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Sinking - Need advise on way out of debt.

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Good Evening all,
I currently bought a new house just before xmas 2019 and was awaiting on the sale of my current house at the time but that fell through and due to COVID there has been zero interest and i am struggling with all debts. 
I have approx £100k unsecured debt along with a 2nd mortgage. My outgoings are alot more than my incoming and i honestly dont know best way forward. I live in scotland not sure on best way to approach this and want to try sort something out.

Thank you in advance for any replies and help.
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Comments

  • ryanm8655
    ryanm8655 Posts: 1,201 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    First thirst things first complete and post an SOA: https://www.lemonfool.co.uk/financecalculators/soa.php

    Then people will be able to advise. Could you let your old property?

    August 2019: £28.8k

    November 2020: £0 (0% interest)

    My debt free diary: https://forums.moneysavingexpert.com/discussion/comment/77330320#Comment_77330320

    <br>

  • I would recommend:
    1. Try and rent out one of your properties so you can attempt to get income in to help cover the mortgage.
    2. Have you had any assistance with your debts and consolidation of them? Worth reviewing which ones have the greatest interest charges and focus on them.  Money advice service website has some useful guidance.
    3. Review your current outgoings and bills, can you stop any unnecessary subscriptions or payments? Are you able to get better deals on your utilities etc?
    4. have you considered what ways you can generate extra income, is it possible to get a 2nd job?
  • Richmc1983
    Richmc1983 Posts: 56 Forumite
    Eighth Anniversary 10 Posts Combo Breaker
    Hi all. Thanks for reply. 

    1. I looked into renting out property and would need to spend money to get it upto scratch for renting and also means rent would be less and hard to get due to size of house and area. 
    2. 2nd job is no option as already work away from home
    3. unable to change anything as looked into outgoings and already cancelled everything i dont need. 
    4. I really am stuck and unsure on how to approach creditors regarding this?

  • MovingForwards
    MovingForwards Posts: 17,149 Forumite
    10,000 Posts Seventh Anniversary Name Dropper Photogenic
    If you take your old property and the mortgage payment out of the equation, can you manage your income / debts?

    If so, how much mortgage is outstanding on the property and what have you listed it for sale at?

    Also, please do create the statement of affairs as that way we can help you work out what debt payment options are suitable.
    Mortgage started 2020, aiming to clear 31/12/2029.
  • fatbelly
    fatbelly Posts: 22,951 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Cashback Cashier
    Hi all. Thanks for reply. 

    1. I looked into renting out property and would need to spend money to get it upto scratch for renting and also means rent would be less and hard to get due to size of house and area. 
    2. 2nd job is no option as already work away from home
    3. unable to change anything as looked into outgoings and already cancelled everything i dont need. 
    4. I really am stuck and unsure on how to approach creditors regarding this?

    It's a case of working out what you can afford to pay, and not paying the rest. So you need to prioritise. If you post a statement of affairs we can help.

    You need to identify the Non-priority creditors and if things are tough, prioritise the priority ones
  • Richmc1983
    Richmc1983 Posts: 56 Forumite
    Eighth Anniversary 10 Posts Combo Breaker
    edited 2 September 2020 at 12:13PM

    Household Information

    Number of adults in household2
    Number of children in household2
    Number of cars owned0

    Monthly Income & Expense Summary

    Monthly Budget SummaryAmount(£)
    Total monthly income4,800
    Monthly expenses (incl. HP & secured loans)4,650
    Available for unsecured debt repayments150

    Monthly Income & Expense Details

    IncomeAmount(£)
    Monthly income after tax4800
    Partners monthly income0
    Benefits0
    Other income0
    Total monthly income4800

    ExpensesAmount(£)
    Mortgage1666
    Secured/HP loan payments1200
    Rent0
    Management charge (leasehold property)0
    Council tax219
    Electricity76
    Gas73
    Oil0
    Water Rates0
    Telephone (land line)0
    Mobile phone98
    TV Licence13
    Satellite/Cable TV0
    Internet services0
    Groceries etc.200
    Clothing0
    Car expenses (fuel, tax, insurance etc.)300
    Other travel150
    Childcare/nursery250
    Other child related expenses200
    Medical (prescriptions, dentists, opticians etc.)0
    Pet Insurance/Vet bills0
    Buildings & Contents Insurance25
    Life Assurance180
    Other Insurance0
    Emergency Fund0
    Total monthly expenses4650

    Debt Details & Offer to Creditors

    Secured & HP Debt DescriptionDebt(£)Monthly(£)
    Mortgage370000(1666)
    Secured Debt300000(1200)
    Secured & HP Debt totals670000-

    Unsecured Debt DescriptionDebt(£)Offer(£)
    HSBC Loan2150034.9
    HSBC Loan750012.18
    Leaseplan Van00
    Overdraft50008.12
    Gym Equipment45007.31
    Lloyds Credit Card1100017.86
    Lease Car00
    MBNA Credit Card900014.61
    MBNA Credit Card1500024.35
    Tesco Credit Card900014.61
    HSBC Credit Card790012.82
    Sainsbury Credit Card20003.25
    Unsecured Debt totals92400150.01

  • Hi
    Glad you came back! Any move on the house sale???? 
    There is some key info missing - which is your assets (the value of your properties, plus car). Since your question resolves around a house sale (partly) I think people will need this to help.
    Aso your unsecured debt seems to have formatted strangely - is that the APR that is showing? What are the monthly minimum payments?
    Are business debts included here? I see van lease and gym equipment....are these personal debts or business debts?
    The solution comes from looking at these details, so you will get good advice when you can fix the info missing.


    March 2020 - 21k of debt; September 2020 - 14k of debt. Debt free target date September 2021 
    Diary of paying down debt whilst living abroad:https://forums.moneysavingexpert.com/discussion/6181237/5-000-miles-and-even-more-pounds#latest


  • First thing is it right your partner has no income? Could they get a job even if it's part time? You mention childcare costs so if their not working could that be saved?

    Mobile phones seem very high so could you go sim only to save money?

    You have car expenses but state no car. Is this an error? You also have £150 in other travel expenses, could this be reviewed?

    Life assurance also seems very high. Have you looked for a different policy?

    You mention another property what is the mortgage on it and what is up for sale for? It may be worth dropping the price so it is sold as I assume the secured debt payments would stop so you could then use that for your other debts.

    You mention arrangements or offers to your unsecured debt was this done via a DMP? If not it is probably worth talking to Stepchange about your options. 
  • TheAble
    TheAble Posts: 1,676 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    Are you really paying a £180/month premium for life insurance??
  • monetxchange
    monetxchange Posts: 552 Forumite
    500 Posts Third Anniversary Name Dropper Photogenic
    edited 2 September 2020 at 7:39PM
    Is the groceries spend realistic, or just what you think it should be? If your partner is the stay at home parent, I'm sure they'd be able to tell you the figure is probably much higher for two adults and two kids. £200 would be beans and rice level, and looking at your other expenses and accrued debt I would hazard a guess that you don't keep a tight rein on spending even on food. Same goes for the £0 clothes budget. Impossible with two kids. Is this simply expenses you don't think of as existing as it gets stuck on one of the credit cards and forgotten about? 

    Not a criticism - it's just important to be honest at the start so you don't under budget and fall at the first hurdle.

    Like others have said, there's so much that can be trimmed on wants rather than needs here. You need to cut back to bare bones level on things like phones and petrol etc. Main thing is your partner needs to work. Do alternate shifts if you must. You simply can't afford this lifestyle on a single income with multiple properties etc.
    Debt Free: 06/03/2020 Highest Debt: £37,514
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