Paying off No 27 - Back again and £34K in the red!

Throughmyfingers

Hello I am back again...

It's been awhile since I have been here so for those of you who were around then, I have paid debt down and built back up and I am trying (again) to face the music.  To those of you who are new I am a Single mum of 2 who works full time and lives miles beyond her means.  I should have cared way more than I have to be honest, some people lay awake at night worrying about debt and it just never seems to have really bothered me.  I think I have got very comfortable with the fact I earn what most would consider a very good wage and that I have been paying away every month whilst still enjoying the odd holiday or 2....but I have had a (hopefully long lived) wake up call!

I am purchasing my first home and due to complete 25/8 (I think this will slip into September) as I am now on my own, I am very proud that I am in a position to be doing this.  But its hit me very quickly how if I don't change my attitude to money that I am going to be paying this off for the rest of my life and how much more I am paying on the interest, which has had me revisit everything.....I will be trying to still enjoy life, make some little changes to the house but will be trying to really buckle down and a little more here and there to see how much quicker I can get all this cleared.

So scores on the doors £14,912.34 is the number, well the first of them at least.  This is how much I currently owe to Loans/CC - I have reduced my student loan down from around £18K to approx £7500 and bank of Mum & Dad is now £11,545.00....so £33,957. Way too big a number for me to consider right now!!! My SL whilst a debt does pay itself, and my parents whilst I do really want to start making some massive progress is interest only and I am currently paying £100 a month.   So £15K is what I will be focusing on!!

So action time!!! I have borrowed £66,400 for the mortgage and will be paying it back at 7.8% (whilst eye watering to some, still 10x better than my CC's!).  I have £3000 (approx) to pay on completion to my solicitor/broker (I know I know, but my credit is still not the best so felt this was my only option).  I am hoping to remortgage at a better rate ASAP.  I am still slightly nervous its all going to fall through and I won't get the mortgage but hopefully when this completes I will be saving £80 a month which I plan to use to overpay and hopefully reduce some of this term down.

I am banging on a little here, but there's the intro so I hope some of you will follow along to keep me accountable.  I am going to be trying to sell my whole life on Vinted along the way to declutter and make some overpayments on the CC's, get involved in some spend challenges and I will break down the numbers more along the way so you are more than welcome to give advise along the way!!  x x 

Smudgeismydog

Hello 👋👋

A new home for you and your children sounds like the perfect moment to get your budgeting under control and take control of your finances.
Do you think posting an SOA could be helpful in terms of understanding where your money goes? You could use the new mortgage figure and a ‘best guess’ on the new household utilities. 

A mortgage rate of 7.8% is eye watering, but a mortgage debt of £66,400 really doesn’t sound huge.
You’ve got this
x

Throughmyfingers

So here is to making a start....

I have listed 7 things on Vinted tonight, mainly the boys clothes but there is a lovely coat that would be perfect for someone going back to school and the rest are nike etc so I am hoping they will sell.

I have £185 to live on until payday on Friday - Ive got £100 in cash £50 in another account which I am going to try and put towards the solicitor pot and going to try and make the £35 stretch.  The irony is when I have very little to live on I can make it spread but when I have been paid it seems to just vanish so fingers crossed!

My current situation looks like this, my monthly payment is in the 2nd column, my O/S balance in the 3rd and my overall limit/initial balance is in the 4th......The interest/apr are sickening, I am not in a position to get any 0% transfers at the moment and are lot of them are very utilised (the last column). I have a Credit Union account with £560 in which I will likely be using to pay the solicitors, however I Intended to use for Christmas if not.  I totally get the savings when you have debt argument but the reality is that I am still going to to have to spend on these things so don't want to throw it all at the debt to end up using CCs again!

118 Loan	£                     165.00	£                       4,454.46	£    9,898.80	31.07%	45.00%
Vanquis	£                     238.00	£                       2,963.44	£    3,000.00	46.80%	98.78%
Cap 1	£                       15.00	£                            18.40	£       200.00	31.10%	9.20%
cap 1	£                       21.44	£                                  -	£       200.00	30.34%	0.00%
Aqua	£                       15.00	£                       1,157.53	£    2,450.00	34.35%	47.25%
Zable	£                     150.00	£                       2,296.58	£    2,600.00	38.40%	88.33%
fluid	£                     275.00	£                       4,022.53	£    4,400.00	45.84%	91.42%
		£                     14,912.94	£  22,748.80		65.55%

Throughmyfingers

Smudgeismydog said:

Hello 👋👋

A new home for you and your children sounds like the perfect moment to get your budgeting under control and take control of your finances.
Do you think posting an SOA could be helpful in terms of understanding where your money goes? You could use the new mortgage figure and a ‘best guess’ on the new household utilities. 

A mortgage rate of 7.8% is eye watering, but a mortgage debt of £66,400 really doesn’t sound huge.
You’ve got this
x

Hello and Thanks for popping by Yes once I get the spending under control it's a very good position for me to be in as the house is around £110K at the moment.  

Yes I am going to get it listed shortly, I have a budget on excel so I have a good idea as to what my outgoings are in terms of utilities/monthly planned which are currently at £1997 I then have £525 for Food the kids foodball clubs etc which leaves me around £400 spare. I usually have busfairs/dinners etc to pay so that can fluctuate but its the extra's which seem to evaporate ...so I have also downloaded Snoop to track the extra spends too!  

joedenise

You said in your first post that you will have £80 extra once you start paying the mortgage (presumably the difference between mortgage payment and rent).  I wouldn't use that to reduce your mortgage with the debts that you have.  You would be better to use it to reduce your debts.  Your mortgage will be your cheapest debt at 7.8%.

I would be using to to reduce the Vanquis and then Fluid debts as these are both very high interest rates.

Try putting your debts into the snowball calculator and you will be able to see which order you should be paying off your debts.  Link here:

https://www.lemonfool.co.uk/financecalculators/snowball-calculator.php

Good luck with getting yourself debt free.

Throughmyfingers

Hi @joedenise thanks for popping in   
Yes it is the difference between the two, totally agree its actually my cheapest my thinking was as I am capped at £3000 a year overpayment on the mortgage if I at least chip away something its going to be bringing that term down, otherwise in my first 5 years I haven't even paid £5k off.  I can then work at shovelling anything possible off the CCs with no limitations, as the mortgage is a 40 year term and I am 34 I will need to reduce it massively so don't want to wait X amount of years until I am debt free before I start working on it.  

Thanks for the link ill take a look later, I am working on the Vanquis balance currently as its the highest, which is even more frustrating as when I have been popping things on here and there this has been the go to  Now removed from apple pay!! TY x 

Sarahwithlove

I agree, pay the extra off your cards not your mortgage. Then once the debts are gone or going down your credit score will improve and give you more options for remortgage and credit card offers. Once your debts are gone you can then have more money available to repay to your mortgage. 

Throughmyfingers

Good morning, Vinted dropped off this morning so £10 crediting shortly, also needed to post my deeds back to the solicitor....£5.60 on postage and 80p for the envelope  so £28.60 left for the week!

Throughmyfingers

Sarahwithlove said:

I agree, pay the extra off your cards not your mortgage. Then once the debts are gone or going down your credit score will improve and give you more options for remortgage and credit card offers. Once your debts are gone you can then have more money available to repay to your mortgage. 

Thanks for the advice & popping in   

ellenvan

Following and supporting.
You can do it.
My best advice 
A- try cash on a day out, impossible to overspend.
B - keep a list online or paper of every single thing you spend. It's easy to forget the little things and they all add up.

Throughmyfingers

ellenvan said:

Following and supporting.
You can do it.
My best advice 
A- try cash on a day out, impossible to overspend.
B - keep a list online or paper of every single thing you spend. It's easy to forget the little things and they all add up.

Thanks I appreciate it, that is a good option when it's gone it's gone!! I am going to to remove Apple Pay from my phone it's all too easy to tap £ tap £ tap!!  The little things are most certainly one of my issues I am very impulsive I am going to give YNAB a download today as that really helped me previously with this!