The biggest mess

Baddebt

Hi,
I’m not sure if this is being posted in the correct place. I will try and make this brief as this is such a complicated situation I have got my self into 😢

Basically in 2012 I started selling on eBay and amazon to earn extra money and each year it became harder and harder which has made my debts spiral. I spoke to stepchange a year ago but they said bankruptcy could be an option but as my mother in law and father in law got a personal loan out in each of there names I couldn’t be seen to prioritise my debts in making sure I paid there loans so they don’t get a bad credit rating.

I would also like to mention that I have a poor credit score on noddle but this isn’t due to missed payments or ccj it’s because I’m not a home owner and owe a ridiculous amount of money.

My personal debt
£8500 credit card. £130 interest per month
£4000 credit card. £100 paid per month £60 interest charged
£3700 credit card. £130 per month £80 interest charged
£650 overdraft. £30 interest a month
£350 overdraft. £30 interest a month
£150 overdraft. £10 interest a month
£950 flexi loan. £45 per month
£19700 credit union loan. £116 per week but £33 interest charged per week

Wife’s debt
£10000 credit card. 0% pay £230 per month
£400 credit card £40 per month
£600 overdraft

Father in law
£6000 personal loan over 5 years £28 per week 234 weeks left

Mother in law
£19360 at £220 per month 88 months left

We roughly earn £2900 a month take home and from online sales roughly £1000 per month. The problem is we can’t anything on 0% as we are maxed and we are council tenants so don’t own a home, we are mid 30’s and still dream of owning a home one day but if we can’t sort this mess it will never be possible.

Singlespeeder

A quick tally ... roughly £75,000.
Others will advise..

WhenIam64

from online sales roughly £1000 per month

Do you pay any income tax and VAT on the online sales?

Baddebt

I’m not vat registered only as a sole trader, I’m currently sorting out a new accountant as this is another part of the mess. I haven’t declared last years sales as I originally was going to stop trading online but if I do that I can’t pay the bills.

sourcrates

Hi,


First question you must ask yourself is how did i manage to accrue 75k of debt, where did it all go ?


Whatever bad financial decisions you have made in the past, you must draw a line under them, work out a livable budget, and stick to it, if you fail to do this, then no matter how you choose to tackle these debts, you are not going to learn the lessons that got you into debt in the first place.


Personally, with that amount of debt, and your desire for a home of your own, bankrupcy would be an option to look at, six years time, all will be forgiven, and the dream of a home of your own can still be achived, i suspect any other plan, would take a long time to clear it all, and could extend the time negative info is on your credit file.


Obviously more detail is required before set in stone advice can be given, a statement of affairs is usually the starting point.

comeandgo

Being a sole trader has nothing to do with not being VAT registered. You must register when your turnover, not profit, hit 85,000 for the previous 12 months. To have profit of £1,000 per month, your sales would be in the region of 9,000 to 10,000?

Baddebt

The debt amounted from a failed retail business and trying to make a successful online business. It was never from
Just spending on credit cards for luxury purchases I just made the mistake of debt consolidation twice and falling into the same trap again.

If I went bankrupt it would only wipe my debts off and leave my wife’s, mother and father in laws which still leaves £30k plus this is why I’m just trying to middle through it.

My dream is that if I can maintain the payments and sort the tax situation so I don’t have the stress of worrying about hmrc as well then I a few years it should have reduced a fair amount which would improve my credit score and make me feel less depressed and human again.

Karonher

You don't say what hours you and your wife work, but could either of you take on extra work?

Even a few hours extra at the weekend could let you pay the overdrafts off and use that money to get rid of something else.

Could the in-laws help in anyway? Maybe pay the loans in their name for a year as an example and you pay them back once the rest of the debt is under control. It will extend the time you pay them but would give you time to work out a long term plan.

Baddebt

I work full time mon-Friday but it is possible for me to earn some extra money on a Saturdays which I am going to look at doing I just have to juggle it around my two kids.
I haven’t explained to any family or friends the mess we are in as it just feels really embarrassing to me. My wife is currently Inbetween jobs but hopefully she will look at working some more hours to help clear this mess.

Candyapple

So is your total monthly income £3,900? If so and your wife is looking for work, even if she brought in bare minimum of £1k, you’d have a monthly income of just under £5k which should help you make inroads.

Your next step should be to fill out a statement of affairs to see how things are realistically and if it can work or explore your options.

HampshireH

My wife is currently Inbetween jobs but [Bhopefully[/B] she will look at working some more hours to help clear this mess.

Is your wife aware of the full extent of the debt and family finances and onboard with changing habits/behaviours to sort it out?

I highlighted the hopefully because it sounded a bit non comittal. She needs to get any job for now to bring in an additional income to help you carry the burden. There are jobs out there even if they may not be the one she wants long term.