Debt Problems need to solved

GOLDSMITH_2

Hi everyone, new to the site and wondered if I could get advice from the knowledgeable people on the site. My problem is as follows :

1. I have debts of £60,000 that include 2 loans plus various credit cards with monthly outgoings totaling £1800 of which £600 is for my parents mortgage ( 16 years 10 months left ) which was a council " Right to Buy " that passed it's 3 year term and became officially ours last December. We have a 5 year fixed with the Northern Rock at 4.99% until 2011.The house is worth approx £210,000 and we have £78,000 left to pay.

2. My monthly income is £2,300 not including overtime or bonuses.


3. I live with my wife in our house that is in her name .We have until December left on our fixed term mortgage. The rate was a very low 4.6%. We have approx £130,000 left and worth approx £250,000.

My question is :

1. Should I remortgage ?

2. Get a secured loan of approx £65,000 to cover my debts. I've been approved for a Northern Rock variable @ 9.69% at £662 /month. This would leave me with approx £ 1,000 per month, although this would still use part of my overdraft bank facility ?

3 Get a Debt Management Plan ?

4. Get an IVA ?

As you can see I've a problem that isn't going away and I need help !

kind regards

CCCS_Sarah

Hi Goldsmith,

There are a number of ways that you may choose to deal with your current situation. As a general rule they all need to include a financial statement (SOA) as the foundation from which to begin. Whist we cannot advise you fully on your situation via this forum we do have a free online advice facility called Debt Remedy where you can complete a financial statement and be provided with advice on the best way to deal with your situation. If you go click on this link it will take you directly to Debt Remedy.

With regards re mortgaging - it is rarely the best route to take as if you were to miss any/ offer reduced payments this will put your home at risk.

Once you have completed your financial statement if you post it up here and people will be along with some great hint’s and tips of how to save money. Is there any way you could look at increasing your income? Quidco, Overtime? Part Time Job? All things to have a think about

THE_LONE_RANGER_4

be very careful before you remotgage it could just be delaying what will come further down the line is all of it unsecured debt???, listen carefully to people on here especially the people who remortgaged to get out of debt im sure they will come along , i would try and sort it with out the remortgage and keep it unsecured etc you do need to post your soa

RAS

Please take very careful advice from a debt charitiy, like CCCS, before you do anything.

Please also be aware that if you do an IVA and it fails the only way out is bankruptcy, and that the fact that the house is in your wife's name may not prevent the OR from finding that you have a beneficial interest in the property and requiring you to make the equity over to your creditors. This could also affect your parent property.

Also be very careful about securing your debt against the property. It is rarely a good idea.

Once you have some impartial advice, put you SOA up here and we may be able to help you manage things more effectively.

gilligansyle

Just echoing previous advice really. If you go to CCCS website you can fill all the information online, and it will point you in various directions depending on the outcome. Or you could ring them direct. Definitely don't take out any further lending without taking advice. Thats how most of us got on here in the first place!

stevo2_2

What I would do is set up a Debt Management Plan with the aid of Payplan.

I did this and i was in your situation. It is hard to think of a way out but with thier help it is possible and could make you pay your debts off within 10 years without re-mortgaging or bankruptcy.

If you do decide to go into a DMP please beware of the following:

1. You will not get credit for the term of your DMP

2. You will most likely get Defaults on youe crdit history which lasts 6 years.

3. A creditor is very likely to take you to court to issue you with a CCJ although the court will most likely to stick with your offer of repayment.

4. Creditors are not obliged to stop charges or interest although Payplan do talk to them for you and try to stop this but I find it is possibe with symapthetic letters to the creditors from yourself.

All in all, i would go down the DMP route with Payplan, trust me it's worth it in the end.

Godd luck.