Unsustainable debt and long term relationship breakdown. Any advice welcome.

SpireCaptain

fatbelly said:

The big decision here is whether to sell the main house and split the equity or try to continue funding the mortgage while you find alternative accommodation.

The credit cards etc should not be a huge factor in that decision as they are nonpriority and can go without payment if needed.

However, you say 'till the kids all reach 18'. How many years is that?

Hi, thank you for your reply. Another name I see so frequently providing sage advice. 

The boys are 11 (senior school in September) and twins are 9 (year 4 so 2 years left at juniors) so looking at at least 9 years to keep them settled. 

At a push with help from my Mum potentially I could afford to rent a 4 bed but more than likely a 3 bed for £700-900 (if get a sofa bed so the boys had a room each now the twins don't share a room here) to make it more inviting to come and stay.

They all play cricket and rugby and have scouts so that's upwards of 3 nights a week and 1 or 2 days a weekend that my partner would either have to take them or I would continue. She has an older daughter with 3 young children who stay over at ours so she could do with the space here rather than a 3 bed she could afford with a mortgage at 52. She's applying for social housing on a new estate in village so close to schools but she's not high priority. 

SpireCaptain

I don't know how feasible it would be to maintain this level of debt I til the house is renovated and ready to sell and I either pay off dents or look at family mortgage or family BTL with me as Tenant and my Mum and Aunty on the mortgage with me and then enter a DMP to be able to afford child costs to my ex.

 I'd want 3 or 4 nights a week shared custody. Rather than seeing them every other weekend as I see so many at the school gates resort too. They are my world and the only thing that's kept me sane through these years living like lodgers with barely a word said. 

My partner took them away for a week in summer as I couldn't afford to come with them and then I couldn't work much as her daughter and 3 children had to have a chaperone (enforced by social services and the police) due to malicious unfounded allegations from her abusive ex so my working week was curtailed. 

fatbelly

9 years is a long time to kick the can down the road. If your youngest had been 15, that would be do-able

Don't think that you have to renovate the house pre-sale. It will have a value now and investing more into it may not provide a significant return. Obvs the devil's in the detail.

It sounds like you will be selling the house, getting a new situation and, when that is stable, look at options for your nonpriority debts

Smudgeismydog

BTL is valued at £100,000, with £63,000 outstanding mortgage 
Is the house big enough for you to move into? Or could you sell to release the equity?

SpireCaptain

Smudgeismydog said:

BTL is valued at £100,000, with £63,000 outstanding mortgage 
Is the house big enough for you to move into? Or could you sell to release the equity?

Thank you for replying. This is what my partner keeps suggesting to me. There is no off street parking for my van and pure water production for my window cleaning and it's in a neighbouring town to get the boys to school/playing out with their friends. 

 I'd like to sell it, ideally to the tenant as they have family opposite. I'm not sure if her finances and her age may be hindrance to a mortgage but she has an adult son and a partner in their own house so maybe possible. They've been in since 2015. 

If I sold it I could get credit card debts down somewhere manageable again but then renting would be more than the mortgage I pay now. So catch 22.

SpireCaptain

fatbelly said:

9 years is a long time to kick the can down the road. If your youngest had been 15, that would be do-able

Don't think that you have to renovate the house pre-sale. It will have a value now and investing more into it may not provide a significant return. Obvs the devil's in the detail.

It sounds like you will be selling the house, getting a new situation and, when that is stable, look at options for your nonpriority debts

I think you're right in that respect. There's still £25k in the kitty that my partner has in an account out of the £50k. We've got new windows in back two bedrooms, the others need to be replaced as over 30 years old and the kitchen is non existent. Maybe without a new kitchen but still with new windows we'd get 260k. Minus 112k mortgage would leave 148k. I think she put in 70 and myself 50 so split what's left. 

My partner won't have anymore inheritance or anything like that as no one is left, she does have a small pension.

I have no pension or savings. . My Mum is still alive and used Dad's money he left to buy more BTL to fund her care home costs as her parents were both in homes for a decade so she's worried of that happening to her. 

I think if we can sell up it gives me 9 more years to work out pension, savings after a debt management. She'd be 61 in 9 years and wouldn't get a mortgage then so perhaps fairer to give her chance to get a mortgage at 52 instead with 80k deposit.

RAS

Starting point re the shared house. Is this held as tenants in common or joint tenants? If you don't know download the deeds from the Land Registry, approx £7 and look for a form A restriction.

Any deed of trust in place?

SpireCaptain

In anticipation of needing to resort to a Self Managed DMP by the end of 2026 (after waiting for defaults and saving emergency fund) my current accounts are as follows. 

I practically live in business 1 overdraft and try and keep premier and Barclays current to zero as quick as direct debits come out. They've reduced my overdraft on current from £4000 down to £600 and Premier from £4000 to £2700 in 2025. 

Current Accounts

Barclays Premier 

£2700 overdraft limit

(Mortgage, EDF, car tax, O2 and Virgin Direct Debits)

Barclays Current 

£600 overdraft limit

(All credit card direct debits)

Barclays Business 1 

£2750 overdraft limit 

(Payments from vustomers- money transferred to Barclays accounts for direct debits)

Barclays Business 2 

£0 overdraft limit 

(Rent received in and BTL mortgage direct debit only)

Halifax Personal 

£1500 overdraft limit

(Council tax and water bill direct debits now set up rather than paying on credit cards)

Starling Personal 

£0 overdraft limit

No direct debits

Starling Business 

£0 overdraft limit 

No direct debits

SumUp Business 

£0 overdraft limit

No direct debits

I've never paid anything in or received anything from starling or SumUp to/from Barclays. 

Barclays Business 1 and Barclays Premier have paper trail to Halifax (payments in and out)

I will eventually get all customers to pay into Starling, likewise the direct debits manually moved across to Starling Personal. 

SpireCaptain

RAS said:

Starting point re the shared house. Is this held as tenants in common or joint tenants? If you don't know download the deeds from the Land Registry, approx £7 and look for a form A restriction.

Any deed of trust in place?

Thank you, I believe it's Tenants in Common as partner has an older daughter and grandchildren to leave to and I believe she contributed more. I'm trying to dig out the paperwork, I have land registry and invoice for a deed of trust from solicitors but can't find the actual paperwork. 

I'll keep looking as need it for a first free meeting with family solicitor on Thursday about this situation as they were also conveyancing firm we use. 

SpireCaptain

SpireCaptain said:

RAS said:

Starting point re the shared house. Is this held as tenants in common or joint tenants? If you don't know download the deeds from the Land Registry, approx £7 and look for a form A restriction.

Any deed of trust in place?

Thank you, I believe it's Tenants in Common as partner has an older daughter and grandchildren to leave to and I believe she contributed more. I'm trying to dig out the paperwork, I have land registry and invoice for a deed of trust from solicitors but can't find the actual paperwork. 

I'll keep looking as need it for a first free meeting with family solicitor on Thursday about this situation as they were also conveyancing firm we use. 

Looking on whatsapp from 2018 she mentions believe she put £75,000 and it was in a document  we had drawn up she says. I put either £52,500 or 62,500 down. Mortage for £130,000 so had £50k for renovations.