At my wits end

rebbo

I feel I have no hope!

Current debt:

£6500 Tesco Credit card (£600 need for next payment)
£5000 Tesco Bank Loan (£174 monthly repayment)
£1100 Lloyds credit card (£80 monthly repayment
£1500 Very account (£80 monthly repayment)
£25000 owed to father from previous debt

Other factors to consider:

Due first baby unexpectedly later this year.
My income is only £1000 per month after deductions.
Pay about £500 in household bills monthly.
I've missed payments on all of the above accounts.
Home owner with mortgage (approximately £90k equity).
Spent 7 months of the last 18 unemployed.

I am simple a broken man through self-infliction and I now know how truly irresponsible I've been, but I simply have no other suggestions or hope

Windofchange

I guess the advice from others will be to get a statement of affairs up. I am assuming you are scuppered for 0% deals due to missing payments - your credit score will have taken a beating no doubt?

I would imagine you are facing two options:

1) Bankruptcy / Debt Management Plan
2) Sell the house to get at the equity, pay off the debt, rent / downsize and then stay the heck away from credit cards.

Can you sell any of what you have brought? Was it flat screen TV's and cars or did you gamble / booze it away?

I guess the important thing to remember is that there is always a way out. It will likely be painful but there is light at the end of the tunnel. People on here are very good at not being judgemental and I'm sure somebody will come along to assist you in a more constructive manner. There are the debt charities on here too who would definitely be worth getting in touch with.

January2015

rebbo wrote: »

I feel I have no hope!

Current debt:

£6500 Tesco Credit card (£600 need for next payment)
£5000 Tesco Bank Loan (£174 monthly repayment)
£1100 Lloyds credit card (£80 monthly repayment
£1500 Very account (£80 monthly repayment)
£25000 owed to father from previous debt

Other factors to consider:

Due first baby unexpectedly later this year.
My income is only £1000 per month after deductions.
Pay about £500 in household bills monthly.
I've missed payments on all of the above accounts.
Home owner with mortgage (approximately £90k equity).
Spent 7 months of the last 18 unemployed.

I am simple a broken man through self-infliction and I now know how truly irresponsible I've been, but I simply have no other suggestions or hope

There is always hope. Debt is just a number. It is pulling you down at the moment but it can be dealt with and dealt with in a way which lets you have a life worth living.

Huge congratulations on the forthcoming arrival of your new baby.

I would suggest you complete the debt remedy tool on Stepchange website. It will advise the best route for you to clear your debts. As you are a homeowner I suspect the answer will be a DMP.

2 years ago we were heading towards £100k in unsecured debt and were stressed, depressed and not coping. Today we still owe just under £70k but we are very happy with our lives and the enjoyment we get from clearing those debts just a bit each month is amazing.

I'm sure others will be along soon to give you great guidance and advice. Try and stay positive.

Edit: My personal opinion is not to sell the house or touch the equity in the house. This is the roof over your families head and you should protect it. We have over £250k equity in our home and I will never sell it to clear my debts. I will work to pay my debts, but not to the extent of giving up my home.

determined_new_ms

However bleak it looks right now this will all be ok, I promise you. Post up your statement of affairs and call Step Change or Paypal and talk through your options. There is a solution to all of this and at some point you'll be looking at it in the rear view mirror saying "jeez do you remember that time..."

congrats on the baby coming, such a blessing

determined_new_ms

I have to agree with January re the house. I suspect you would struggle to get another mortgage and whatever equity there is useless unless you start renting it's a moot point as it will go into a new property

fatbelly

The devil's in the detail so post it up and let's have a look at it

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

Please format for mse.

If you do stepchange's debt remedy, treat it cautiously as it's no substitute for the brain of a live adviser.

You didn't say you were behind with the mortgage so from what we've heard so far all this is non-priority debt and you should not rush into drastic 'solutions' that may make things worse rather than better.

So no consolidation with secured loans, no hasty sale of property, no bankruptcy.

And no beating yourself up. You are where you are.

smithers1981

Contact Step Change or Payplan, they will be able to help, time to be proactive, good luck.

elsien

You don't need to answer it here, but are you able to address reasons for the debt? I'm guessing unemployment isn't the reason for all of it, given the amount you owe your dad, so it is something you can now control?

ETA. I'm asking not to judge but because some people slip into debt just by overspending each month with little to show for it, others do big spend items that are more easily accounted for. Knowing the reason is a step towards sorting it all out.

enthusiasticsaver

This looks like you have been overspending for a long time and the debt from your father is from him previously helping you out?

Your difficulty is the low income. Don't sell the house. It is the roof over your familys head and your problem is lack of income and overspending. If household bills are £500 does that only include direct debits or does that cover food, entertainment etc? I think if that includes your mortgage and all direct debits that is not too bad and your problem really is overcommitted debtwise in which case you need to resign yourself to never borrowing again on credit cards or loans and get used to saving and budgeting and go on to a DMP so the cards freeze the interest and you pay it back at an affordable rate. Contact stepchange, set up a spending diary, emergency savings account (as you wont be able to rely on a credit card in future) and a bank account with no overdraft. Move salary and direct debits for essentials there. Essentials are mortgage, council tax, utilities, food, emergency savings and a DMP will allow you some discretionary spends for haircuts, entertainment, presents. Learn to budget by putting money aside each payday for annual costs, weekly cash for food etc and an emergency savings account transfer for things like boiler repair, car repair etc etc.

pennystretcher

Monthly budget is key (like already mentioned in the posts above), you can do yours here:
http://www.stoozing.com/calculator/soa.php

Also is your credit rating still good enough to get a 0% card? Try to get one and move most expensive CC debts on it, see options here http://www.moneysavingexpert.com/credit-cards/best-0-credit-cards

And no - please do not sell your house to pay off unsecured debts...