In debt need advice please

curlyboy

Hello everyone

My and my partner own a home 5th year of mortgage- we owe £92,000 that includes additional borrowing ....

My fixed rate of 4.39 is up in Oct of this year
and the additional borrowing is on the svr at the moment at 6.16%
total includes both -£616 a month

My salary is £16k ( no including overtime )
my partners is £13k not including overtime

I owe £1,700 on my egg card ( minimum payment of 3% per month at 5.5% until easter then reverts to 16% i think

Im overdrawn with barclays ( £1200) I dont use the account just pay interest every month so increasing every month

Im overdrawn with Halifax ( £800 ) i dont use the account again interest everymonth is increasing that

My bank account I use HSBC which my wages go in I live in the overdraft of £1500......

I got £600 in savings in an isa
I got a claim for an accident out standing hopefully im looking at getting offered around £1500 in the next 6 months which will be a great help

My partner is due £2,300 payout in shares in may as well which is gonna help

Im struggling really

Out goings
mortgage - including additional borrowing - £616
Egg card - £40
Bus pass £40
Gym £32 ( tied in until Oct 08 )
Mobile phone £25 ( contract )
shares -£50 p/month - direct debit

also i do have loads of stuff to sell on ebay my panini sticker collection is worth £1200 shall i cut my losses and except £800 some1 offered

My dj equipment tons of rare records worth AROUND £1k

retrocomputers and games worth around £200

shalli sellevery thing to raise capital ??

Please advise me the best course of action im really worrying
#many thanks everyone

angelavdavis

Well, you have accounted for £778 per month, so where is the rest going? I suggest you keep a spending diary for a month or so to track your expenditure. It would also be better for you and OH if you do a joint SOA. What about food, insurances, going out, mobile phones, broadband, BT, water rates, electricity, gas etc do you pay toward these?

What interest rates are you paying for the overdrafts? If they are costing you more than you are making on the ISA, cash in the ISA and pay the majority off the higher rate overdraft and then put the share save scheme on hold for a few months and redirect the money into the overdrafts until you are straight.

The accident settlement is all well and good, but you can't necessarily rely on it to settle your debts, if you can cut back on stuff without too much pain and minimise the debts, then the settlement will be a bonus that you can potentially use to make up your ISA pot later.

By all means sell the items you mentioned if you think you can live without them and the debt is worrying you. To be honest, if you have roughly £200 per month unaccounted for, I would start here before selling your collections.

MaggieBear

A spending diary looks to be a good idea - if you've been using switch to pay for things rather than cash you could also start going back over things in the last couple of statements and see if you can account for what you've been spending.

It might be best if you do a full SOA for you and your partner - gas, electric, food, transport, xmas, clothes, etc - so we can take a look at it and see if there's anywhere you could make a regular saving (there almost always is).

Do you have an additional room you could let out? You can make (I think, someone correct me if I'm wrong, please!) and extra £370 a month from a lodger tax free if you do.

If you're really worried about the debts and there are somethings you can start to sell relatively painlessly, then definitely do. It can make you feel very pro-active, which helps that horrible feeling go down a bit.


In the meantime though, a full SOA would be most helpful

curlyboy

sorry my friend

I pay the mortgage my partner pays bills, petrol and food she is left with around £400 per month im left with around £200 pm..

Barclays I owe £1200 interest at 16%
Halifax I owe £800 interest at the same

if i cash in the isa i can pay off £300 off each or £600 off my egg card (£1800 at 5.5% until easter )
I didnt know i could sell stuff on this site ??????

thanks for the advice I agree the claim settlement will help I will 100% get something its a matter of how much ( wiplash )
What about my partners shares coming out in May for £2500
I cant expect her to settle all my debts with her hard earned shares can I

I also buy and sell a lot on ebay

My sticker collection is worth £1200
my records woerth £1k ( i dont use them any more really )
I can live without my panini collection if i cash in now i will loose out in a few years but i do need the cash really dont I

masterkay

You need to post a full SOA accounting for everything, phones. electric, tv, going out, food, council tax, christmas, birthdays etc to work out where the money is really going.

Ditch the ISA, use it to pay off whatever is the highest % unless the interest on your ODs are less than interest paid out.

You aren't in huge amounts of debt compared to some people so this is very manageable in my opinion.

My advice would be to post a full SOA and see exactly where you money is going, people here will most likely post back seeing where you can cut down. The aim is to live under what you take home and any extra throw at the debts starting with the one of the highest APRs.

As for selling the items, I would prioritise them and list which ones you'd be happy to sell first. I would look at your SOA and see if you can cut down and get by without selling everything. Consider selling everything else on ebay that is not nailed down before going for the collectors item. Worst case scenario you can sell everything and clear your debts. Can you use the DJ equipment to earn some extra cash?

I notice you only have one credit card and a few ODs. One thing you could consider would be getting a new credit card with a good 0% interest deal for purchases and spend on it instead of spending cash and put the cash to paying off the ODs. This can work for some people but you have to be very disciplined as you need to put the extra cash towards the debt and nothing else. This will only get you some time, maybe a year or but after shifting the debt to the 0% you can pay off the debt without having the interest charges. I think with your debts it could be achievable to pay off it all by the time a 0% deal runs out. There are cards you can BT to your account but I'm not sure about that so maybe someone else can post.

I'm not a big fan of saying open yourself up to more credit but it could be an option if you are disciplined.


Good luck

curlyboy

THANK YOU SIR/MADAM

yes i was thinking that I owe £1800 on egg ( £2k limit )
£800 overdrawn with halifax
£1200 with barclays

are u saying apply for another card pay off halifax and barclays and egg with the new c/c ??? at 0% how would i do that ??

and have all the debt on one card ?? sounds good - will i get 0% interest for 12mths >?? will buy me time with my claim and stuff to sell topay off that debt ??

Tesco offered me a £5k loan at £102 a month for 5 years i couldnt really afford it

My mortgage is up for review in Oct
so Do u think I should tie together my £69,000 mortgage and £23,000 additional borrowing together as a re mortage package from my present lender ( halifax )

Mortgage fixed at 4.39 = until Oct 08 ( £69,000 )
Additioanl borrowing £23,000 SVR @ 6.16

i could actually get a fixed rate tie the 2 together and possibly save couldnt I
as im paying 6.16 svr on my additional borrowing ????

I appreciate the swift replies

masterkay

curlyboy wrote: »

sorry my friend
My sticker collection is worth £1200
my records woerth £1k ( i dont use them any more really )
I can live without my panini collection if i cash in now i will loose out in a few years but i do need the cash really dont I

Sell your stickers and that will clear one OD
leaving you with 800 OD for halifax which 600 can be cleared by the ISA
leaving you with
200 OD with halifax
1500 OD with your own bank
1800 on your egg card.

This is all very manageable. I would make a start on cutting down each month and putting the money towards the debt.

The idea of getting a 0% card for purchases means that instead of paying cash for groceries, petrol anything you do that can be paid by credit card you do so thus putting your debt on the 0% card leaving you with extra money which you use to pay off your debt in this case because it is ODs the money just being in your account does it. Problem is you may be tempted to spend the money because it is there. This is why OD debt is sometimes harder. With a CC you can cut it up. So once you clear the OD maybe ask them to remove it.

Another way and probably a simpler way (now that I realise you egg deal is about to end) is to apply for a new card with a good BT facility and transfer the balance of your egg card. Before applying I would pay off what I said above as sometimes having too much existing debt may hurt your application and also getting a new card may tempt you into getting into it deeper.

Then work on reducing the ODs as fast as you can. Once you get rid of the ODs start paying back egg. Idea is that if you get a 12 month deal not only should you have your ODs paid off but also the card.

Be warned that CCs are not approving as many cards so you may not get a card so you need a back up plan which I think is sell as much as you can pay off as much as you can and get rid of the debt starting with the highest apr first

curlyboy

many thanks will keep you posted and when my claim comes through



will start selling asap

dancingfairy

Hi. I am a bit confused here:

Income £1200 a month?
Out goings
mortgage - including additional borrowing - £616
Egg card - £40
Bus pass £40
Gym £32 ( tied in until Oct 08 )
Mobile phone £25 ( contract )
shares -£50 p/month - direct debit

Barclays repayment ?
Egg repayment? is this the £40 above?
Halifax repayment?


So where is all the rest of your money going? what are the minimum repayments on the debts please?
I would get a full grasp of the situation before you start selling things as if you are spending too much you will be back to square one again. I feel you are grasping at straws at the moment with regards to selling things and need to have a long hard rational think about the situation before doing anything drastic.

You need to start a spening diary and record exactly what you are spending your money on.
You say you do a lot of buying and selling on ebay - do you have good records for this- are you actually making money? or is it being swallowed up and this is where the rest of your income is going?

Good Luck