Serious Debt!!!

little-miss-little

Going to try not to ramble on so here's the jist of the story...

Me and Boyfriend, very happy, want to get a house eventually, both still living at home with parents
Boyfriend in serious amount of debt, he does realise, has confronted it etc etc, very ashamed (has posted on here a few times i think) and is trying his best to get rid of it but because of the amount things are hard and not looking good for when we come round to looking for a mortgage.
Problem being how much he owes:
1: Big Loan - £10600 remaining to pay off over 5 years
2: Credit Cards - £6700 remaining to pay off (has just transferred onto a 0% card)
3: Student Loan - £8300 remaining but isnt paying these off yet as his salary isnt up to the threshold
4:Car Loan - £3000 remaining to pay off over 3 years.

Its a scary amount of money when added up - £28600 in total he owes!!!! :eek:

He earns just £16000 a year which is nothing compared to how much he owes and he still has outgoings such as petrol, keep to mum, insurance etc.
We've sat down and drawn up a spreadsheet putting all his payments and outgoings into it and he's going to put his whole monthly salary onto his debts except for £100 which he'll need to live off.

I'm ok on the debt side of things, as i've never signed up to a credit card (and never intend too) and i have only just committed myseld to a small car loan so i have quite a lot of spare money at the end of a month but obviously i can't pay off his debts.

I do worry about him and i try to help where i can but theres is only so much i can do.
Has anyone got any advice on the best way he can get through this as he's 27 and does not want to still be living at home into his 30's???

Guess i did witter on in the end, any advice is much appreciated.

Thanks
Alex

g33za

depending on how close you are to him you could help him clear his debts (offering an interest free loan) if you have spare cash. that way once his debts are clear you can both look towards a mortgage. This way both of you could save money on the amount of interest you would be paying on the outstanding amount.

Why dont you get a credit card? get a 0% one and pay off your car loan and gradually pay the outstanding amount on the card for the remaining term etc. would be cheaper.

davels

Hi Alex,

Your in a scarily similar situation to myself - about 13 months ago. I had debts of about £35k and I'm only 22. Nobody's fault but my own, I'm lucky enough to work in a position that pays me well and rewards my effort... but its not easy to pay off £35k. The other difference is that I now have 2 small children (2 & 1).

I realised there was a problem when I started to not be able to afford minimum payments... thats when I invesitgated which depths of debt I was stuck in - I dont the most horrible thing in the world... totalled up my entire debt. Then totalled up my outgoings against my incomings... and realised I was spending about £300 a month more than I was earning.

So... based on this, I phoned PayPlan - they are brilliant. You speak to an adviser, list all your debts - they call you back after a couple of days with a proposal for debt management.. it's all completly free of charge. They don't patronise you or make you feel bad for it - just help.

I strongly suggest you get him to call PayPlan and explain your situation. I'm 100% sure they'll be able to help you - and make you feel a whole lot better about the situation.

My girlfriend has a small amount of debt and I try to help her with this too... if your boyfriend can demonstrate he is going to start taking the debts really seriously and making a huge step like this... then tell him you'll pay for a couple of nights out a month for the both of you... a nice dinner, cinema etc etc... it's not paying his debts off, but it's showing him that money is indeed the root to all evil yet even with all this debt you can still enjoy life.

-davels-

file_wizzard

g33za wrote:

depending on how close you are to him you could help him clear his debts (offering an interest free loan) .

for 28K !!!

You would have to be very close, and keep him that way ! , im all for shared responsibility within a relationship, but an agreement of that nature would end in tears im sure !

think you need to get full details of his I&E and work out how he can deal with the debt with your moral, if not financial support.

Also if you are looking to get a house together then these debts really should be cleared before that point as you both need to enter into that situation as debt free as you can be and on completely equal financial terms.

Additionally the only way to guarantee that he wont be living at home at 60 let alone 30 is to take responsibly for his own finances ( which I see he is doing so well done ;o) )


I think this is another prime example of how inadequate the current consumer credit laws and practices are in this country, how on earth can someone on annual salary of 16k be allowed to run up an unsecured debt of nearly 28k !!!

Anyway, you have both taken the first step, and I am sure that many others on here will be more than happy to help and advise as you work your way through this together

Good luck

northerngirl_2

If you go with payplan will this affect your credit rating when you are debt free(not that i will when i am debt free again)

black-saturn

I would strongly advise against you paying any debt off for him. You might be all loved up now but your both still young and it will take him a long time to pay you back. Believe me I did it, then we split up 9 years later and ended up about £4,000 worse off.

Is there any way he can cut down on his outgoings? Getting rid of mobile phone, using car less or better still getting rid of it :eek: . What about his parents? If they know about it do you think they could waiver his keep for a while so that he can pay it off the debt?

skintchick

davels wrote:

money is indeed the root to all evil
-davels-

Actually, the quote is: "The love of money is a root of all kinds of evil."

Lawbag_2

correct me if Im wrong, but the student loan thresh hold is £ 15,000?

homersimpson_3

We've sat down and drawn up a spreadsheet putting all his payments and outgoings into it and he's going to put his whole monthly salary onto his debts except for £100 which he'll need to live off.

post a list of all incomings and outgoings - the chances are someone will be able to save you some money which can be targeted. a fresh pair of eyes/perspective can often result in alternative solutions.

margaretclare

No - don't take on a loan to pay off his debts for him!!! I know that 'he's the one' etc etc - but other young people have thought the same and partner has disappeared into the sunset! And yes, I know that you *know* this doesn't apply to you, but it's far too risky.

Also - he needs to get out of debt before thinking of taking on another huge commitment, a mortgage. You'll both get masses of good advice here on how to deal with the debt first and foremost - put the house-buying project on hold until you're out of debt.

Aunty Margaret

little-miss-little

No, i'm not going to pay things off for him or even help with the debts at all - i know that is far too risky plus my parents just wouldn't let me. I only help in smaller ways like paying for meals when we go out - things like that but i do not pay any bills for him what so ever and he doesn't expect me or want me too.
We do need to sort things out somehow before we look at getting a mortage. He's thought about getting one huge loan and putting it all together over 10years to make his total payments smaller but this is prooving to be difficult. Not really sure what else we can do.