Over 30K in unsecured debt SOA

dfw2019

Hi,

My SOA is below. I am a recovering gambling addict which is how I got myself into this mess. I am 29 years old. I am fortunate enough to have a great job so am hoping I can dig myself out of this without having to resort to anything too drastic.

Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Monthly income after tax................ 5544
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 5544

Monthly Expense Details
Mortgage................................ 485
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 190
Council tax............................. 169
Electricity............................. 25
Gas..................................... 22
Oil..................................... 0
Water rates............................. 22.5
Telephone (land line)................... 0
Mobile phone............................ 16
TV Licence.............................. 12.85
Satellite/Cable TV...................... 30.99
Internet Services....................... 0
Groceries etc. ......................... 220
Clothing................................ 30
Petrol/diesel........................... 0
Road tax................................ 0
Car Insurance........................... 0
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 240 (these are my weekly counselling sessions for the gambling addiction, I'm told I might be ready to stop them in a couple of weeks)
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 65
Haircuts................................ 20
Entertainment........................... 100
Holiday................................. 120
Emergency fund.......................... 0
Student Loan Repayment (DD)............. 607 (approx 1 year of repayments left)


Total monthly expenses.................. 2425.34


Assets
Cash.................................... 0
House value (Gross)..................... 490000
Shares and bonds........................ 0
Car(s).................................. 0
Other assets............................ 0
Total Assets............................ 490000


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 264830...(485)......2.2
Total secured & HP debts...... 264830....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Halifax CC.....................11500.....365.......29.7
Barclaycard CC.................5000......133.......18.8
Tesco Bank CC..................200.......25........39.94
Halifax Overdraft 1............1800......0.........0
118 Money Loan.................3480......382.......103.5
Santander Loan.................4500......205.......23.9
Zopa Loan......................1350......449.......8.5
Halifax Loan ..................4700......350.......19.5
Capital One CC.................200.......7.5.......30.3
Total unsecured debts..........32730.....1916.5....-


Monthly Budget Summary
Total monthly income.................... 5,544
Expenses (including HP & secured debts). 2,425.34
Available for debt repayments........... 3,118.66
Monthly UNsecured debt repayments....... 1,916.5
Amount left after debt repayments....... 1,202.16

Personal Balance Sheet Summary
Total assets (things you own)........... 490,000
Total HP & Secured debt................. -264,830
Total Unsecured debt.................... -32,730
Net Assets.............................. 192,440


I have had the gambling problem for the last couple of years and stopped two months ago. At this point I had a large amount of payday loan debt too. I have made the last 2 months of payday loan repayments using funds from the 118 loan that I took out recently but I have one last set of repayments at the end of this month for the amount of £2180. I am not sure how I will pay them as I will be around £1000 short.

My credit report is pretty terrible. I have never missed a payment but the high amount of debt means I am 99% sure I won't be able to do consolidation/balance transfer. I considered a secured loan but I am not sure this is wise.

Once I get past the end of this month somehow, the plan is to start paying off the highest APRs first. The 118 loan is ridiculous so that will be the first to go.

I expect a bonus in December of around 15-20K (after tax). I will need to put a large chunk (maybe 5K) of this aside for an expected tax bill (I need to pay back the tax free allowance which I am not entitled to at my salary) but the rest can go on debt repayment.

Things I have done in the last couple of months:
- switched to interest only mortgage which more than halved my payments. It's fixed for one year then I plan to switch back if the debt is more under control by then.
- switched my student loan repayments to direct debit. This means that when I get my bonus in December they won't take a chunk of it from my wages and I can pay off higher interest debt instead.
- sold what I can on ebay
- started eating free breakfast at work and skipping lunch where possible
- paused my pension contributions

Any advice is welcome. I realise that getting into debt from gambling was incredibly stupid so if we could please not dwell on that!

Grumpelstiltskin

Do you live alone? If so why is your council tax so high?


Entertainment and holiday has to go immediately, you can't afford them at the moment.

dfw2019

Yes I live alone and have single person discount. I've heard that I might be able to get it spread over 12 months instead of 10 so I'll look into that.

I can try to cut down on entertainment. Unfortunately I have two close relatives getting married overseas this year and so I can't really cut down on holidays.

Grumpelstiltskin

dfw2019 wrote: »

Yes I live alone and have single person discount. I've heard that I might be able to get it spread over 12 months instead of 10 so I'll look into that.

I can try to cut down on entertainment. Unfortunately I have two close relatives getting married overseas this year and so I can't really cut down on holidays.

There will be hard choices and it's up to you whether you go to the weddings or concentrate on paying your debts.

Also your food bill is very high if you are getting free food at work.


Do you cook from scratch or buy ready meals?

dfw2019

I'm best man for both of them so can't really back out.

I probably spend about £35 a week on food and then another £10 on toiletries, washing tablets etc. I mainly cook from scratch but I can try to cut the cost down even more, I didn't realise that it was a lot.

D_M_E

Your mortgage provider will not be happy you have no buildings insurance - this is a must get.

Also there should be something for an emergency fund - something here may have paid for the overseas celebrations but something to consider for the future.

Once the sessions stop, will the payments for them also stop?

Presents, haircut, holidays can all be cut and savings put towards debt - as you say, the 118118 should be the first tackled, pay all cards the minimum plus an extra 20% if possible and put everything left over at the 118118 until that's gone then work on the next highest and so on.

Don't forget to reinstate your repayment mortgage when the interest only period is done and consider overpaying when the debt is gone.

Good luck on your journey and remember times may be difficult now but now that you have recognised and are dealing with your gambling addiction then you future can only be bright.

dfw2019

D_M_E wrote: »

Your mortgage provider will not be happy you have no buildings insurance - this is a must get.

Also there should be something for an emergency fund - something here may have paid for the overseas celebrations but something to consider for the future.

Once the sessions stop, will the payments for them also stop?

Presents, haircut, holidays can all be cut and savings put towards debt - as you say, the 118118 should be the first tackled, pay all cards the minimum plus an extra 20% if possible and put everything left over at the 118118 until that's gone then work on the next highest and so on.

Don't forget to reinstate your repayment mortgage when the interest only period is done and consider overpaying when the debt is gone.

Good luck on your journey and remember times may be difficult now but now that you have recognised and are dealing with your gambling addiction then you future can only be bright.

Buildings insurance is included in my leasehold payment I believe. Yes the £60 a week for counselling should stop in the next couple of weeks which will help.

Thanks for all your advice

Grumpelstiltskin

Go over to the old style board on here for ideas,

Shop at Aldi, Lidl, Home Bargains, B & M Bargains etc, and don't be taken in by expensive brands especially on household goods and toiletries.

D_M_E

You need to urgently check what the management charges are for and if they do actually include buildings insurance - leasehold flat/apartment then probably but leasehold house most likely not.

dfw2019

D_M_E wrote: »

You need to urgently check what the management charges are for and if they do actually include buildings insurance - leasehold flat/apartment then probably but leasehold house most likely not.

It's a flat and I have confirmed that it's included.

theoretica

In the short term you need to get out of the Payday loans - for a couple of months until this is gone you need to cut things like entertainment, presents, holiday savings, any toiletries you are not in desperate need of. You may need to ask for the PDL to roll over a few hundred a month longer. Once that is gone you can then catch up the holiday savings you didn't make for these two months and concentrate on overpaying the 118.


You have a fairly tough year ahead of you, but with the student loan coming to the end, your salary and your anticipated bonus you should be able to be out of this in a year.



The counselling is much cheaper than slipping back to gambling would be.