Help please too much debt

FREDTHERED82

Hi,

Some advice please if I may.

I've managed to rack up unsecured debts of approx 32k, (5 creditors, 30k in loans & 1.8k on 2 credit cards).

Long story short I've been robbing Peter to pay Paul for too long and the debt seems to be growing. Currently all of my accounts are up to date, no outstanding payments or arrears.

Having seen so many positive stories in this forum the time feels right to contact StepChange to formalise some kind of repayment plan.

My circumstances are as follows, I am a homeowner (joint), all of the debt is in my name, partner is aware and is very supportive albeit she agrees some of my decisions have been reckless. We have approx 50k worth of equity in our property but would have a registered preference to safeguard our house and ensure its not included in any proposals as we have 4 dependents to consider.

I am in full time employment and have approx £400-£450 surplus in my budget that I can offer to creditors.

I am interested to understand whether my partners income needs to be factored in when I use the debt remedy tool as the debt is only in my name? Some of the debt (not all) has been accumulated via gambling to add to my woes but I am currently addressing this via account closures and self exclusion measures.

Any help / advice would be greatly appreciated.

Afreshstart

Hi FREDTHERED82
Your situation is not to disimilar to mine.
(Nearly £70K in debt due to gambling,joint home owner).
1. I was advised to consider an IVA to protect the house - I chose a DMP,my choice.
2.I was advised my wifes income/expenditure etc needed to be taken into account - i disagreed
IVA - Be carefull and make sure you 100% know what you are entering into,I'm not advising you one way or another.
DMP - Informal arrangements which you can take control of within reason but doesn't 100% stop a creditor seeking a CCJ/Restriction on sale - there's a difference when joint ownership.


If it helps I have been self managing a DMP for nearly 2 years and this forum was a life saver.
Lots of advice and experiences if you read back.
Best desicion I made.For me all the mainstream lenders and DCA have been fine to deal with.
Best advise I can give is don't rush into anything.
If you want to take the view it's all your debt and no joint accounts,so no associattions (financial) with your partner then treat it as yours and yours alone.Others may disagree I'm only saying how I approached this - My debts,my problem.
Hope this helps a little.

Assuming you do a DMP.
I've just reread your post and given you have dependents it may be wise to include partner,benifits etc.However just make sure you allow for everything you need when compiling an I&E form.If you're comfortable with £400 a month, make sure the figures show that, there's a certain amount of flexibility here.You will have no credit once you go down this route.Also as always advised give yourself 3-6 months to put something away for emergencies.You don't have to explain the reason for your situation,I did but it probably made no difference,I just felt I owed an explination at the time.

sourcrates

Post moved to general DFW forum for further advice on options.

FREDTHERED82

Thank you for taking the time to respond.

Given my circumstances how likely is it that a CCJ / restriction of sale / attachment of earnings could occur?

These are scenarios that I desperately hope I can avoid tbh.

Keen to emphasise also that the ownership of the debt remains with me but understand being a joint homeowner complicates things.

Anxious times ahead.

Louoffofsparkle

Whats the apr on all of your debts?
Do you actually have £400 left at the end of the month or is that what you think you should have?
Doing an accurate SOA is scary but worthwhile, might be able to save more money than you think.

You say that you are making all your payments at the moment so I’m not sure why you’re thinking about a dmp?
Concentrate of getting rid of your cards first, then see if you can repay the loans early.

It’s hard but actually sitting and budgeting once or twice a month makes you feel in control of the situation.

getmore4less

Start with a SOA you need it anyway so might as well get on with it now.

http://www.stoozing.com/calculator/soa.php

once you have the full picture of the numbers is will become a lot clearer what options there are

Initially do a full family SOA with both incomes and all spending.

The first step will be to stabilize the situation so that everything is covered and not growing.
once the needs of the family are covered it will be clearer what is left to tackle the debt.

imprtant that the amounts min payments and interest rates there with any 0/low rate ho long they have.

It can take time to gather all the info, do what you can then post the SOA this will help identify what else is needed and people can start having a look at what can be done.

FREDTHERED82

Statement of Affairs and Personal Balance Sheet

Household Information[/b]
Number of adults in household........... 2
Number of children in household......... 3
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 1200
Partners monthly income after tax....... 650
Benefits................................ 475.75
Other income............................ 0
Total monthly income.................... 2325.75

Monthly Expense Details
Mortgage................................ 512
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 106
Electricity............................. 40
Gas..................................... 30
Oil..................................... 0
Water rates............................. 36
Telephone (land line)................... 0
Mobile phone............................ 93
TV Licence.............................. 13
Satellite/Cable TV...................... 30
Internet Services....................... 35
Groceries etc. ......................... 400
Clothing................................ 40
Petrol/diesel........................... 120
Road tax................................ 10
Car Insurance........................... 36
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 60
Medical (prescriptions, dentist etc).... 35
Pet insurance/vet bills................. 0
Buildings insurance..................... 5
Contents insurance...................... 5
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 20
Haircuts................................ 50
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 30
Total monthly expenses.................. 1706


Assets
Cash.................................... 0
House value (Gross)..................... 145000
Shares and bonds........................ 0
Car(s).................................. 1
Other assets............................ 0
Total Assets............................ 145001


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 85000....(512)......2
Total secured & HP debts...... 85000.....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
HITACHI........................8000......150.......10.9
HITACHI........................658.......14........0
HITACHI........................4444......114.......13.9
VERY...........................1930......100.......0
MBNA...........................428.26....100.......18.9
HALIFAX........................13500.....311.......18.9
HALIFAX........................844.......25........18
HITACHI........................5789......103.......9.2
Total unsecured debts..........35593.26..917.......-


Monthly Budget Summary
Total monthly income.................... 2,325.75
Expenses (including HP & secured debts). 1,706
Available for debt repayments........... 619.75
Monthly UNsecured debt repayments....... 917
Amount short for making debt repayments. -297.25

Personal Balance Sheet Summary
Total assets (things you own)........... 145,001
Total HP & Secured debt................. -85,000
Total Unsecured debt.................... -35,593.26
Net Assets.............................. 24,407.74

Created using the SOA calculator

ndf9876

Just a very brief glance over the above...you never service or MOT your car? That doesn't seem right....also, do you work from home as I see no commuting costs in there.

Emergency fund - I'm not sure of the logic of having one of these when you're mired in debt - others may have different thoughts.

Mobile bill - this looks a little on the high side to me, although I guess this is for you both. Any chance of going SIM-only?

Entertainment - I see you put 0 in here. Do you really sit and stare at the walls all day, every day, especially with 3 kids in the school holidays? I'd do my nut in if that were the case!!

Groceries - I reckon you could get this down even with a family of 5 - I've managed to feed my family (3) on £40 a week pretty easily, so even doubling this lands you in the £300 mark.

FREDTHERED82

Thanks for your comments.

The mobile phone costs cover 3 handsets.

Commuting costs are covered in the £120 costs for diesel.

The budget for MOT / Servicing is an oversight on my part.

Are u suggesting a DMP may not be the best option?

ndf9876

FREDTHERED82 wrote: »

Thanks for your comments.

The mobile phone costs cover 3 handsets.

Commuting costs are covered in the £120 costs for diesel.

The budget for MOT / Servicing is an oversight on my part.

Are u suggesting a DMP may not be the best option?

Ah OK fair enough - I find SOAs hard work to put together, because there's often a lot to remember \ a lot we take for granted.

I wouldn't like to give you opinion or suggestion on whether DMP or IVA is a better road to go down - simply because when I was in this kind of position many years ago, I had no property and no family.

Sea_Shell

Did you buy anything that you can now sell??

How much is your car worth (you put £1)? Assuming it's more than that, can you 'downsize' it, financially?