£67,031.92 is a frightening number indeed....

enthusiasticsaver

I think you are right in that secured debt seems more acceptable. I think this is purely because it is usually for an asset and not for what some may call frivolous spending or just generally overspending which unsecured debt is sometimes looked at.

Personally the ideal we went for is that unsecured debt was short term borrowing (always at 0%) for something which we did not have capital up front for but could repay over one or two years at most. Usually this was a used car, furniture/home improvements or occasionally a big holiday.

I think you have to do what is right for your family right now so personally this would be top of my priority list as feasibly a family of 5 in a 2 bed house seems like overcrowding to me. If you can do the initial stages without adding to the unsecured debt so much the better. Re the mortgage you have options presumably to extend the term in the short term to keep the payments affordable until the unsecured debt is gone.

Treadingonplaymobil

We can only extend the mortgage term back up to the full 25 years that we originally took it out at, so would only be two years longer, but I suppose that again that would improve repayments. Good to have all your thoughts on it, we're going to really thrash it out tonight (and probably for a few other nights) but we really need to make a decision on it.

Two bedrooms is definitely not doable long term, but one of the bedrooms is sufficiently big that we could divide it in two, although the resulting bedrooms would be very small, and two DC would have to share one of them. We have also discussed DH and I having a bedroom downstairs, but I just cannot figure out a sensible layout for the downstairs that wouldn't make the living spaces unworkable.

Hopefully we'll be able to come to a conclusion we're confident with, anyway.

Kantankrus_Mare

Is your attic space usable? Would that be an option for extra bedroom?

Only other thing with taking on extra mortgage is long term............if you get in the mindset.....you could overpay on the mortgage (when finances allow) and reduce the term of the mortgage.

Treadingonplaymobil

Kantankrus_Mare wrote: »

Is your attic space usable? Would that be an option for extra bedroom?

Only other thing with taking on extra mortgage is long term............if you get in the mindset.....you could overpay on the mortgage (when finances allow) and reduce the term of the mortgage.

We live in a dormer bungalow, so already living in the attic! I'd like to think we'll overpay on the mortgage, but I guess we'd better worry about getting rid of the unsecured debt first :cool:

Treadingonplaymobil

Inevitably haven't done as much today as I'd like to (gosh, what a change), but have been on the go all day. Already have 31 things on tomorrow's To Do list :eek: .

I'm really pleased with my discovery that we've paid off £3k now, although it still feels decidedly drop in the ocean relative to the overall debt. I think once we've hit 10% it will feel like real progress. Only £2,703.98 to go. :undecided

to do today
1. pull financial info together. Already done!
2. plan week's work. Done.
3. email local young archeologists club for DC1. Not done, on tomorrrow's list.
4. scan school work that came home at end of term so I can ditch the paper copies and still have a record. Done, nice to get rid of the paper bits.
5. laundry. Done.
6. ironing. Not done, but going to do some in a few mins.
7. make quiche for dinner. Done. Homemade quiche is the best, totally different to shop bought.
8. make tomorrow's dinner. Not done, although have assembled the ingredients ready to make in the morning.
9. check DS1's packing list for cub camp. Not done.
10. food shopping. Already done.
11. weed front garden. Not done, will try to bribe a child to help me tomorrow.

to do this week
1. charity shop run. Donations still cluttering up hallway.
2. take snacks and picnics for days out with the children - no unplanned cafe trips!
3. pack for camping.
4. buy walking boots. DH managed to get some in the sale today for only £65 (down from £120), so only mine to go.
5. make a decision on house extension and email architect.

Aims for July
1. Pay some extra off the MBNA card - I'd like this card gone asap. Well, a whopping £15 paid on top of the minimum payment so far, hoping to make another payment before end of month.
2. Pay for camping holiday commitments out of self employed income rather than adding to debt. So far so good, but there is one more camping trip to cover in August.
3. Stick to the budget even more closely than in June!

mfmaybe

One thing you could do is work out how much the repayments would be on your extra borrowing for the extension (using say a £60k estimate) then commit to putting that much extra aside every month, starting from right now. Untouched, not stolen back in to the budget, not paying debt. It would be a real cost if you went ahead with the plans so you need to know you can afford it, and of course it would be savings towards the project anyway. Worst case it could go against the existing debt if you decide to delay plans.

emmie26

I know this is controversial when we are on a dfw, but when we were planning the extension we had 18 months ago we were undecided if we should just do a small extension that would give us enough space for now, or get our ideal home. We are so glad we went for the latter, even in the 5 years since we started planning the extension our needs as a family have changed and we realised we would have been wanting to do more work again had we only done a small extension. A couple of things we did to help us decide was.
1. Had estate agents around to value our home as it was and with the two options of extension.
2. Had a builder around to talk about the options and estimate of costs. It was not double the cost to do double the size extension.
What I would say though was that we had no debt, £20,000 in Savings before we started and a relative who lent us £40,000, yet we still ended up with £8000 on credit cards at the end just to get it finished to a good enough standard to get a decent valuation for our remortgage.
I am really happy with our home now and hopefully will never move.
Our children were 9 and 11 when we finished it, before that they were still sharing a room and we had a tiny house.
I know this doesn't help either way, but maybe food for thought.

Treadingonplaymobil

Week 24: Day 2

First official day of the school holidays, and the first day I'm left to entertain the children on a teeny budget for six weeks. We're meeting friends at a local park with a picnic today, so it should be totally free. Start as you mean to go on!

Thanks for the thoughts on the extension. Mfmaybe that's a good idea to pick an upper-level estimate and work out how we'd manage that and attempt to live within it. Emmie26 sounds like you made the right decision. Unfortunately because of our debt level going for the full extension we want at this stage is totally out of the question, the decision is whether we go for a partial one (and how big a partial one) or none at all for perhaps 7-8 years.

I think we need to scale back our architect's ambitions from a modified dormer (complicated to explain, he thought it was a genius idea, but it would be more expensive than a plain dormer) to just a bog standard dormer at this stage, with thought given to how it might translate to a full extension at a later stage. That would keep costs to a more sensible level and enable us to hammer down the debt more quickly.

Ran out of time to discuss it with DH last night as we were both racing round getting chores done - it is so hard for us to make time for a proper conversation, because of me working evenings and weekends and him being left to do the house stuff while I do that.

to do today
1. Email local young archeologists club for DC1.
2. Laundry.
3. Ironing.
4. Make dinner for tonight.
5. check DS1's packing list for cub camp.
6. weed front garden.
7. Make picnic to take to park.
8. talk to DH about extension.
9. Balance budgets.
10. Posting for work.
11. Check mobile bill - DH thinks he bought a data bundle which has now been added on as a monthly thing rather than a one off
12. Bag up charity shop stuff.
13. Finish sorting the Lego, which is currently inhabiting the sitting room floor.

to do this week
1. charity shop run. Donations still cluttering up hallway.
2. take snacks and picnics for days out with the children - no unplanned cafe trips!
3. pack for camping.
4. buy walking boots. DH managed to get some in the sale today for only £65 (down from £120), so only mine to go.
5. make a decision on house extension and email architect.

Aims for July
1. Pay some extra off the MBNA card - I'd like this card gone asap. Well, a whopping £15 paid on top of the minimum payment so far, hoping to make another payment before end of month.
2. Pay for camping holiday commitments out of self employed income rather than adding to debt. So far so good, but there is one more camping trip to cover in August.
3. Stick to the budget even more closely than in June!

warby68

I won't deny it - your extension talk still frightens the living daylights out of me - I can see you need it but not that you can afford it any shape or form as you are in negative wealth for the time being and still working hard to stand still with a budget.

That said, you've said pretty firmly that you won't be doing anything material until after the point in time when you expect your income to take an upward jump so I can't really argue with planning ahead.

As well as simple affordability, the reason major extensions (as opposed to moving for example) scare me is that I've never ever known anyone bring one in on or under budget plus they always carry a large fitting out cost too. Not to mention the stress/strain/disruption element when you have very little room to escape in your home. I've seen people run out of money on more than a few occasions.

I'm sure you've considered this but is this really better than moving? I don't really know why you bought a house fairly recently that's so small for your family size and seems quite far from anything you do (you always mention travel costs for leisure & work).

Can you reconsider family help/confessional at all? I get what you say that you haven't a huge mortgage on its own relative to your incomes & age, but the elephant in the room unecured debt will tie your hands at some point while you remain insolvent on a net basis

I get the above are pretty intrusive questions so just food for thought rather than expecting you to respond openly in detail.

My other thought is a simpler ground floor project such as conservatory ( much as I hate them) to give more room for bedroom downstairs although am 99% sure if that were a goer you would've said so.

If its all down to plugging away until you can afford the full extension, I think I'd take the very cheapest option to just divide a room for a few more years even if not ideal. The idea of ''half'' an extension, followed by another better one will probably be fraught in terms of duplicating costs and causing endless disruption.

Treadingonplaymobil

warby68 wrote: »

I won't deny it - your extension talk still frightens the living daylights out of me - I can see you need it but not that you can afford it any shape or form as you are in negative wealth for the time being and still working hard to stand still with a budget.

That said, you've said pretty firmly that you won't be doing anything material until after the point in time when you expect your income to take an upward jump so I can't really argue with planning ahead.

As well as simple affordability, the reason major extensions (as opposed to moving for example) scare me is that I've never ever known anyone bring one in on or under budget plus they always carry a large fitting out cost too. Not to mention the stress/strain/disruption element when you have very little room to escape in your home. I've seen people run out of money on more than a few occasions.

I'm sure you've considered this but is this really better than moving? I don't really know why you bought a house fairly recently that's so small for your family size and seems quite far from anything you do (you always mention travel costs for leisure & work).

Can you reconsider family help/confessional at all? I get what you say that you haven't a huge mortgage on its own relative to your incomes & age, but the elephant in the room unecured debt will tie your hands at some point while you remain insolvent on a net basis

I get the above are pretty intrusive questions so just food for thought rather than expecting you to respond openly in detail.

My other thought is a simpler ground floor project such as conservatory ( much as I hate them) to give more room for bedroom downstairs although am 99% sure if that were a goer you would've said so.

If its all down to plugging away until you can afford the full extension, I think I'd take the very cheapest option to just divide a room for a few more years even if not ideal. The idea of ''half'' an extension, followed by another better one will probably be fraught in terms of duplicating costs and causing endless disruption.

Moving would be significantly more expensive than extending, and we'd be incredibly lucky to find a house in as good a location with a garden the size we have and with an extra bedroom - something would have to give. The reason we have such a tiny house is that we initially bought it as a starter home - very much intending to superficially do it up and then move within three years, but we just love it here, the location and space (apart from bedrooms) works so well for us. Location is perfect for us - we love the town, and I do most of my work here - I travel one day a month on the whole, and occasionally to see clients (which wouldn't change if we lived elsewhere). DH commutes, but there is no chance we would live in the city he works in, it's really not terribly nice.

Ground floor extension alone has been considered several times, but we just can't come up with a layout that works in terms of giving us a private bedroom space and continuing with a functioning layout downstairs.

The trouble with plugging away at our finances to get a big two storey extension is that it won't just be plugging away for a few more years - it would be ten years before we could afford it, and although dividing the room will give us a few more years, I really can't see it getting us through with three teenage DCs. We may never actually do a big two storey if we do the dormer, it would depend on finances, how well the space worked with a dormer and whether we felt the cost/benefit worked. So although the dormer is a bit of a halfway house (literally), it might end up being the whole job.