Is My Situation Completely Hopeless?

cheexy

TheAble said:

There's the "Support for Mortgage Interest" scheme which I'm not sure if you may have seen already. Just thought I'd flag it up:

https://www.gov.uk/support-for-mortgage-interest

It's crucial to focus most of all on keeping a roof over your head. It might be an idea to speak to your mortgage lender to discuss your circumstances and see if they can offer any help over your monthly repayment.

Yes thank you 

Sly72

cheexy said:

Grumpelstiltskin said:

Benefits does that include Child Benefit?

Any chance of the baby's father paying anything?

Have you checked entitled to?

Yes it includes £96 monthly child benefit. Yes, I have checked entitled to but I can check again and there will be nothing from the baby's father.

Have you considered Child maintance if father is not paying?
I would stop Stepchange and wait until they all defaut, then either go back to Stepchnage or do self managed DMP.

enthusiasticsaver

As you don’t have enough income to cover your priority debts you will need to default on the cards. Speak to your mortgage lender to see how they can help you by maybe moving to interest only for a while. 

kimwp

It might be worth a post on the benefits board to see if there's anything else you might be entitled to.

PurpleMouse5

So you have priority debt (mortgage and hire purchase), and non-priority debt (credit cards). The credit cards are low priority because the consequences of not paying are much lower. 

I think you will need to prioritise the living expenses and the mortgage. The priority is not losing the house, and having enough to live on for you and the little one. It seems like there is some work to do to get a budget where you can meet those essential living expenses. People have talked about checking for any more benefits, and also researching whether the mortgage provider is able to offer anything such as a payment holiday or a move to interest-only payments during this time. 

I don't know what the hire purchase debt is for (a car?) - there might be a decision to make about whether you can keep paying that or if you should return the item (I think there are some specifics about how the most effective way to do that, that you should look into before doing anything). If you don't need to keep the item then this can become a low-priority debt too.  

It doesn't look like you will be able to make minimum payments on the unsecured credit. In your situation I would make token payments of £1 per month to each credit card. With the aim of getting onto a debt management plan when your situation improves a bit. "When can I offer £1 to a debt?" - FAQs about token payments · Debt Camel . 

Also in terms of your budget, I notice you have car maintenance costs but no insurance/tax/petrol - is this correct?   

2021rdsunshine

In my opinion you need to look at a few things: 
At the moment all your income is not enough to pay your mortgage so: 
1 - have you looked at your benefits entitlement and check if you are eligible for something else? 

2 - is your situation regarding income going to change in the next 6 months? Bearing in mind you have a little baby is an income from work a possibility in the very near future?
3 - according to your SOA your benefits are not covering your mortgage, how are you dealing with your living expenses like food and utilities? 

4 - you mentioned that you are on a breathing break with your unsecured creditors. Taking into account that your income is not enough for your living expenses, unsecured creditors are definitely not a priority at all and even if you want to do a DMP , you don’t have any spare money for it at the moment.
5- have you considered a DRO as a debt option for your unsecured debts ? Under the new law you can apply for it if your unsecured debts are under 50.000. Navigate the board to find information about it and all the implications involved. The value of your car might be an obstacle to this. 

I would definitely be thinking about what you can do to improve your income and allow to service your mortgage and living expenses. Definitely look at the benefits entitlement. 

Your situation is not hopeless, you just need a plan going forward . 

cheexy

2021rdsunshine said:

In my opinion you need to look at a few things: 
At the moment all your income is not enough to pay your mortgage so: 
1 - have you looked at your benefits entitlement and check if you are eligible for something else? 

I checked entitled to and nothing has changed 

2 - is your situation regarding income going to change in the next 6 months? Bearing in mind you have a little baby is an income from work a possibility in the very near future?

I'm thinking more towards the end of the year after baby has turned 1 as I'm all he has. That said, I am very open to doing some online work around baby now as I have so many transferrable skills, knowledge and experience from running a business for that long. I am a very hard worker and it is just unfortunate how everything happened. I really did my best to the point of shooting myself in the foot with the personal debt I incurred to keep the business running.
3 - according to your SOA your benefits are not covering your mortgage, how are you dealing with your living expenses like food and utilities? 

I have had help from family and friends so far.

4 - you mentioned that you are on a breathing break with your unsecured creditors. Taking into account that your income is not enough for your living expenses, unsecured creditors are definitely not a priority at all and even if you want to do a DMP , you don’t have any spare money for it at the moment.

Noted
5- have you considered a DRO as a debt option for your unsecured debts ? Under the new law you can apply for it if your unsecured debts are under 50.000. Navigate the board to find information about it and all the implications involved. The value of your car might be an obstacle to this. 

I will do this

I would definitely be thinking about what you can do to improve your income and allow to service your mortgage and living expenses. Definitely look at the benefits entitlement. 

Your situation is not hopeless, you just need a plan going forward 

I have included answers to some of your questions 

cheexy

Sly72 said:

cheexy said:

Grumpelstiltskin said:

Benefits does that include Child Benefit?

Any chance of the baby's father paying anything?

Have you checked entitled to?

Yes it includes £96 monthly child benefit. Yes, I have checked entitled to but I can check again and there will be nothing from the baby's father.

Have you considered Child maintance if father is not paying?
I would stop Stepchange and wait until they all defaut, then either go back to Stepchnage or do self managed DMP.

I'm just wondering if a default will not affect me when it is time to renew my mortgage in 3 years time. That is a real concern for me.

Grumpelstiltskin

If you stay with the same mortgage company you won't have a problem.

2021rdsunshine

Just wondering if you could benefit from help with your mortgage either through your mortgage provider or the link that was previously provided  https://www.gov.uk/support-for-mortgage-interest . This would give you a huge help to be able to free some of your income towards your living expenses until the time comes when you can look for a job once your little one is a bit older. In any case your priority is keeping a roof over yours and your child head and  be able to service your living expenses. Glad you are having some help from family and friends. 

As for the unsecured debt remember we are all just a reference number for the creditors. Circumstances in your life happened that lead you not being able to pay them back. It happened to me and to lots of people here. Keep strong, you will find a way forward!