be paying less than the £1,000 you anticipate for renting? If so, your debt would be cleared, and you'd still have your house. (If re-mortgaging would cost more than renting, then it probably isn't the best option.) But...

3) You may be exchanging short-term unsecured debt for long-term, secured debt. Many would likely advise against this, and for good reason. The first of which is that you might not address the over-spending that got you into debt in the first place. This is critical. If you don't address how you spend more than you bring in, you'll be in the same position again quickly - but this time without a house. A second arguement is that if you default on your credit cards, you still have your house, whereas if you fail to pay off your mortgage, you won't. Again, a very important point. But if you don't pay off your credit cards, you will lose your credit rating (I assume). So, if you paid off your debt with a re-mortgage, you'd still have your house and your credit rating.

I wish you the best.

Alisonbel

I would speak to CCCS, they helped us no end and would be able to help you with a realistic budget and guide though court action etc. Good luck, keep your chin up your not alone!!

RAS

There is a way of subscribing but I have get to find it.

If desparate, go to seach this forum and type in your login name and ask it to list threads. Then every thread to which you ave contributed will show up.

Shineyhappy

If you cant get a remortgage then I would try to go on a proper dmp and then you should be able to stay in your home, which I would guess you dont want to sell.

I am sorry I dont know how to tag threads (am also pretty useless with any form of modern technology).

I would look into making some extra cash online to help sort out your overdraft. There are things like online surveys, cash back sites, selling on Ebay/Amazon etc and some people make quite a lot doing this.

Have a look at the Old Style board on tips to reduce food shopping and the Freebie thread for nice little free treats (this also has good threads on Pigsback and Quidco- make sure you read the first few posts of each). I have 22.50 saved towards Xmas in my piggy bank and I have spent nothing!

Dr_Hook

To subscribe to the thread click on Thread Tools just above your first post and click Subscribe to this thread.

To find the thread again tomorrow, click on Quick Links (again at the top of the screen - right-hand side) and Subscribed Threads

I really think you should get your income & expenditure together and speak to CCCS/Payplan. It sounds like you want to keep back some of the equity from the sale of your house to 'live on', but that won't last forever and you'll be back in debt unless you can balance your I&E.

chevalier

Are you now getting the interest paid on your mortgage if you are on benefits?

Here are some survey sites, which will increase your income a little. Hope they help.

Also at the bottom there is some other suggestions ref reclaiming bank charges, and checking you are in the correct band for council tax
Good luck
chev


www.lightspeedpanel.com - this is a survey site, where you get points which turn into vouchers (you choose). May not help with the cash flow, but the vouchers could be saved towards birthday/xmas or given as presents.

www.ciao.co.uk - survey site that gives money. A bit fits and starts ie no surveys for a couple of weeks, then three or four the same day.

www.yougov.com - again paid surveys. However takes a while to get to the minimum payout level

www.mytns.com - again this is a survey site, but it pays you in points that convert into Nectar points at Sainsbury’s.

www.pigsback.co.uk - this is a points site, ie they give you points for buying things via their site. BUT you also get points for signing up for news letters (some of which are even interesting!), and also for clicking on adverts with pink borders. I have spent NOTHING with them but got a £10 voucher through this week (only been registered since January). There is also a thread in the freebies section, of https://www.moneysavingexpert.com which gives you all the daily answers to the competitions so you can have a better chance of winning on them.

www.mutualpoints.com - another points for clicks site. You can also buy things via their site and get points too. For a long time, I just clicked the links in the emails they send you, and that gets you 5 points. At 3000 points you get £20 I think. You can do searches via their site and that gets you points too.

www.quidco.com - this is a cash back site, so very good, for checking if any potential new insurers (ie if you have checked your contents insurance say and found a new provider), are offering cash back. Eg Lloyds was offering £120 cashback on new policies at one point (the offers do change). You can also get small amounts of cash again for doing searches via their site. You can earn 52p a day by doing this. Every little helps.

www.greasypalm.co.uk - another cash back site, where you can do searches and get small amounts of money. But it all adds up. I think you can get about 50p a day on there for nothing. Minimum payout is £20 I think, but you can sign up to survey sites via there, and get extra money that way for nothing.

Again more medium term money might come from claiming back bank charges. Also if you had an endowment you can write to your provider suggesting you might have been misinformed about its performance. Many people have got money back on that. There are articles from Martin on the main site about how to go about doing this.
If you are going to do this, it is wise to set up another current account first, with a bank that you have no debt with. Just to be on the safe side.

Are you in the correct banding for your council tax? Again there is an article by Martin on the main website about how to go about checking this. If you are in the wrong band and due a rebate, it is for all the year you have been living in the house since 1991, so this can be several thousand pounds back.