Please help:(

fatbelly

Sarah_x wrote: »

Hi thank you for replies
The thought of paying debts for 11 years:(
My husband seems to fink if we stop paying our morgage payments and debts
Then move into is parents and get a council house then file for bankcruptcy and start a fresh.
Would this work or is he being stupid:(

No it's not stupid but may not be that simple. How realistic is it for you all to move into his parents' house? What makes him think he will be able to get council accommodation, having made you all intentionally homeless?

Private sector rents are very insecure. Is it not worth sticking with your own house given that you can fairly easily afford the relatively (compared to private sector rents) cheap mortgage?

fatbelly

MovingForwards wrote: »

Looking at your SOA:

Mobile phone............................ 75 - how long til the contracts are up? SIM only for two of you will be £20pm

Internet Services....................... 40 -- can you drop your speed to get a lower bill?

Groceries etc. ......................... 550 -- where do you shop? You could easily get this down.

Clothing................................ 50 - dont buy anything for your / husband, only as required for the kids. Where do you normally buy clothes?

Petrol/diesel........................... 160 - is this commuting to work? Is public transport cheaper?

Car Insurance........................... 75 -- shop around on renewal, I'm assuming young / new drivers?

Childcare/nursery....................... 20 -- what's this for if your husband is a stay at home dad?

Other child related expenses............ 60 -- again, what does this cover?

Medical (prescriptions, dentist etc).... 20 - whose? If just one of you then look at prepayment certificate. Or see if you can buy them over the counter, or if prescription ask your GP to write out a prescription for more as you can't afford the monthly prescription fee (I've done that before and the GP understood)

Pet insurance/vet bills................. 15 - what animal? Who is the insurer? How much you covered for?

Buildings insurance..................... 15 -- I hope this is buildings and contents?

Life assurance ......................... 10 - this for both of you? Does it cover the full mortgage and some or is it a decreasing policy?

Presents (birthday, christmas etc)...... 50 -- this is £600 a year, cut back, love is free and adults can go without, bake biscuits / cake if you want to give adults a gift.

Haircuts................................ 20 -- for the kids and adults? If adults too then leave a longer time between getting your hair done.

Entertainment........................... 50 -- what do you do?

Holiday................................. 50 -- is this booked and a deposit paid?

In addition:
Council tax............................. 116 - is this spread this over 12 months?

Electricity............................. 120 - use mse energy club to get the best deal.

Water rates............................. 57 - check your water authority website for any schemes available to you

AnotherJoe

Sarah_x wrote: »

Thank you x
we are trying to sell just not selling at all.
The dmp option is just a bit too long
This house is in-need off new windows n door bad.
Thought of waiting 8 plus years
No 1 prepared us for this situation
I never ever thought we wud be in this position.

Its only 8 years if husband never gets another job and if you never earn more money.
As for selling, it wont clear your debt, private rent would be more than your mortgage and council houses dont fall off trees as your husband seems to think.
Even if husband worked from home that would start to make inroads.


re spending, your mobile phone bill is ridiculous. Me and MrsAJ are on £5 a month SIM only deals.

Same goes for food, much higher than the average.

Clouds88

You are not thinking long term...

If you went BR you’ll lose your house, you’ll pay any disposable income to an IPA for 3 years which, if living at our partners parents will be high as you’ve got £300 disposable income already, they don’t allow a budget for holidays too and other areas could be scrutinised depending on which OR you get. For example when I went BR my grocery budget was cut to £400.

Okay so now we move onto the long term; IF you paid your debts back and it took 8 years that means in 8 years you’ll be debt free, and each year you’ve actually gained money in paying off your mortgage. After 20 or whatever years you’ll never have to pay a mortgage/rent again and actually have an asset. If you go down the clear it all now route for a council house/private rented place then you’ll find it so hard to get back on the property ladder.

Also, why would you qualify for a council house if you could private rent? I don’t get how people qualify for council housing like I get you will be higher priority with having a disabled child but I don’t think, if you could afford private rent, you would be anywhere near the top I think it’s people who are genuinely homeless or whos income is solely benefits, say 1K a month and wouldn’t be able to pay rent. (My husband has worked in the council house sector before)

Goodluck on your journey. I think you need to not make any fast decisions and talk to one of the free debt charities. An IVA could be an idea?

fatbelly

An IVA is possible at £300 x 60 on 40k debt but if you are thinking of selling then all the released equity would go into the iva. If income falls, the iva would be likely to fail and you are back to square one. If your surplus rises you will be reassessed and pay more. A dmp is the safer route for now.

warby68

Don't easily give up the security of your own home, especially when its relatively cheap to service the mortgage compared to renting.

You sound like you've had a bad time recently all round which may be driving the need for a drastic change. Most debt situations do tend to involve long term change and plodding though. On the plus side, your circumstances CAN easily and quickly change as children get older, you earn more , husband gets a job etc.

Maybe look at just steadying the ship for now which is what a DMP coiuld do for you. Get used to a tighter budget and then look again after a while. The 8 years is only on current figures and it can adapt to changes and doesn't tie you in for ever. Yes you will affect your credit history but so does everything else you're looking at.

Not in your shoes of course but your budget does look like you can cover the bills and a reasonable standard of living with some scope for more economy as well. That adds weight to the argument for parking the debt in an affordable DMP rather than other solutions which actually might take more of the budget 'fat' from you.

You infer your troubles only started recently but your debts are quite chunky at £40k so a little bit about the reasons for the debt and whether these reasons are behind you might help with advice too.

Even a small seasonal role or some online earning for husband will make a difference - even the amount that still allows you to keep the carer's allowance could help.

fatbelly

warby68 wrote: »

Even a small seasonal role or some online earning for husband will make a difference - even the amount that still allows you to keep the carer's allowance could help.

The rules are relatively generous on that:

•your income must be less than £123 a week after tax, national insurance and expenses

The following are not counted as income:
•contributions towards your living or accommodation costs from someone you live with (they cannot be a tenant or boarder)
•the first £20 a week and 50% of the rest of any income you make from someone boarding in your home
•a loan or advance payment from your employer

Expenses can include:
•50% of your pension contributions
•equipment you need to do your job, for example specialist clothing
•travel costs between different workplaces that are not paid for by your employer, for example fuel or train fares
•business costs if you’re self-employed, for example a computer you only use for work
If you pay a carer to look after the disabled person or your children while you work, you can treat care costs that are less than or equal to 50% of your earnings as an expense. The carer must not be your spouse, partner, parent, child or sibling.

enthusiasticsaver

I would not go bankrupt and lose your house when you can sort this with some cost cutting and a DMP. Getting a council house is not that easy these days and if you move into your parents you are not officially homeless so will not be a priority. You will not have a say in where you get put (at the councils whim) and you will find that going into private rented will cost you more than a mortgage.

The groceries amount is far too high for a family of 4. Use Lidls or Aldis and batch cook from scratch. Limit takeaways and alcohol.

I think you do need something for entertainment and presents but you can do without a holiday for a few years until you are in a better position. Your husband could do some evening work like bar tending, restaurant or stacking shelves.

enthusiasticsaver

You also will not be able to keep the car if you go bankrupt. I think there is a limit of £1k so essentially an old banger is all they allow you.

MovingForwards

Got to agree with Fatbelly:

"The rules are relatively generous on that:

•your income must be less than £123 a week after tax, national insurance and expenses."

Again, seasonal / temp / permanent part-time work in a supermarket will bring in under £123pw, which is extra money to throw at your debts. Gets your husband out the house and helping to sort out the position you are currently in.

I do hope you have woken up with a more clear head and have taken all comments on board.

There is a long-term way to clear the debts and keep your house. This is what you need to be focusing on.