70k debt - what are my options? SOA included

fatbelly

I assumed the rent arrears were 'former tenancy'

No-one's going to come around for the laptop

Other than that the plan looks good

JCS1

Assuming the car is on HP and there is no equity in it.

The OR would send a letter of non-adopt to the HP company, and it is then down to the HP Company to decide what to do.

However, given the value of repairs needed, would you be better of not paying any debts for a few months and buying something under the £2k value to use instead?

enthusiasticsaver

I agree that defaulting on the debts and applying for bankruptcy will allow you to put this whole sorry mess behind you. Check with the OR what can be included. You can then move back to a more normal work/life balance and start to get your finances straight. You won’t make headway while paying that amount of interest otherwise. I think saving for a car for £2k is sensible as I am not sure if the car deal will have to finish. 

Imogen_trucker

fatbelly said:

Sounds like HP, not a loan. If you've paid more than a third, they need a court order to repossess. 

Not yours to sell - and the hpi marker should put off any prospective purchaser.

You're going to need one that you own, and is worth less than 2k

Any monies owed to the finance company are covered by the bankruptcy.

Yes it's hire purchase, the original balance was £6609.12 and I've paid £2065.35.

If I could get a friend to lend me the settlement figure of £3696.05, I would then own the car wouldn't I? My best friend has offered to do that for me, if it means I can keep the car. Would I then have to transfer ownership to her? As I'm sure if I'm going to take the option of bankruptcy, I would only be made to sell it anyway wouldn't I? Technically it would be hers anyway, until I paid her back for it, but she knows I wouldn't be able to start doing that for a few years. A very kind offer I know.

Imogen_trucker

EssexHebridean said:

All of the below is subject to agreement from someone like fatbelly who knows the legal implications around bankruptcy more than I do. 

A quick tot up and it looks to me like there is around £470 of payments to cards/store accounts that you can cancel the DD’s for. The laptop, I would be inclined to consider just clearing off with the saving from not paying the cards in month one - as I assume the laptop is needed by the family? I mean realistically the likelihood anyone coming to take it away is probably slim, but still, for peace of mind I would get it gone. 

Are the rent arrears for the property where you are living now? Assuming yes, then personally I’d also be wanting to get those paid - assuming you plan to stay there and would like to stay on good terms with your landlord. That advice may be questionable though - I’m just mindful of how a landlord might feel/react to being told a tenant owes them arrears but is now bankrupt. 😬

You need to keep paying the DV Debt, the utility arrears, and - for now anyway - the car finance, I think. 

You also need to start working to get your budget absolutely on point. You’re already aware what a slippery slope using credit can become when your circumstances conspire to turn a situation to an extreme - going forward that safety net simply won’t be there so you HAVE to know your budget is watertight.  

On the SOA:
 you have nothing in the sections for mobile phone, landline or internet. Do you not have these things, or are they bundled elsewhere?

Are you putting aside the money shown for car maintenance? If not, you need to start - the same goes for the “presents” money too - if you budget it on paper you MUST also budget it in cash terms too. For context - if you think you are putting aside £55 a month across those two categories, but in fact you’re not, that’s £660 a year you are literally losing. 
Insurance - both car and contents are high - is there a reason why do you know? Have you followed the MSE method for getting the best price? (Car will be higher for you as ai assume it’s just you on the policy - crazily this often makes things more expensive.
Have you checked that you are getting every single penny of benefits you should? 

Is the “medical” spend anything that could be reduced by using, for example, a prescription pre-payment? 

Lots to be working on, but rest assured you are now taking constructive steps, and above all YOU have control of this situation - I suspect you’ve not been able to feel that for a while. 

The laptop is mostly mine really, the children have their own PC's, I bought it a few years ago for my Mum, but I use it now.

The rent arrears are for my current property, it's a housing association property, as we were made homeless earlier this year by my previous private landlord selling the house we had lived in for 4 years. I've arranged with the council to pay an extra £50 each month on top of my usual rent to clear the arrears.

Yes, I've always thought I was fairly good with money. I don't buy clothes, makeup etc like most of my friends do. I haven't been on holiday since I was 18. I don't have a large TV or a nice sofa. I don't even currently own a wardrobe! But having spent the last few days on this website, I think I've realised that I do probably waste money on things I shouldn't - little trips to the corner shop, unnecessary journeys in the car, rewashing the laundry 3 times over as I keep forgetting it's in there haha.

- the £45.99 a month for Satellite/Cable TV on my SOA is for my landline, TV, broadband and mobile phone, it's a combined package
- no I have never put money aside each month for car maintenance or presents, I just find the money at the time, usually because I never have money left over to put aside
- I will look into the contents insurance and see if I can get a cheaper deal, I've never really had it before - what's a good price? The only thing I got it to cover is the children's PC's and gadgets, they are both worth quite a lot of money
- My car insurance is high because of my job, and also because I only have 4 years no claims I think, and yes just me on the policy
- I am not entitled to anything more in benefits unfortunately, I have recently had advice on that
- The medical is for my contact lenses, I can't wear glasses in my job

Yes I do feel very reassured, not only knowing there are options, but also that I'm feeling motivated for the first time in months to get this sorted. Thank you again for you advice and support, it's generous and appreciated

Imogen_trucker

fatbelly said:

I assumed the rent arrears were 'former tenancy'

No-one's going to come around for the laptop

Other than that the plan looks good

The rent arrears are for my current property, it's a housing association property. I've arranged with the council to pay an extra £50 each month on top of my usual rent to clear the arrears.

Imogen_trucker

JCS1 said:

Assuming the car is on HP and there is no equity in it.

The OR would send a letter of non-adopt to the HP company, and it is then down to the HP Company to decide what to do.

However, given the value of repairs needed, would you be better of not paying any debts for a few months and buying something under the £2k value to use instead?

Yes it's hire purchase, the original balance was £6609.12 and I've paid £2065.35.

If I could get a friend to lend me the settlement figure of £3696.05, I would then own the car wouldn't I? My best friend has offered to do that for me, if it means I can keep the car. Would I then have to transfer ownership to her? As I'm sure if I'm going to take the option of bankruptcy, I would only be made to sell it anyway wouldn't I? Technically it would be hers anyway, until I paid her back for it, but she knows I wouldn't be able to start doing that for a few years. A very kind offer I know.

JCS1

Imogen_trucker said:

fatbelly said:

Sounds like HP, not a loan. If you've paid more than a third, they need a court order to repossess. 

Not yours to sell - and the hpi marker should put off any prospective purchaser.

You're going to need one that you own, and is worth less than 2k

Any monies owed to the finance company are covered by the bankruptcy.

Yes it's hire purchase, the original balance was £6609.12 and I've paid £2065.35.

If I could get a friend to lend me the settlement figure of £3696.05, I would then own the car wouldn't I? My best friend has offered to do that for me, if it means I can keep the car. Would I then have to transfer ownership to her? As I'm sure if I'm going to take the option of bankruptcy, I would only be made to sell it anyway wouldn't I? Technically it would be hers anyway, until I paid her back for it, but she knows I wouldn't be able to start doing that for a few years. A very kind offer I know.

The OR could overturn that transaction and it would potentially lead to more issues.  

Imogen_trucker

enthusiasticsaver said:

I agree that defaulting on the debts and applying for bankruptcy will allow you to put this whole sorry mess behind you. Check with the OR what can be included. You can then move back to a more normal work/life balance and start to get your finances straight. You won’t make headway while paying that amount of interest otherwise. I think saving for a car for £2k is sensible as I am not sure if the car deal will have to finish. 

This made me chuckle to myself, it really is a sorry mess isn't it. I sometimes wonder how I got in this situation - why all the trauma, the never ending bad luck, the vicious financial circle. 

Sea_Shell

I'd advise against accepting a loan from a friend, especially for that much.

When would you expect to be able to eventually pay them back?

Would it put a strain on your relationship if you couldn't?

If they are happy to GIFT you an amount of cash (even if much less), then that's a different call.

Money issues can sometimes be a way to lose a good friend.