So here goes - this is bad but I need to so something about it
jondebtz
Forumite 4 Posts
Hello,.
Bit nervous about this but it's time to sort it out. We have big debts and have been getting our heads around our current situation.The debt built up over many years. We funded several rounds of IVF, our wedding, house renovations etc and now we are at the stage where we have to deal with it. Thankfully we have a good enough income to get out of the hole we are in.....I think!
Here is our current SOA.
Please be gentle. I am deeply ashamed. We have more debt than anyone I have ever known
Bit nervous about this but it's time to sort it out. We have big debts and have been getting our heads around our current situation.The debt built up over many years. We funded several rounds of IVF, our wedding, house renovations etc and now we are at the stage where we have to deal with it. Thankfully we have a good enough income to get out of the hole we are in.....I think!
Here is our current SOA.
Household Information[/b]
Number of adults in household........... 2
Number of children in household......... 1
Number of cars owned.................... 2[b]
Monthly Income Details[/b]
Monthly income after tax................ 4093
Partners monthly income after tax....... 1460
Benefits................................ 515
Other income............................ 400[b]
Total monthly income.................... 6468[/b][b]
Monthly Expense Details[/b]
Mortgage................................ 520
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 106
Electricity............................. 100
Gas..................................... 186
Oil..................................... 0
Water rates............................. 32
Telephone (land line)................... 12
Mobile phone............................ 80
TV Licence.............................. 12
Satellite/Cable TV...................... 59
Internet Services....................... 0
Groceries etc. ......................... 500
Clothing................................ 50
Petrol/diesel........................... 300
Road tax................................ 5
Car Insurance........................... 58
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 100
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 10
Pet insurance/vet bills................. 36
Buildings insurance..................... 10
Contents insurance...................... 9
Life assurance ......................... 33
Other insurance......................... 0
Presents (birthday, christmas etc)...... 100
Haircuts................................ 20
Entertainment........................... 200
Holiday................................. 0
Emergency fund.......................... 100[b]
Total monthly expenses.................. 2638[/b]
[b]
Assets[/b]
Cash.................................... 2000
House value (Gross)..................... 250000
Shares and bonds........................ 0
Car(s).................................. 8000
Other assets............................ 0[b]
Total Assets............................ 260000[/b]
[b]
Secured & HP Debts[/b]
Description....................Debt......Monthly...APR
Mortgage...................... 47000....(520)......1.8[b]
Total secured & HP debts...... 47000.....-.........- [/b]
[b]Unsecured Debts[/b]
Description....................Debt......Monthly...APR
Updraft consolidation..........28000.....630.......0
Barclayard 1...................12800.....234.......6.9
Barclaycard 2..................4800......108.......6.9
Parents........................5000......0.........0 - no pressure on this one
Drafty.........................1300......167.......0 - horrendous - something like 188%apr
Tesco CC.......................3500......35........0
Creation card..................4000......40........0
MBNA...........................10400.....325.......19.9
Halifax loan...................6800......132.......6.9[b]
Total unsecured debts..........76600.....1671......- [/b]
[b]
Monthly Budget Summary[/b]
Total monthly income.................... 6,468
Expenses (including HP & secured debts). 2,638
Available for debt repayments........... 3,830
Monthly UNsecured debt repayments....... 1,671[b]
Amount left after debt repayments....... 2,159[/b]
[b]Personal Balance Sheet Summary[/b]
Total assets (things you own)........... 260,000
Total HP & Secured debt................. -47,000
Total Unsecured debt.................... -76,600[b]
Net Assets.............................. 136,400[/b]
Please be gentle. I am deeply ashamed. We have more debt than anyone I have ever known
0
Latest MSE News and Guides
Replies
What jumps out is that according to your SOA you have more than £2000 left over each month, with that you could clear Drafty in one month, so is the SOA correct?
My comments in bold...
EF Challenger #3 £300.51 / £5000
MFW 2023 #100 £2550.00 / £10,000
MFiT #40 Jan 2025 Target - £99,999.00
Mortgage at 30/09/22 £113694.11
Mortgage at 24/01/23 £110707.87
Get rid of draft first the maybe the next highest Apr.
Actual mortgage stating amount £75,150
Overpayment start date 1/3/23.
Starting balance £66,565.45
Current balance -£65,553.80
You're right about the income - and allowing for that the SOA needs slightly different handling to normal I'd say. however, you do need to be sure that once you finalise your budget you then stick to what is in it and maintain the surplus for throwing at the debt. You're in an incredibly fortunate position though - if the surplus shown is correct, and can be maintained, you can be free of a quite large debt remarkably fast.
You're showing a really good monthly surplus - which is clearly great from the perspective of paying off debt, but of course the problem is, that you don't actually have that left at the end of a month do you? Usually it's not too easy to be sure - but in your case it is - your debt is all from traceable things, so if you really had that much money left over at the end of the month your current account would be swimming in a sea of loose notes and you'd be able to clear off the worst of the debts just using that. That you clearly don't have that sea of loose notes gives you a further problem though - and that is that your budget is probably not right. That's not a problem though - you'll find out soon enough and it is a work in progress at this stage anyway.
Hopefully now you have started focusing on what is being spent - that will mean that at the end of this month you WILL have enough in the pot to just get Drafty gone - so as son as you are confident that you can do so without leaving yourself short - pay it off - at that interest rate it would be daft not to. In fact, if you can be confident now that you will definitely have say £500 spare from this month, pay that against it now to reduce the accruing interest. You can always clear the rest later.
Then based on the current repayments + surplus each month and it would be pretty quick.
40000 over 3 years is 1200 month.
If those premiums were added to the updraft consolidation then you would still be 2000 clear each month which you could use pay off the overall debt including the updraft consolidation even sooner.
Slashing current expenditure may not be needed for repayment purposes though rationalisation of expenditure based upon cost : value/pleasure : effort could free up more funds to accelerate repayment, for other beneficial investments/activities or simply serve as a greater contingency fund for the next few years.
I'd advise against another consolidation loan - you don't get out of debt with new debt. Just focus on paying down what there is - with your disposable income, and several already on 0% deals, that seems the route to go down.
I would suspect you don`t have 2k sat idly in your account every month either, hence why you have posted on here, would I be right in that assumption ?
More than a third of IVA`s fail....fact.
Could A Debt Relief Order help you ?
Never pay a fee for a Debt Management Plan.
For free non-judgemental debt advice, contact either : Stepchange, National Debtline, or CitizensAdviceBureaux.
Well done for posting, and looking forward to seeing you post your debt free post in the not too distant future!