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Bestthingsinlifearefree · 20 November 2007 at 4:02PM

falady wrote: »

Mortgage = 818.27 (£113k borrowed at Dec 05 over 25 yrs, fixed rate 4.79% until Jan 2009, plus £21k borrowed july 07 over approx 23 years (both mortgage loans will finish at same time) at variable rate of approx 7.9%??

loan = 430 (£14k borrowed over 3 yrs (poss 3.5?) taken out in Sept / oct this yr at 6.9% (I think - will check)

quote]

Hi Ali,

Welcome to MSE :beer:

What was the £21,000 borrowed in July 2007 for?

and what was the £14,000 in Sept for?

i.e you have good income but have borrowed an extra £35,000 in 6 months.

Can you indicate where the £35,000 has gone ?

Best,

falady · 20 November 2007 at 5:13PM

Hi there,

Thank you for the welcome!

Well.....

£21k was added to the mortgage to finish work on our house - new kitchen, ensuite, carpets, decorating (the things we wanted to look professionally done / feared for our lives if we'd attempted the stairs! - we decorated the rest), boiler, internal doors, plastering.

£14k was borrowed by myself and OH as a supposed consolidation loan and to buy my car (£4200 52 reg fiesta). 'My' portion of it is £7.5k. This covers half the car, was supposed to cover my virgin card bill (but I miscalculated then carried on spending) and to pay off my overdraft. Also, to pay for my wedding dress. I know it sounds frivolous, but its done now.

OH is more sensible than me and manages his money better.

You're right, its a lot to borrow in just a few months and I would have done things differently had I realised the situation I was getting myself into. 'Ostrich syndrome' has taken over my brain in the last year or two.

However, the mortgage repayments and loan repayments are covered by mine and OH's contributions to our joint account. I think if I can just cut back spending on food (another JA expense) and sort out the JA overdraft (by spending less on food and shopping round for best deals on utilities, insurance etc), this account runs reasonably well.

It is my personal spending which has caused the problems really.

Ali xx

falady · 20 November 2007 at 5:14PM

PS - I have checked and we have an aldi near where I live. I'll check it out for veg etc on my next shopping trip. it seems to be good for the kind of things I buy based on Martin's article and table of product ratings for Aldi, Netto etc.

Bestthingsinlifearefree · 20 November 2007 at 5:52PM

falady wrote: »

Hi there,

Thank you for the welcome!

Well.....

£21k was added to the mortgage to finish work on our house - new kitchen, ensuite, carpets, decorating (the things we wanted to look professionally done / feared for our lives if we'd attempted the stairs! - we decorated the rest), boiler, internal doors, plastering.

£14k was borrowed by myself and OH as a supposed consolidation loan and to buy my car (£4200 52 reg fiesta). 'My' portion of it is £7.5k. This covers half the car, was supposed to cover my virgin card bill (but I miscalculated then carried on spending) and to pay off my overdraft. Also, to pay for my wedding dress. I know it sounds frivolous, but its done now.

OH is more sensible than me and manages his money better.

It is my personal spending which has caused the problems really.

Ali xx

Hi Ali,

I think you and OH need to realise if you are getting married that it is both your debt, both your savings, both your financial futures.

I am not sure how this "his" and mine money thing is going to work.

If you lose your job will he have to give you a loan from "his money" for food?

I think your OH manages his money equally badly as he has ageed /allowed the family i.e him and you to spend £35,000 in the last 6 months arguably on non-essential spending. Does not sound like he is managing very well at all.

I think you need a joint strategy, his money is your money, his debt is your debt your debt is his debt. Joint goals, joint plan for financial security.

Together you are earning £58,000 or so a year but felt the need to borrow an extra £35,000 in the last 6 months.

I think you need to have a serious financial heart to heart with your future husband. You are blaming yourself. Did you force your OH to put 21K on the mortgage. Was he not allowed to say no etc etc? Is he not concerned to see the family budget ie you two going more and more into debt?

If you carry on spending as you are the nice new house will end up nicely repossessed in a few years. At this stage you should be building savings not running up more debt. If your husband got made redundant tomorrow, your finances would be in big trouble very fast.

I'm not having ago. Just helping you both to have your wake up call !;)

You both need a spending diary, cut right back i.e no new sofa, no foreign holiday in 2008, maximum budget for christmas presents £20 on each other. You need to take action now to turn things around. Start reducing your debt not increasing it.

You mention you want to have children in a few years time. Now is the time to start financially preparing for it / laying the foundations while you have two salaries.

I wish you well.

Best,

P.S I have got off my soap box now. Lecture over.

P.S.S Why not e-mail him this thread ?

falady · 20 November 2007 at 10:13PM

Hi bestthingsinlifearefree,

OH and I do realise that we have joint money, joint debts etc and all household bills are paid out of our joint account. I see debt that i have run up as 'mine' because it seems very unfair for him to pay for my frivolities and silliness and personal overspending.

OH is supportive and is rightly concerned about my spending and the situation we are in. He has been more reserved about the borrowing we have undertaken than I have.

However, it is done now and our house is finished. The way we move forward is the important thing and that is what we are changing.

You're right about preparing now to have children - that is what made me wake up to the situation really. We both want to have kids, and need to be in a much better and secure financial situation before we can. That's what I'm aiming for!

Ali xx

PS soapbox was a bit scary!