Where to start? Help with SOA/BR

Holly_Jones4

Hi there


I am new here and would love some support/advice around how to go about dealing (finally!) with my debt. Very briefly, my debt has accumulated since my divorce and has been the result of having to 'top up' my outgoings every month for the last 12 years. I work full time and have raised 3 children, 1 of which is still at home (13) and two who are at University (they spend 4 months at home per academic yr) Our family home was sold as part of the divorce so we have been privately renting for 12 years now (moved x 4). Salary far too low to afford a mortgage, now or in the future. My car is of very little value and I have nothing significant enough to sell to even make a dent in the debts.


I have spoken to Step Change and CAB and they have both suggested a IVA. DMP will take over 20 years so obvs not an option. I would rather go down the BR route simply because either way my credit score is screwed and both will remain on file for 6 years but with an IVA I would be paying for longer.


As you can see from my SOA I have 'other income' which I can break down as being:
£83 child benefit
£150 child maintence
£401 tax credits
£462 housing benefit


All of the above stand to finish once my youngest reaches 16 yrs so my income will drop dramatically.


I would really appreciate any thoughts on my SOA and whether it is realistic or not. I really want to avoid paying an IPA so wondering if anyone thinks there is any wiggle room?


I think I have made the decision to go down the BR route but if anyone thinks an IVA would be more beneficial I would love to know.


Sorry for long post! Any help would be much appreciated.


Holly


Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 1
Number of children in household......... 1
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 1138
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 1096
Total monthly income.................... 2234
Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 1125
Management charge (leasehold property).. 0
Council tax............................. 125
Electricity............................. 37
Gas..................................... 36
Oil..................................... 0
Water rates............................. 53
Telephone (land line)................... 20
Mobile phone............................ 40
TV Licence.............................. 13.26
Satellite/Cable TV...................... 20
Internet Services....................... 20
Groceries etc. ......................... 435
Clothing................................ 15
Petrol/diesel........................... 60
Road tax................................ 14
Car Insurance........................... 22.06
Car maintenance (including MOT)......... 20
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 20
Haircuts................................ 24
Entertainment........................... 20
Holiday................................. 35
Emergency fund.......................... 30
Total monthly expenses.................. 2184.32

Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 700
Other assets............................ 0
Total Assets............................ 700

No Secured nor Hire Purchase Debts
Unsecured Debts
Description....................Debt......Monthly...APR
Creation UK loan...............14776.4...369.4.....0
Ratesetter loan................9698.74...232.7.....0
Capital One cred card..........3012.32...165.1.....0
Lloyds TSB overdraft...........3500......0.........0
Tesco credit card..............2915.44...135.......0

TheGardener

You need to mention the older children, feeding them for 25% of the the year needs to be included. Add £30 per mth to cover feeding them when they are home.
Parking - put in at least £10 - everyone pays for parking somewhere - costs me £2.50 a week to go to town to do the shopping once a week.
Medical for 1 adult per year = 1 x flu jab + 2 x Dental check ups+ 1 x filling/scale and polish + 2 x pescriptions = approx £12 per mth. Do you have glasses?
Contents insurance is a must £10 per mth

Try and aim for the same going out as coming in. The OR should disreguard any benefits income.

Holly_Jones4

Thank you Gardener, yes you are right that's all very good advice. I think, after reading so many posts and doing research, it would seem that most of us are very unrealistic when doing our 1st SOA!

It's very difficult because I don't want to seem too greedy but in reality it would be difficult to live within the constraints of an unrealistic one.

Thanks again, I'm going to go through it again. Bit of a scary business though this BR... :-/

Holly

MovingForwards

You need to have something for car maintenance / MOT, I would suggest £50pm.

Holly_Jones4

That's another good shout! Thank you MovingForward

DavidDAM

Hi Holly,

Good luck with everything. I was under the assumption that benefits did not count as income when calculating a SOA.

enthusiasticsaver

I think the car maintenance is too low for such a low value car and agree £50 a month is more realistic.

The groceries figure looks a little high for just one adult and one child even if you are also catering for two other adults for 4 months a year. It may be questioned but I guess at certain times it is really 4 adults as most teenagers eat as much as an adult.

I think the emergency savings is too low and you should put £50.

Given you have no assets to protect and the surplus is so low (meaning a very long DMP) then bankruptcy is a strong possibility unless this will impact on your job. I am not sure if this will impact on your ability to rent privately in the future though so is your tenancy secure?

Why is an IVA being recommended?

enthusiasticsaver

I would have said your income was too low and you are too dependent on benefits for an IVA to be suitable especially as you know they will drop in 3 years time when your youngest gets to 16. The key thing with IVAs is that they are usually best if you are in steady permanent employment and have some spare money. You do not really have spare money as such.

TheGardener

Holly_Jones4 wrote: »

....I don't want to seem too greedy but in reality it would be difficult to live within the constraints of an unrealistic one.

A single parent with rent that accounts for nearly half your income!? - if an OR asks for an IPA you must challenge it, I'd be surprised if they ask for one but if they do come back here for advice.