Debt assistance

System

Double check the rules on transferring your parents mortgage to yourself. I believe they have to stay and pay rent for seven years for you to avoid tax issues.

Karonher

I don't have much to add other than the fact that you have put road tax in twice at slightly different amounts so should have £20 plus extra.

When does your phone contract end and do your parents watch the satellite programmes or could that go?

Can you cut the eating out and entertainment bill? £250 is a lot when you want to make savings. Cut that back to about £70 a month. Drop the gym. You put £25 savings but that does not show anywhere.

£400 is a lot for petrol - is there anyway that some journeys could be on public transport and therefore possibly cheaper if you got a weekly/monthly pass?

There could be over £200 savings made without knowing if you can cut back on petrol/phone/satellite.

onthefencepost

Hi all,

Thank you for you the kind words and advice to clear a few things up

Yes £600 or so is my fuel / Entertainment costs so effectively they almost cancel each other out as I pay this off monthly.

Road tax is for my parents car - yes I should have put this under one. Unfortunately dropping to one car isn’t a option.

I’ve already cut my entertainment / eating out down somewhat but it’s not been easy! In regards to the gym I’d be looking to keep this as I’m on a weight loss programme and keep me sane going to the gym and healthy.

In regards to fuel 75-80 % of the mileage is for work - I do have a long commute. However I’ve started cutting back on using my car for social purposes.

I’ve reduced my sky package / broadband and telephone down from £74 to £49.50. I’ve still got over a year left on my contract - shame as I was sim free for several years but my old phone was totally goosed so opted for a new phone!

You make a valid point not to turn my unsecured debts into a secured debt. However what are the alternative options given the small amount of mortgage remaining? It’s an opportunity long term to get on the property ladder. I know slots against me but having some options to choose from would help.

I’ve rang a debt charity earlier in the week, but with the mortgage looming they’ve asked me to seek some advice. I’ve also spoken to a mortgage broker who could in principle get me a mortgage as there is equity in the house.

Just to touch on gambling I’ve not gambled since finishing my therapy lessons back in December. I’m very proud of this - I feel reborn and new person, it’s not easy but given the financial mess I’m in I still have half a lifeline which I’m not willing to loose.

Big advantages of a DMP is a potential interest freeze, pay of debts and actual have some money left over. Downside is that if I/ parents loose our roof I won’t be able to get a mortgage and struggle to rent for many years.

A slight twist my parents mortgage provides are going to write to my parents in the coming week with options I’ll post more information up as I get this.

Vikipollard

onthefencepost wrote: »

Hi there,

This has been a painful but necessary task to complete.
Just highlights the sheer scale of a mess im in!

The taking over of the mortgage complication just makes it worse! Am im not going to get accepted with these debts? I was thinking of rolling these debts into the new mortgage?

I've missed no payments. I do have one old credit card default which will be coming off in 2021. My outgoings are higher than my income and as much as I can occasionally break even in the month I end up the following month going into further debt by drawing money on my credit cards at eye watering interest rates just to pay bills etc. Also its unexpected car repairs or monies for gifts which don't help. I work very hard for my wages and each month my situation is getting worse.

I genuinely am grateful for help and assistance in this matter.

Thank you!


Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Monthly income after tax................ 2350 (averaged over the last three months – expenses included without 2079)
Partners monthly income after tax... 0
Benefits........................................... 0
Other income................................... 0
Total monthly income.................... 2350

Monthly Expense Details
Mortgage...................................... 0
Secured/HP loan repayments....... 0
Rent............................................. 400
Council tax................................... part of rent
Electricity...................................... part of rent
Gas.............................................. part of rent
Oil............................................... 0
Water rates.................................. part of rent
Telephone (land line)................... 0
Mobile phone............................... 61
TV Licence.................................. part of rent
Satellite/Cable TV........................ 70
Internet Services......................... part of tv services
Groceries etc. ............................ 150
Clothing....................................... 30
Petrol/diesel................................ 400
Road tax..................................... 23.75
Road tax......................................25.37
Car Insurance............................. 35
Car maintenance (including MOT)......... 40
Car parking.................................... 0
Other travel.................................... 0
Childcare/nursery........................... 0
Other child related expenses.......... 0
Medical (prescriptions, dentist etc).. 0
Pet insurance/vet bills..................... 0
Buildings insurance........................ 0
Contents insurance........................ 0
Life assurance ............................... 31
Other insurance.............................. 0
Entertainment................................ 100
Eating Out......................................150
Holiday............................................ 0
Emergency fund............................. 0
Student Loan Repayment (DD)...... 0
Nest Pension..................................10
Lifetime ISA....................................20
Savings...........................................25
Gym................................................23


Total monthly expenses.................. 1594.75


Assets
Cash................................................ 0
House value (Gross)....................... 0
Shares and bonds........................... 0
Car(s).............................................. 2500
Other assets................................... 0
Total Assets.................................... 2500




Secured & HP Debts
Description....................Debt......Monthly.. .APR

Total secured & HP debts......0

Unsecured Debts
Description....................Debt......Monthly.. .APR
Nationwide Over Draft Ac 1 2000 22 Unsure of APR
Nationwide Over Draft Ac 1 1000 15 Unsure of APR
Amex Charge Card...............600.......600.......N/A ( I pay this off monthly includes fuel and little entertainment and food shopping)
Aqua CC............................3600......190.......42.9
Tesco Bank CC..................1200......40........29.9
Marbles CC........................4600......189.......34.9
Amazon CC........................4000......125.......27.0
Creation CC........................4000......40.......0% – Till Jan 20
Asda CC.............................3100......35........0% – Till MAR 20
Credit Union Load .............5100......275.......11
Shawbrook Loan 1.............3900......175.......15.9
Shawbrook Loan 2.............4300......175.......15.9
Restons (tomlin order) Unsure 10
Total unsecured debts.........37400.....1291....


Monthly Budget Summary
Total monthly income.................... ..............2350
Expenses (including HP & secured debts). 1594.12
Available for debt repayments..................... 755.88
Monthly Unsecured debt repayments......... 1291
Amount left after debt repayments.............. -535.12

Personal Balance Sheet Summary
Total assets (things you own)........... 2500
Total HP & Secured debt................... 0
Total Unsecured debt........................ 0
Net Assets......................................... 2500

If the Amex costs (+/- 600) are the sum of Petrol (400) plus entertainment (150) and some food (50) then you are DOUBLE COUNTING. If you really do clear it every month, then please take it off your figures as you *should* be +65, not -535.

Suseka97

onthefencepost wrote: »

......... You make a valid point not to turn my unsecured debts into a secured debt. However what are the alternative options given the small amount of mortgage remaining? It’s an opportunity long term to get on the property ladder. I know slots against me but having some options to choose from would help.

I’ve rang a debt charity earlier in the week, but with the mortgage looming they’ve asked me to seek some advice. I’ve also spoken to a mortgage broker who could in principle get me a mortgage as there is equity in the house.

Big advantages of a DMP is a potential interest freeze, pay of debts and actual have some money left over. Downside is that if I/ parents loose our roof I won’t be able to get a mortgage and struggle to rent for many years.

A slight twist my parents mortgage provides are going to write to my parents in the coming week with options I’ll post more information up as I get this.

You've kind of said it yourself... the big advantage with a DMP is the potential interest freeze and as to the longer term plan to get on the property ladder, well depending on what happens with your parents mortgage review - you could look to transfer ownership further down the line when you are debt-free.

shteca

tlc678910 wrote: »

This will probably sound brutal, and I don't mean it to be, but because you have a problem with gambling you should not take ownership of your parents house - this could lead to the worst of the worst outcome for them. It isn't fair to expose them to this risk particularly if they don't know you have a problem. Losing your parents house would also probably destroy your own mental wellbeing too.
Get your parents to meet with a broker. There can be options for borrowing into retirement if they have an income or they may have to consider a lifetime mortgage /downsizing or even renting.
Good luck
Tlc

Unfortunately I agree. You are worried about it now and you don't have a mortgage. These things will become a WHOLE lot worse with that added stress. You want to take care of them which is amazing and you truly love them.
The best thing you can do for them now is clear this debt and sort out the gambling. This needs to put the fire under your feet.
Do not go looking for more debt now, you dont need any more.

fatbelly

onthefencepost wrote: »

A slight twist my parents mortgage provides are going to write to my parents in the coming week with options I’ll post more information up as I get this.

That's the key point to the plans and options that the three of you have going forward!

onthefencepost

Vikipollard wrote: »

If the Amex costs (+/- 600) are the sum of Petrol (400) plus entertainment (150) and some food (50) then you are DOUBLE COUNTING. If you really do clear it every month, then please take it off your figures as you *should* be +65, not -535.

I have no choice to clear it off every month as its a charge card. I'll adjust the figures.
Also I need to have a system I have which records what I actually spend against my allocated budget as I am short most months.

onthefencepost

fatbelly wrote: »

That's the key point to the plans and options that the three of you have going forward!

I agree, if they can offer some options for the next few years to keep things as they are i.e in my parents name so I can get my debt under control.

However if I go down the DMP route this will remain as a marker on my file for the next 6 years or so? But equally chopping my debt down will be impossible at my current income as most is interest on the credit cards i'm paying off. Also my monthly payments end up increase as im having to take out more cash advances to make ends meet.

I've slept on some of the comments and think that a DMP will be the best solution.
I can free up alot of cash and will allow me to save alot more money. Cash is king ultimately.

onthefencepost

Hi,

What are the next steps for me to set up a DMP?

Can I keep my Amex card during a dmp? It needs to be paid of monthly as it’s a charge card and can count towards some good credit reporting? I’ve recently renewed it and have around 52000 membership points

Do I need a new bank account? Also my Tesco credit card has the smallest credit limit of £1250 if I can pay this off over the coming months I’d like to keep this as a emergency card.
I’m just planning safety net - don’t want to be left venerable.

Thank you.