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Possible DMP or Default and Wait?

2

Comments

  • Cheeseontoast21
    Cheeseontoast21 Posts: 14 Forumite
    Third Anniversary 10 Posts
    edited 13 January at 12:53PM
    SOA below.

    [font=courier new][b]Statement of Affairs and Personal Balance Sheet[/b][b]

    Household Information[/b]
    Number of adults in household........... 2
    Number of children in household......... 0
    Number of cars owned.................... 1[b]

    Monthly Income Details[/b]
    Monthly income after tax................ 3000
    Partners monthly income after tax....... 0
    Benefits................................ 0
    Other income............................ 0[b]
    Total monthly income.................... 3000[/b][b]

    Monthly Expense Details[/b]
    Mortgage................................ 358
    Secured/HP loan repayments.............. 0
    Rent.................................... 0
    Management charge (leasehold property).. 0
    Council tax............................. 116.5
    Electricity............................. 31.59
    Gas..................................... 31.59
    Oil..................................... 0
    Water rates............................. 37.91
    Telephone (land line)................... 0
    Mobile phone............................ 15
    TV Licence.............................. 14.12
    Satellite/Cable TV...................... 31
    Internet Services....................... 31
    Groceries etc. ......................... 200
    Clothing................................ 10
    Petrol/diesel........................... 160
    Road tax................................ 16.25
    Car Insurance........................... 37.5
    Car maintenance (including MOT)......... 60
    Car parking............................. 0
    Other travel............................ 0
    Childcare/nursery....................... 0
    Other child related expenses............ 0
    Medical (prescriptions, dentist etc).... 0
    Pet insurance/vet bills................. 0
    Buildings insurance..................... 12.5
    Contents insurance...................... 12.5
    Life assurance ......................... 0
    Other insurance......................... 52
    Presents (birthday, christmas etc)...... 75
    Haircuts................................ 40
    Entertainment........................... 50
    Holiday................................. 0
    Emergency fund.......................... 50
    (Unnamed monthly expense)............... 0
    (Unnamed monthly expense)............... 0
    (Unnamed monthly expense)............... 0[b]
    Total monthly expenses.................. 1442.46[/b]
    [b]

    Assets[/b]
    Cash.................................... 0
    House value (Gross)..................... 180000
    Shares and bonds........................ 0
    Car(s).................................. 3000
    Other assets............................ 0[b]
    Total Assets............................ 183000[/b]
    [b]

    Secured & HP Debts[/b]
    Description....................Debt......Monthly...APR
    Mortgage...................... 111209...(358)......0[b]
    Total secured & HP debts...... 111209....-.........-   [/b]

    [b]Unsecured Debts[/b]
    Description....................Debt......Monthly...APR
    Barclaycard....................6450......176.......24
    Virgin Money CC 1..............8390......237.......23.29
    Virgin Money CC 2..............8064......235.......23.29
    NatWest Loan...................3708......376.......3.4
    Zopa Loan......................16051.....501.......13.2
    Tesco CC.......................9271......271.......26.5
    MBNA CC........................8824......395.......26.52[b]
    Total unsecured debts..........60758.....2191......-  [/b]

    [b]
    Monthly Budget Summary[/b]
    Total monthly income.................... 3,000
    Expenses (including HP & secured debts). 1,442.46
    Available for debt repayments........... 1,557.54
    Monthly UNsecured debt repayments....... 2,191[b]
    Amount short for making debt repayments. -633.46[/b]

    [b]Personal Balance Sheet Summary[/b]
    Total assets (things you own)........... 183,000
    Total HP & Secured debt................. -111,209
    Total Unsecured debt.................... -60,758[b]
    Net Assets.............................. 11,033[/b]

    [i]Created using the SOA calculator at www.LemonFool.co.uk.
    Reproduced on Moneysavingexpert with permission, using other browser.[/i][/font]
  • Cheeseontoast21
    Cheeseontoast21 Posts: 14 Forumite
    Third Anniversary 10 Posts
    Yes I have cancelled all direct debits. First one was due out today.

    Having done the SOA it confirms what I suspected. I was always £100 or so short but was staying on top of things by either going without or making some money on eBay or Vinted. But the Zopa loan repayment of £501 a month is not recoverable. 😢 
  • RAS
    RAS Posts: 35,300 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    Confused by your SOA.

    Your partner has no income, but some of the costs seem remarkably low, so are you only reporting a part of the cost.

    If so, what is your partner's income? If you earn the same then 50:50 is the correct split. If more or less, maybe that need adjusting?

    Out of interest what did you use the Zopa loan for? Consolidation?
    If you've have not made a mistake, you've made nothing
  • EssexHebridean
    EssexHebridean Posts: 24,349 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    I'd agree that there appears to be some holes in that SOA - this could be explained by you paying half the costs for various things but being uncomfortable sharing your partner's income. If this is the case then that's fine, but it's helpful to know as it makes things more understandable. For now though:

    Statement of Affairs and Personal Balance Sheet[/b][b]

    Household Information[/b]
    Number of adults in household........... 2
    Number of children in household......... 0
    Number of cars owned.................... 1[b]

    Monthly Income Details[/b]
    Monthly income after tax................ 3000
    Partners monthly income after tax....... 0
    Benefits................................ 0
    Other income............................ 0[b]
    Total monthly income.................... 3000[/b][b]

    Monthly Expense Details[/b]
    Mortgage................................ 358
    Secured/HP loan repayments.............. 0
    Rent.................................... 0
    Management charge (leasehold property).. 0
    Council tax............................. 116.5
    Electricity............................. 31.59 You need to make sure that energy billing is correct and up to date - if you have smart meters then check the last bills to make sure that the readings are looking about right, and if you still have traditional meters ensure that regular readings are given. 
    Gas..................................... 31.59
    Oil..................................... 0
    Water rates............................. 37.91 If this is 50% of the bill then you may be able to make a good saving by going onto a water meter. 
    Telephone (land line)................... 0
    Mobile phone............................ 15
    TV Licence.............................. 14.12 
    Satellite/Cable TV...................... 17
    Internet Services....................... 45 This is on the steep site if you are paying the full cost, and very expensive if you are covering 50%
    Groceries etc. ......................... 200 If this is 50% then there is probably some savings to be made - if this is the full cost then I strongly suspect if this is for two people you are underestimating your monthly spending in this area! 
    Clothing................................ 50 For now you need to cut this back to essentials only - a "socks and pants" budget, as it were! 
    Petrol/diesel........................... 160
    Road tax................................ 16.25 Just to check that you are accounting this monthly but not paying on monthly direct debit as that increases the cost? 
    Car Insurance........................... 37.5
    Car maintenance (including MOT)......... 41.67 You are clearly fairly high mileage looking at the fuel bill - are you confident this is sufficient to cover all annual costs other than insurance and tax? You need to think servicing, MoT test, tyres, screen wash, cleaning, wiper blades etc. Plus a "contingency" amount for unforseen issues.
    Car parking............................. 0
    Other travel............................ 0
    Childcare/nursery....................... 0
    Other child related expenses............ 0
    Medical (prescriptions, dentist etc).... 0
    Pet insurance/vet bills................. 0
    Buildings insurance..................... 12.5
    Contents insurance...................... 12.5
    Life assurance ......................... 0
    Other insurance......................... 52
    Presents (birthday, christmas etc)...... 75 This is pretty high for someone in debt - and for a family with no children in the household - I'd be looking to reduce this in your circumstances. 
    Haircuts................................ 40 Again, this might have to be reduced for a while at least - can you stretch appointments to longer in between, or change to a more low-maintenance style? 
    Entertainment........................... 50
    Holiday................................. 0 You never go away at all - not a weekend away visiting family, or a city-break with friends? Nothing at all? 
    Emergency fund.......................... 50 That's great that you budget for this - but you aren't showing any cash assets at all, so is this definitely being saved? If you budget for savings of this type but don't actually ringfence the money away to a savings account this just makes a bigger hole in the budget, so it's important to ensure that all savings of this type get made - ideally at the beginning of the month before they can get spent elsewhere! 
    (Unnamed monthly expense)............... 0
    (Unnamed monthly expense)............... 0
    (Unnamed monthly expense)............... 0[b]
    Total monthly expenses.................. 1464.13[/b]
    [b]

    Assets[/b]
    Cash.................................... 0
    House value (Gross)..................... 180000
    Shares and bonds........................ 0
    Car(s).................................. 3000
    Other assets............................ 0[b]
    Total Assets............................ 183000[/b]
    [b]

    Secured & HP Debts[/b]
    Description....................Debt......Monthly...APR
    Mortgage...................... 111209...(358)......0[b]
    Total secured & HP debts...... 111209....-.........-   [/b]

    [b]Unsecured Debts[/b]
    Description....................Debt......Monthly...APR
    Barclaycard....................6450......176.......0 Are these debts really all at 0%? I don't imagine the loans are for sure, so getting the APR's filled in where appropriate will be helpful.
    Virgin Money CC 1..............8390......237.......0
    Virgin Money CC 2..............8064......235.......0
    NatWest Loan...................3708......376.......0
    Zopa Loan......................16051.....501.......0
    Tesco CC.......................9271......271.......0
    MBNA CC........................8824......395.......0[b]
    Total unsecured debts..........60758.....2191......-  [/b]

    [b]
    Monthly Budget Summary[/b]
    Total monthly income.................... 3,000
    Expenses (including HP & secured debts). 1,464.13
    Available for debt repayments........... 1,535.87
    Monthly UNsecured debt repayments....... 2,191[b]
    Amount short for making debt repayments. -655.13[/b]

    [b]Personal Balance Sheet Summary[/b]
    Total assets (things you own)........... 183,000
    Total HP & Secured debt................. -111,209
    Total Unsecured debt.................... -60,758[b]
    Net Assets.............................. 11,033[/b]
    The key thing here is the shortfall - you can't afford to continue as you are - you are just making the situation worse each month, so you need to cancel payments to the credit cards immediately, and the loans just as soon as you have double checked that they are not secured (although I agree that it seems unlikely that they would be). Continuing with the payment as things are is completely unsustainable! 
    🎉 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 1/4/25
    SOA CALCULATOR (for DFW newbies): SOA Calculator
    she/her
  • Cheeseontoast21
    Cheeseontoast21 Posts: 14 Forumite
    Third Anniversary 10 Posts
    edited 13 January at 12:54PM
    Hi,

    Yes some costs are half as I share them with my partner. But we don’t have anything “jointly” so I didn’t think his income was relevant to the SOA.

    Energy billing is up to date.

    There are a couple of things I pay for solely - the water and the tv/internet as I earn slightly more than OH (which is £62 total and I just split it out as £17/45 for the SOA)

    £200 for groceries is half plus everything else - meals at work, a takeaway on pay day. 

    The £75 a month for birthdays and Christmas - Because of my situation I normally gift people something we can do together, so a day out for family or a weekend away for OH. I’ve always put these on credit cards because I haven’t had the money, so the £75 was what I think it will cost me without a credit card. Probably need to move some of it to holidays.

    The Zopa loan was for consolidation and I did pay off a chunk of my cards with it. But we got married last year with very short notice and the costs spiralled. My OH had savings to cover his half, I did not.

    None of my debt is 0%, so every month the minimum payments are paying very little off the balance. 

    I’ve updated my SOA above to reflect some of the feedback and also to add the APR against my debts.
  • RAS
    RAS Posts: 35,300 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    So can you confirm that if you stop paying your debts, you will have £1535 in the bank at the end of the month?
    If you've have not made a mistake, you've made nothing
  • Cheeseontoast21
    Cheeseontoast21 Posts: 14 Forumite
    Third Anniversary 10 Posts
    RAS said:
    So can you confirm that if you stop paying your debts, you will have £1535 in the bank at the end of the month?
    I was going to continue to pay off my NatWest loan, so I would be left with £1159. My plan was to save that whilst waiting for the defaults and then split it amongst the creditors in a self managed DMP.
  • RAS
    RAS Posts: 35,300 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    Cheeseontoast21 said:
    RAS said:
    So can you confirm that if you stop paying your debts, you will have £1535 in the bank at the end of the month?
    I was going to continue to pay off my NatWest loan, so I would be left with £1159. My plan was to save that whilst waiting for the defaults and then split it amongst the creditors in a self managed DMP.
    That's not really the question. Are you confident that you will have £1535 (or £1159) in the bank at the end of your pay month. That there is nothing missing?

    There are a lot of round figures that look like good guesses rather than precise sums based on the last 6 months statements.
    If you've have not made a mistake, you've made nothing
  • Cheeseontoast21
    Cheeseontoast21 Posts: 14 Forumite
    Third Anniversary 10 Posts
    RAS said:
    Cheeseontoast21 said:
    RAS said:
    So can you confirm that if you stop paying your debts, you will have £1535 in the bank at the end of the month?
    I was going to continue to pay off my NatWest loan, so I would be left with £1159. My plan was to save that whilst waiting for the defaults and then split it amongst the creditors in a self managed DMP.
    That's not really the question. Are you confident that you will have £1535 (or £1159) in the bank at the end of your pay month. That there is nothing missing?

    There are a lot of round figures that look like good guesses rather than precise sums based on the last 6 months statements.
    Oh ok, I see your point. 

    My SOA is my best guess at how I need to manage the budget, rather than fact based on the last 6 months because my previous habits are how I’ve ended up in this mess in the first place.

    i will spend some proper time tonight checking I’ve missed nothing.
  • RAS
    RAS Posts: 35,300 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    You've got a good point about prior behaviour. But if you are gong to cut back to a knickers, socks and shoes budget rather than funding Very and Next, you need to have an idea of what those will cost you in the next year, and divide by 12 for the monthly budget.
    If you've have not made a mistake, you've made nothing
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