Help I have been stupid

MissReckless

Hey guys my First post!

Me and my partner are in 37k of debt.
I spoke to step changers today they advised iva or dmp as we are home owners( No Equity)

My worry is 20k of this debt is only 6month ago with several loans with garrantor loans with high interest.

Anyhow its come to the point were we can no longer keep up the payments but i am so worried about these loans as they are so recent And these loans was very stupid of us to take out
We were just desperate at the time.
I wish i could turn back time.

Will There be consequences to this

Astar1809

You may be lucky and get the interest frozen or similar as you are entering an IVA, but you mention Guarantor loans, they are very likely to seek repayment from them if you let them know you cannot keep up with payments.

What consequences are you worrying about?

MissReckless

Hi
We were guarantor with each other me and worried because it was stupid taking extras loans out knowing full well we could not afford them

ratrace

what has the 20k been spent on and is there a way you could sellthe items back to pay the debt down as fast as possible

sourcrates

MissReckless wrote: »

My worry is 20k of this debt is only 6month ago with several loans with garrantor loans with high interest.

i am so worried about these loans as they are so recent And these loans was very stupid of us to take out
We were just desperate at the time.
I wish i could turn back time.

Will There be consequences to this

Hi,

Unfortunatly most people think they can borrow their way out of debt, when in reality you really can`t, so don`t beat yourself up about it too much, you are not alone.

The only problem with the loans is that as soon as you each miss a contracted payment, the creditor will attempt to take it from the guarantor, you cannot debt mange a guarantor loan due to their very nature you either keep up contracted payments on them, or you default and the guarentor pays, i`m not sure how that would work if you each guarantee each others loans, did i read that correctly by the way ?

kazwookie

What did you spend the loans on?


Can you sell the item/s and pay the money back?

Willing2Learn

Hi MissReckless,

So you and your partner already had 17K of debt, before the guarantor loans for a further 20K. Is that correct?

Please can you complete a Statement of Affair (SOA).
Please remember to click on the 'format for MSE' button

MissReckless

Hiya
We spent most on house backgarden windows and doors carpets new boiler etc
Also bought a puppy and had little bit left just to survive without missing payments sota speak.
I know it was stupid and i wish we could take it back
I cant tell you how bad i feel:(

MissReckless

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................ 1600
Partners monthly income after tax....... 750
Benefits................................ 209
Other income............................ 0
Total monthly income.................... 2559

Monthly Expense Details
Mortgage................................ 585
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 116
Electricity............................. 60
Gas..................................... 60
Oil..................................... 0
Water rates............................. 59
Telephone (land line)................... 0
Mobile phone............................ 75
TV Licence.............................. 12
Satellite/Cable TV...................... 0
Internet Services....................... 50
Groceries etc. ......................... 600
Clothing................................ 50
Petrol/diesel........................... 140
Road tax................................ 14
Car Insurance........................... 80
Car maintenance (including MOT)......... 50
Car parking............................. 10
Other travel............................ 15
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 15
Pet insurance/vet bills................. 35
Buildings insurance..................... 18
Contents insurance...................... 0
Life assurance ......................... 30
Other insurance......................... 0
Presents (birthday, christmas etc)...... 40
Haircuts................................ 35
Entertainment........................... 50
Holiday................................. 50
Emergency fund.......................... 20
Total monthly expenses.................. 2269


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 6000
Other assets............................ 0
Total Assets............................ 6000


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 147000...(585)......0
Total secured & HP debts...... 147000....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Loan...........................9200......400.......0
Loan...........................8500......400.......0
Loan...........................17000.....270.......0
Parents........................14000.....0.........0
Store Credit...................4000......95........0
Credit card....................1500......40........0
Total unsecured debts..........54200.....1205......-


Monthly Budget Summary
Total monthly income.................... 2,559
Expenses (including HP & secured debts). 2,269
Available for debt repayments........... 290
Monthly UNsecured debt repayments....... 1,205
Amount short for making debt repayments. -915

Personal Balance Sheet Summary
Total assets (things you own)........... 6,000
Total HP & Secured debt................. -147,000
Total Unsecured debt.................... -54,200
Net Assets.............................. -195,200

We have 3 kids 5 3 1.
Mobiles are high i know
Contracted for a further year unfortunately.

monetxchange

Someone much more experienced than I am will give you the right advice, but it’s looking like some kind of debt plan would be the only option here.

God knows how they let you guarantee each others loans at the same address and both presumably with maxed out credit utilisation. Very irresponsible from them too.

Okay, so you know you’ve made some big financial mistakes, so I won’t go on at you. The best thing you can do from this situation is LEARN from it. You can’t borrow your way out of debt, nor can you finance a lifestyle you can’t afford with unsecured credit. Going forward, if you want expensive things, you and your partner are going to have to increase your earning potential. £2,500 a month is always going to be tight for 5 of you, esp if you want luxuries.

You absolutely can sort this. Find the right route for you and then budget properly on future and stick to it. Lots you can trim on your SOA as you get clear - most notably groceries, phones when out of contract, check your utilities for cheaper deals, no holidays for a while. Best of luck on your journey and well done for taking your first step.

[Deleted User]

MissReckless wrote: »

Hey guys my First post!

Me and my partner are in 37k of debt.
I spoke to step changers today they advised iva or dmp as we are home owners( No Equity)

My worry is 20k of this debt is only 6month ago with several loans with garrantor loans with high interest.

Anyhow its come to the point were we can no longer keep up the payments but i am so worried about these loans as they are so recent And these loans was very stupid of us to take out
We were just desperate at the time.
I wish i could turn back time.

Will There be consequences to this

Hi MissReckless,


I take my hat off to you.
You have already done the hardest part - you have had your 'lightbulb moment' where you have seen the severity of your situation and it has been realised and acknowledged.


Most members on here have had theirs hence being on here !


The next steps are to study your Statement Of Affairs, with the members who will have a little bit more time than me, and they will go through details with you, they will help you see things in a more distanced way because when you're in the thick of it you're blinkered.


They will critique, and assess, your SOA and will comment on specific points.
This will, possibly, make you flinch and squirm but - face it square-on and it/they will get you through it.