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Where to start? self-employed, debt, overwhelm
debtfreein2024
Posts: 5 Forumite
Hi.
I'll try and summarise things
- I'm 51, husband 62. Kid is 15, autistic/adhd and not in school.
- both self employed. His company has kept going since 08 crash but no rise in income. Cash flow problems have caused current crisis but to be honest, it's been due for a while.
- my new business is going ok - but needs another 6-12 months to really get profitable.
interest only mortgage - 4 years to go, nothing in place to pay it back. Currently more than 50% equity but nothing in local area would be available, plus disrupting kid would cause so much stress I'd have to stop work. She's already a hospital day patient 3 days a week and they are thinking of readmission.
overdraft - £4k.
A few commitments like work laptop, mobile phone etc.
I have dyscalculia and adhd/autism too but have forced myself to look at the monthly outgoings. They are about £4k - so we never get enough to actually pay off the overdraft or reduce the mortgage.
I've tried to switch to repayment a few times but they always said our income isn't enough or my husband is too old. Once I get the business going I should be able to pay a lot more towards it.
I can't talk to him about it because he is so fragile trying to keep the business afloat . We have had help from my parents to pay this month's mortgage, I've called my bank, and the mortgage people but there's not much they can do.
What am I missing - what can I do to turn this around?
I am trying to cut back every single thing I can think of. I'm so stressed - on top of my kids illness, my mother in law is terminal and we can't even afford the train to go see her.
On the outside it looks like we are doing well - but god I'm so tired of fighting. I just want to save my house and clear my debts.
I'll try and summarise things
- I'm 51, husband 62. Kid is 15, autistic/adhd and not in school.
- both self employed. His company has kept going since 08 crash but no rise in income. Cash flow problems have caused current crisis but to be honest, it's been due for a while.
- my new business is going ok - but needs another 6-12 months to really get profitable.
interest only mortgage - 4 years to go, nothing in place to pay it back. Currently more than 50% equity but nothing in local area would be available, plus disrupting kid would cause so much stress I'd have to stop work. She's already a hospital day patient 3 days a week and they are thinking of readmission.
overdraft - £4k.
A few commitments like work laptop, mobile phone etc.
I have dyscalculia and adhd/autism too but have forced myself to look at the monthly outgoings. They are about £4k - so we never get enough to actually pay off the overdraft or reduce the mortgage.
I've tried to switch to repayment a few times but they always said our income isn't enough or my husband is too old. Once I get the business going I should be able to pay a lot more towards it.
I can't talk to him about it because he is so fragile trying to keep the business afloat . We have had help from my parents to pay this month's mortgage, I've called my bank, and the mortgage people but there's not much they can do.
What am I missing - what can I do to turn this around?
I am trying to cut back every single thing I can think of. I'm so stressed - on top of my kids illness, my mother in law is terminal and we can't even afford the train to go see her.
On the outside it looks like we are doing well - but god I'm so tired of fighting. I just want to save my house and clear my debts.
0
Comments
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PS - I can't call step change because we are self employed. I have spent all morning on phones trying to call the companies we use for insurance etc but it takes ages - I know I just have to do it, but I've got limited time w my teen's needs etc. Also trying not to worry her more than I have to.0
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debtfreein2024 said:PS - I can't call step change because we are self employed. I have spent all morning on phones trying to call the companies we use for insurance etc but it takes ages - I know I just have to do it, but I've got limited time w my teen's needs etc. Also trying not to worry her more than I have to.Hi,
I’m sorry to hear what you’ve been going through. StepChange aren’t able to give advice to the self-employed, but we would recommend getting in touch with Business Debtline who will be able to offer you specialist help.
https://www.businessdebtline.org/
Regards,
Aidan1 -
When you say 'clear my debts' do you have debts other than the overdraft and mortgage?
If so, it would help if you could post a statement of affairs
https://www.lemonfool.co.uk/financecalculators/soa.php
It is not the end of the world to reach the end of the mortgage term
https://england.shelter.org.uk/professional_resources/news_and_updates/homeowners_rights_at_the_end_of_their_mortgage_term
As for the overdraft there are various strategies for lowering it and reducing its impact
https://www.moneysavingexpert.com/banking/cut-overdraft-costs/
1 -
Thanks - I've done the best I can with this SoA.
I'd add that the cars we have are both inherited (one is 12 years old, one is 14 and about to fail it's MOT, so I'd probably have to pay to scrap them).[font=courier new][b]Statement of Affairs and Personal Balance Sheet[/b][b]Household Information[/b]Number of adults in household........... 2Number of children in household......... 1Number of cars owned.................... 2[b]Monthly Income Details[/b]Monthly income after tax................ 750Partners monthly income after tax....... 2587Benefits................................ 400Other income............................ 0[b]Total monthly income.................... 3737[/b][b]Monthly Expense Details[/b]Mortgage................................ 1500Secured/HP loan repayments.............. 120Rent.................................... 0Management charge (leasehold property).. 0Council tax............................. 280Electricity............................. 100Gas..................................... 85Oil..................................... 85Water rates............................. 0Telephone (land line)................... 70Mobile phone............................ 20TV Licence.............................. 13Satellite/Cable TV...................... 10Internet Services....................... 53Groceries etc. ......................... 500Clothing................................ 30Petrol/diesel........................... 50Road tax................................ 15Car Insurance........................... 64Car maintenance (including MOT)......... 25Car parking............................. 0Other travel............................ 0Childcare/nursery....................... 0Other child related expenses............ 0Medical (prescriptions, dentist etc).... 65Pet insurance/vet bills................. 85Buildings insurance..................... 80Contents insurance...................... 75Life assurance ......................... 80Other insurance......................... 0Presents (birthday, christmas etc)...... 20Haircuts................................ 10Entertainment........................... 20Holiday................................. 0Emergency fund.......................... 0[b]Total monthly expenses.................. 3455[/b][b]Assets[/b]Cash.................................... 0House value (Gross)..................... 445000Shares and bonds........................ 0Car(s).................................. 0Other assets............................ 0[b]Total Assets............................ 445000[/b][b]Secured & HP Debts[/b]Description....................Debt......Monthly...APRMortgage...................... 234000...(1500).....2.5Hire Purchase (HP) debt ...... 2580.....(120)......0[b]Total secured & HP debts...... 236580....-.........- [/b][b]Unsecured Debts[/b]Description....................Debt......Monthly...APRcredit card 0%.................524.......15........0[b]Total unsecured debts..........524.......15........- [/b][b]Monthly Budget Summary[/b]Total monthly income.................... 3,737Expenses (including HP & secured debts). 3,455Available for debt repayments........... 282Monthly UNsecured debt repayments....... 15[b]Amount left after debt repayments....... 267[/b][b]Personal Balance Sheet Summary[/b]Total assets (things you own)........... 445,000Total HP & Secured debt................. -236,580Total Unsecured debt.................... -524[b]Net Assets.............................. 207,896[/b][i]Created using the SOA calculator at www.LemonFool.co.uk.Reproduced on Moneysavingexpert with permission, using other browser.[/i][/font]0 -
The difficulty with all the mortgage advice is that my husband is already 62. We have no savings, no pension, nothing except the house. Even if we sold today, we would not even afford a one bedroom flat without trying to get another mortgage. Neither of us have the nerves left to go through this again. I need to stay here and keep it for my daughter. She's not going to be able to work properly, who knows what her future holds. I know that's the same for lots of us here but really, she'll be on her own soon enough. She needs something to rely on and that should be a home.0
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Are you sure some of the figures in your SOA are correct?
Buildings and contents insurances for example.If you go down to the woods today you better not go alone.0 -
You haven't put your overdraft in as an unsecured debt nor the monthly fees & charges.
Have you told us about the HP? I thought you owned 2 cars.
Even a scrapper is worth £200-300 these days0 -
£235k mortgage at 2.5% interest only - I make the payment £489/month. How come £1500 - are there some arrears there?2
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Comments in bold above.debtfreein2024 said:Thanks - I've done the best I can with this SoA.
I'd add that the cars we have are both inherited (one is 12 years old, one is 14 and about to fail it's MOT, so I'd probably have to pay to scrap them).[font=courier new][b]Statement of Affairs and Personal Balance Sheet[/b][b]Household Information[/b]Number of adults in household........... 2Number of children in household......... 1Number of cars owned.................... 2[b]Monthly Income Details[/b]Monthly income after tax................ 750Partners monthly income after tax....... 2587Benefits................................ 400 Have you checked that this is everything you are entitled to?Other income............................ 0[b]Total monthly income.................... 3737[/b][b]Monthly Expense Details[/b]Mortgage................................ 1500Secured/HP loan repayments.............. 120 What does this relate to?Rent.................................... 0Management charge (leasehold property).. 0Council tax............................. 280 Is this paid over 10 months, or 12? If 10, then changing to paying over the full 12 months makes budgeting easier. If you are unable to make the change until next year now, then make sure you keep track of the two "free" months and pay those against debt.Electricity............................. 100Gas..................................... 85 This is a high spend on gas when you also have oil - what is the reason for having both?Oil..................................... 85Water rates............................. 0Telephone (land line)................... 70 Ouch - why on earth is this so high?!Mobile phone............................ 20TV Licence.............................. 13Satellite/Cable TV...................... 10Internet Services....................... 53 Also high - are you in a very rural area where options are severely limited?Groceries etc. ......................... 500 This is high for a family of 3. I appreciate you may have some increased expenses if your child has sensory issues but it's still well worth looking at.Clothing................................ 30Petrol/diesel........................... 50Road tax................................ 15Car Insurance........................... 64Car maintenance (including MOT)......... 25 Does this actually cover expenses on two fairly old cars? I would expect just the MOTs and servicing to be more than that per month, and that's without considering tyres and other consumables.Car parking............................. 0Other travel............................ 0Childcare/nursery....................... 0Other child related expenses............ 0Medical (prescriptions, dentist etc).... 65 Anything here that can be reduced - prescription prepayment certs for example?Pet insurance/vet bills................. 85Buildings insurance..................... 80 Good lord - where do you live, Buckingham Palace?! Even if the property has declarable issues like previous subsidence I's say that this is high.Contents insurance...................... 75 Also this - you HAVE to be able to do better than that, surely?Life assurance ......................... 80 Again - I assume you have shopped around for this and made sure it is good value, suitable for your needs (allowing for self-employment) and decent value for money?Other insurance......................... 0Presents (birthday, christmas etc)...... 20 Sure this is realistic?Haircuts................................ 10Entertainment........................... 20Holiday................................. 0Emergency fund.......................... 0 You need to start getting something in here[b]Total monthly expenses.................. 3455[/b][b]Assets[/b]Cash.................................... 0 This suggests that the money you are budgeting to save for presents, car maintenance etc isn't actually getting saved.House value (Gross)..................... 445000Shares and bonds........................ 0Car(s).................................. 0Other assets............................ 0[b]Total Assets............................ 445000[/b][b]Secured & HP Debts[/b]Description....................Debt......Monthly...APRMortgage...................... 234000...(1500).....2.5Hire Purchase (HP) debt ...... 2580.....(120)......0[b]Total secured & HP debts...... 236580....-.........- [/b][b]Unsecured Debts[/b]Description....................Debt......Monthly...APRcredit card 0%.................524.......15........0[b]Total unsecured debts..........524.......15........- [/b][b]Monthly Budget Summary[/b]Total monthly income.................... 3,737Expenses (including HP & secured debts). 3,455Available for debt repayments........... 282Monthly UNsecured debt repayments....... 15[b]Amount left after debt repayments....... 267 You've said that you don't have enough coming in to cover your outgoings - but this shows a surplus. That either means that frittering is occurring, or that the SOA isn't accurate. For context though, that surplus would see your CC cleared in 2 months... [/b][b]Personal Balance Sheet Summary[/b]Total assets (things you own)........... 445,000Total HP & Secured debt................. -236,580Total Unsecured debt.................... -524[b]Net Assets.............................. 207,896[/b][i]Created using the SOA calculator at www.LemonFool.co.uk.Reproduced on Moneysavingexpert with permission, using other browser.[/i][/font]
On the cars, you won't have to pay to scrap them - WBAC genuinely do - and with a bit of battling you can get them to drop their admin fee as well.🎉 MORTGAGE FREE (First time!) 30/09/2016 🎉 And now we go again…New mortgage taken 01/09/23 🏡
Balance as at 01/09/23 = £115,000.00 Balance as at 31/12/23 = £112,000.00
Balance as at 31/08/24 = £105,400.00 Balance as at 31/12/24 = £102,500.00
£100k barrier broken 1/4/25SOA CALCULATOR (for DFW newbies): SOA Calculatorshe/her1
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