£117,000 in debt.

purple_octopus

:eek:
Hi Again Everyone,
Here is my monthly income and expenditure list.

Income
Salary 2300
Partners contribution to expenses 239
Total income £2539


Expenses
Mortgage 647
Council Tax 91
Utilities 61
Home phone, mobiles, broadband 52
Food 220
Pet Food 40
Pet vaccinations 17
Home & buildings insurance 24
Car insurance 32
Car diesel 110
Car tax 14
Swimming 23
Magazines 3
Miscellaneous (inc clothes/beauty) 25
Total of living expenses £1359

Debt Repayments
First Plus Secured Loan 914
Unsecured bank Loan 392
Credit Card (minimum repayments) 365
Subtotal debt repayments £1671

Total expenses including debts £3030

Monthly deficit -£491



There are several things to note about the budget. My income can be £200-£300 higher some months due to overtime but I haven’t included it as it is not guaranteed. But neither have I included spending on birthdays, Christmas and holidays as I wanted to show the basics (I did work out the figures for these however, and the total monthly cost of these was about £88 per month!)

I am really shocked when I look at the overall budget. Even though I did one before, when I contacted CCCS, I don’t think I appreciated just how high the outgoings were.

nelly_2

Justa as a matter of interest, (because im trying to build up a picture of how and why people are getting into so much debt) did you do a budget check before you took on the loan/s?

andykolo

When i moved in with my girlfriend suddenly i found out that she had debts too although not like yours. So we when through everything that was spent over the next 3 months and that was a surprise .

After a bit of persuading i got her to part with her car mobile phone and things which cost money that we could do without sold alot of stuff both me and her.

Moved from nice rental property into a very cheap appartment, and downgraded everything from clothes to food shoes anything we we could buy cheaper we did. It took 2 years hard work to manage everything but finally we are in the position where we have money left at the end of the month rather than none

purple_octopus

Hi Nelly,
I didn't do a budget check when I took out the secured loan. I was unaware of the consequencesof such a loan. The biggest shock after borrowing £75K was to find out after only having it for several months that I now owed £89K.
I had never heard of MSE at that stage, I wish I had known...
My main problem was, I didn't talk to anyone at all in the years I built up the debt. My partner was the first person I told, very soon into our relationship.

purple_octopus

Hi Andykolo,
Your experience is very inspiring. I realise that some major downsizing of expenses is needed and if it were possible I would sell this house to release the equity to help pay the secured loan, and possibly go into rented. I need to check what the current repayment figure is for the first plus loan, as the figure I have quoted is from last year.
My income and expenditure list that was posted yesterday has highlighted some more expenses that need to be trimmed,specifically food and pet costs. It also made me realise I need to do more overtime.
My partner and I have both started selling things, via Ebay, Amazon Marketplace and Car Boot Sales. So far this year I have problably sold about £1000 of things such asclothes, dvds,cds, videos. There is a lot of stuff still to sell.
I'm glad to hear your situation has changed for the better after your hard work, good luck for the future

Purple O.

Spendalot_2

Can someone explain why you could owe 89k soon after taking out the loan, when it was only for 75K.

I have friends who have loan with same co, and they now owe 33% more than they borrowed six months ago. How can this be???

apprentice_tycoon

Hi purple octopus - it's tough but you've made a start by coming to MSE - I agree that your food bill seems high, and just for 2 of you?
Please take a look at the MSE Money Saving Old Style board there is such a lot of info and support there, look at the Indexes, there are lots of suggestions to help make savings, your food bill could be halved if you want it to be without resorting living off baked beans on toast

nelly_2

Spendalot wrote:

Can someone explain why you could owe 89k soon after taking out the loan, when it was only for 75K.

I have friends who have loan with same co, and they now owe 33% more than they borrowed six months ago. How can this be???

Its called interest thats how they make money

you borrow 100 quid @ 33% interest and you straight away owe 133 quid

CTT_2

Do a Clarrissa Wright and rid yourself of debt and go bankrupt. She has gone bankrupt about 3 times in the last 10 years and she is now a well known personality.
Why fret other such boring things as money when there is a life to be lived.
Go for it and bankrupt yourself.

Spendalot_2

nelly wrote:

Its called interest thats how they make money

you borrow 100 quid @ 33% interest and you straight away owe 133 quid

But surely if the interest always exceeds the repayments, then the loan would never be paid off. Does this company have a way of charging interest upfront or something.

Most lenders (eg egg) charge interest daily or monthly and the interest never exceeds the monthly repayments (or the loan would never be repaid)

What is Firstplus's method for calculating interest?