Do I do a DMP

Wannabehousebuyer

Hi everyone,

Everyone helped so much when I was looking to buy my house, which i did! yay! although I am scared I am going to lose it.... I really need some help if anyone can, Its bank holiday and no debt charities are open and all direct debits are due out tomorrow and I am debating a DMP and wow my head is going round and round.

In short I bought 50% SO house, on my own, my share £150,000 (5 year fixed) been here 15 months now, in that time my world has just been tipped upside down. Not only has COL crisis struck on a single income house hold, I lost my mum (context I'm 32) last September, and it has just hit me like a tonne of bricks - as one would imagine, except my debt has sky rocketed (commission based job- commission takes 6ish months to come in) so now im being hit where it hurts. I have my basic salary only and im not performing great at work so im in for a time of money that does'nt aline with my debts.  

I have had DMP before, so i know how it all works but I am worried that when I come to remortgage I would have done myself up like a kipper. Not only will i hopefully want to move( hopefully im settle with a potential family etc). I have done an SOA  which i have posted below, It is rough as I just wanted to see some figures, I have certainly missed some bits off as i dont have ANY spare money, and i worked out i am about 400 short this month. so certainly somewhere. 

Also as FYI - with my credit cards im on like a medical break where i am paying the small amount of interest £20ish each to help me get back on my feet but that all ends soon, so I am going to feel those £90 ish EACH payments like no other. 

I am 400 in mortgage arrears and £2000 on my rent , they have been threatening going to my mortgage company, but i have managed to say i can affford 50 a month to start paying it back. my gas and electric is about 400 in arrears as well as about 200 on my water. 

Not only am I greieving and just a mess, I am now on my own 24/7 as i have no money to do anything and I think my brain is going to burst. 

If anyone can help me, i would be so so greatful, I feel like i could breakdown any moment.


TO NOTE- I have a company car- hence no car expenses
I will be earning more again, but when - who knows
mobile phone - i pay for my brothers phone as well as my own
APR's i am looking for but from memory they are all 30ish % - my credit isnt great hence why i cannot move the 0% deals

ousehold Information[/b]

Number of adults in household........... 1

Number of children in household......... 0

Number of cars owned.................... 0[b]

Monthly Income Details[/b]

Monthly income after tax................ 2000

Partners monthly income after tax....... 0

Benefits................................ 0

Other income............................ 0[b]

Total monthly income.................... 2000[/b][b]

Monthly Expense Details[/b]

Mortgage................................ 650

Secured/HP loan repayments.............. 0

Rent.................................... 454

Management charge (leasehold property).. 0

Council tax............................. 159

Electricity............................. 50

Gas..................................... 50

Oil..................................... 0

Water rates............................. 40

Telephone (land line)................... 0

Mobile phone............................ 100

TV Licence.............................. 14

Satellite/Cable TV...................... 50.5

Internet Services....................... 0

Groceries etc. ......................... 200

Clothing................................ 0

Petrol/diesel........................... 100

Road tax................................ 0

Car Insurance........................... 0

Car maintenance (including MOT)......... 0

Car parking............................. 0

Other travel............................ 0

Childcare/nursery....................... 0

Other child related expenses............ 0

Medical (prescriptions, dentist etc).... 0

Pet insurance/vet bills................. 12.81

Buildings insurance..................... 0

Contents insurance...................... 6

Life assurance ......................... 17

Other insurance......................... 0

Presents (birthday, christmas etc)...... 0

Haircuts................................ 0

Entertainment........................... 0

Holiday................................. 0

Emergency fund.......................... 0

(Unnamed monthly expense)............... 0

Washing Machine over ................... 9

British Gas Cover....................... 30[b]

Total monthly expenses.................. 1942.31[/b]

[b]

Assets[/b]

Cash.................................... 0

House value (Gross)..................... 160000

Shares and bonds........................ 0

Car(s).................................. 0

Other assets............................ 0[b]

Total Assets............................ 160000[/b]

[b]

Secured & HP Debts[/b]

Description....................Debt......Monthly...APR

Mortgage...................... 132000...(650)......4.2[b]

Total secured & HP debts...... 132000....-.........-   [/b]

[b]Unsecured Debts[/b]

Description....................Debt......Monthly...APR

Loan Zopa......................15000.....328.......0

Loan Oplo......................3500......131.......0

Virgin CC......................1500......43........0

Sofa Creation..................2000......37........0

Monzo Flex.....................2113......300.......0

Argos..........................1544......40........0

Capital1 CC....................1460......84........0

Barclaycard CC.................400.......26........0

Aqua CC........................2200......120.......0

Fluid CC.......................3200......95........0[b]

Total unsecured debts..........32917.....1204......-  [/b]

[b]

Monthly Budget Summary[/b]

Total monthly income.................... 2,000

Expenses (including HP & secured debts). 1,942.31

Available for debt repayments........... 57.69

Monthly UNsecured debt repayments....... 1,204[b]

Amount short for making debt repayments. -1,146.31[/b]

[b]Personal Balance Sheet Summary[/b]

Total assets (things you own)........... 160,000

Total HP & Secured debt................. -132,000

Total Unsecured debt.................... -32,917[b]

Net Assets.............................. -4,917[/b]

[i]Created using the SOA calculator at www.LemonFool.co.uk.

Reproduced on Moneysavingexpert with permission, using other browser.[/i][/font]

Grumpelstiltskin

A couple of quick comments.

Are you claiming single person discount on your council tax?

Why are you paying your brother's phone bill?

fatbelly

Mortgage and rent are the most important things.

Non-priority debts can go to zero payment for a bit.

Review things again when you get back to your normal income

sourcrates

I agree with fatbelly, get the mortgage and rent arrears sorted out first, the rest of your unsecured borrowing is all non priority and should not be paid whilst you have essential debts to service.

Not paying your credit cards and loans will lead to a few snotty letters, and the odd phone call, not paying your mortgage and rent will potentially lose you your home.

You must get your priorities in the right order.

Wannabehousebuyer

Grumpelstiltskin said:

A couple of quick comments.

Are you claiming single person discount on your council tax?

Why are you paying your brother's phone bill?

yes 25% discount on CT is claimed 

brother is at uni and like all of us, the last 7 months has been tough so i said i would help out so he can work less hours, im upset i cant help him more.

Wannabehousebuyer

fatbelly said:

Mortgage and rent are the most important things.

Non-priority debts can go to zero payment for a bit.

Review things again when you get back to your normal income

sourcrates said:

I agree with fatbelly, get the mortgage and rent arrears sorted out first, the rest of your unsecured borrowing is all non priority and should not be paid whilst you have essential debts to service.

Not paying your credit cards and loans will lead to a few snotty letters, and the odd phone call, not paying your mortgage and rent will potentially lose you your home.

You must get your priorities in the right order.

will the missed payments not harm me further? I just do not want to get myself in a hole 
my mortagge i am paying extra 50 a month and rent agreed 50 per month so they are being chipped slowly.

but you think i should cancel all DD and try and do bigger chunks of rent and mortgage? 
sorry trying to get my head around it all

with the amount of creditors i have, i imagine my phone will not stop ringing, thats just so much stress. 

sourcrates

Debt is split into two categories -

Essential debt - mortgage/rent/utilities/council tax/food etc
Non essential debt - everything else basically.

The worst that can happen if you don`t pay your non essential debt is a court order for an affordable amount each month according to your disposable income.

Non payment of essential debt can lead to bailiffs, charging orders, and ultimately repossession, so do you see where I`m going with this.

We have legislation known as the "General Data protection Regulations" (GDPR) this allows you to tell creditors how you wish to be contacted, so you ask for all contact by letter only.

Re-mortgaging with your current lender does not require a credit check, with a new lender it would.

So it makes sense to secure your borders first, by getting your essentials up to date, then, you can tackle the unsecured stuff, in the full knowledge your home is safe.

Do you not agree that is a much more sensible strategy ?

fatbelly

Wannabehousebuyer said:

will the missed payments not harm me further? I just do not want to get myself in a hole 
my mortagge i am paying extra 50 a month and rent agreed 50 per month so they are being chipped slowly.

but you think i should cancel all DD and try and do bigger chunks of rent and mortgage? 
sorry trying to get my head around it all

with the amount of creditors i have, i imagine my phone will not stop ringing, thats just so much stress. 

Mortgage................................ 650

Secured/HP loan repayments.............. 0

Rent.................................... 454

Do these figures include the extra 50 to each?

You soa as it stands is very tight so even if you cancelled all payments to the non-priorities, you would have very little to pay extra to rent/mortgage.

You also said 'gas and electric is about 400 in arrears as well as about 200 on my water. ' That doesn't appear on your soa. Arguably, gas/electric are also priority debts

TheAble

I'd concur with the others that your mortgage and rent are top priority and should be brought up to date as soon as possible. Fall behind on that stuff and in the worst case you could lose your home.

You should have some buildings insurance in place btw if you don't already.

theoretica

I am sorry for your loss - really hard dealing with things on top of each other.

A few thoughts - firstly, being honest with yourself do you know exactly how you got into that debt? Because 33k over 15 months seems likely more than just lost commission payments, unless they were huge.

How large is your property?  Could you take in a lodger for a while to get out of the mortgage and rent backlog?

Why do you have life insurance?  For whose benefit? 

You can get a cheap washing machine for maybe £200 - why is it worth paying £9 a month breakdown cover rather than putting that into emergency savings where it could be used for any appliance that dies?

No buildings insurance?  I am not sure about shared ownership, is this correct?  My mortgage requires me to have this.

RAS

In addition to sourcrate's and fatbelly's excellent advice:

At present you are getting AP markers on your credit record every month, which isn't making your any more attractive than someone with defaults.

The problem is that the interest is probably still racking up and at 30% APR that's not good.

If you stop paying and get defaults, interest should be halted, so everything you pay (in the future) reduces your debt.

You've barely got enough to cover your essentials, so you need to stop paying non-essential ASAP, and to cut back to repay your essential debts  before SHTF.

That means bye bye to the satellite/cable deal and reduce the food costs. You haven't got anything for clothing but in future it's knickers and socks only.

Ask little bro to pay half the phone until he gets work this summer. Both of you need to look at when the contract ends and replace it by SIM only. 

I'd argue that the washing machine and gas cover would be better put into an emergency fund that you stash into a separate account for emergencies. It's more flexible. How old is the boiler?