On the brink of losing it all
Discussion
- PLEASE READ FULL THREAD BEFORE WRITING LONG, MASSIVELY HELPFUL REPLIES**
I'm using this username as my other is connected to my work so hopefully that's OK.
Just a note to start is that this is all self inflicted and no one is to blame except myself.
I have no one to talk to about this but need to get it out and ask for some advice as the best solution to sort my life out.
Some points to note:
I take home £4k a month
My mortgage is £1,550 a month
I have 3 years left on my fixed mortgage meaning I have to pay £17k on ERC.
I owe around £14k on credit cards
£10k on a personal loan
£9k on another loan
Council tax is £315 a month
£320 a month on a lease (ends in May next year)
£235 a month on a lease (ends February 2020)
Plus the normal family household bills.
I've removed all outgoings that don't drastically affect my family.
I had a good business that failed miserably due to borrowing money from the wrong people and had to payback £30k within a days notice that meant using credit cards and my savings which has put me in this situation and then the business just collapsed.
I am now working for a company for a very good salary but my outgoings are more than my income.
My house is worth circa £390k with a mortgage of £330k.
I am having to use my Amex card month in month out to survive on our daily spends and every month it just gets worse and worse. As this is all my fault, it makes me. Feel absolutely awful that we're in this position and I can't see through it.
I have 2 'disabled' kids and whilst we get help from the government, this doesn't cover anywhere near what they 'cost' every month.
I realise this is a long post but I honestly don't know what to do.
I sell the house, realistically pay off halfy debt and I'm not massively in a better position and realise I have no way of getting on the property ladder for a very long time or is bankruptcy even an option? It feels like that option is the worst but is it inevitable at this rate?
I have 2 kids I absolutely adore and an amazing wife but I can't go on like.this much longer as I can't sleep and I'm generally just depressed and have no energy at all and haven't done for god knows how long.
Edited by pibby on Friday 9th August 15:52
What interest rates are on the loans? Can you consolidate them into a better interest rate? If you are a firstdirect customer you can borrow £30k at 3.3% which would mean £400pm over 7 years.
Do you need both leased vehicles? Can you VT either of them?
Do you need both leased vehicles? Can you VT either of them?
Edited by WonkeyDonkey on Monday 5th August 22:13
Thanks noneed.
Loans are 6.9 and 3.9 so pretty good but both were around £15k each and realistically, I wouldn't get lower rates for a big loan due to my overall debt.
Neither vehicles can be VT'd as they're leases but the £315 a month one is still circa £1500 to cancel which I don't have.
Loans are 6.9 and 3.9 so pretty good but both were around £15k each and realistically, I wouldn't get lower rates for a big loan due to my overall debt.
Neither vehicles can be VT'd as they're leases but the £315 a month one is still circa £1500 to cancel which I don't have.
Consolidating the loans and credit card to one new loan on a longer term / lower interest rate might help out, as would ditching one or both of the leases if possible, are either PCP or straight contract hire?
Can you remortgage to a longer term with current lender which may mean you don't need to pay the etc?
All of the above could see you £1k better off per month.
Does your wife work? If not is she able to? Appreciate that may be difficult with disabled kids.
Can you remortgage to a longer term with current lender which may mean you don't need to pay the etc?
All of the above could see you £1k better off per month.
Does your wife work? If not is she able to? Appreciate that may be difficult with disabled kids.
Get brutal with slashing your outgoings and get honest with your wife. You’re not seeing straight because of the weight on your shoulders. This seems like a good opportunity for the whole family to pull together.
Any way of generating more income (spare room, wife working)?
Doesn’t seem too hard to clear up, debt wise you’re probably on a par with most!
Any way of generating more income (spare room, wife working)?
Doesn’t seem too hard to clear up, debt wise you’re probably on a par with most!
Well done getting this off your chest and seeking help. I’d recommend you contact the government set up Money Advice Service and get some professional debt advice. There are phone numbers and details at:
https://www.moneyadviceservice.org.uk/en/tools/deb...
They should be able to help you come to new arrangements with the institutions you owe money to, most likely a combination of writing some of it off and rescheduling the remaining payments to be more manageable.
Best of luck with getting it sorted.
https://www.moneyadviceservice.org.uk/en/tools/deb...
They should be able to help you come to new arrangements with the institutions you owe money to, most likely a combination of writing some of it off and rescheduling the remaining payments to be more manageable.
Best of luck with getting it sorted.
My wife definitely can't work sadly due to the kids and I'd never want to put her in that position even if it were an option as our kids are more important.
Mortgage wise is tricky as although I'm earning £4k a month, it's on a self employed basis so haven't been doing it long enough and having 3 years left I don't think allows me to re mortgage.
Mortgage wise is tricky as although I'm earning £4k a month, it's on a self employed basis so haven't been doing it long enough and having 3 years left I don't think allows me to re mortgage.
67Dino said:
Well done getting this off your chest and seeking help. I’d recommend you contact the government set up Money Advice Service and get some professional debt advice. There are phone numbers and details at:
https://www.moneyadviceservice.org.uk/en/tools/deb...
They should be able to help you come to new arrangements with the institutions you owe money to, most likely a combination of writing some of it off and rescheduling the remaining payments to be more manageable.
Best of luck with getting it sorted.
Is this pretty much the same as declaring myself bankrupt in regards to our future?https://www.moneyadviceservice.org.uk/en/tools/deb...
They should be able to help you come to new arrangements with the institutions you owe money to, most likely a combination of writing some of it off and rescheduling the remaining payments to be more manageable.
Best of luck with getting it sorted.
Couple of initial thoughts and questions.
In terms of your depression and lack of energy, have you visited the doctor and discussed your symptoms with them? Some medication which helps with anxiety and stress could be very helpful in the short term to allow you to see things more clearly.
Can you speak to your mortgage company and explain the situation, and ask to move to an interest-only or to a reduced payments arrangement for a short period of time while you find your feet? If they properly understand the seriousness of your situation, they are likely to try and help.
In terms of your depression and lack of energy, have you visited the doctor and discussed your symptoms with them? Some medication which helps with anxiety and stress could be very helpful in the short term to allow you to see things more clearly.
Can you speak to your mortgage company and explain the situation, and ask to move to an interest-only or to a reduced payments arrangement for a short period of time while you find your feet? If they properly understand the seriousness of your situation, they are likely to try and help.
EddieSteadyGo said:
Couple of initial thoughts and questions.
In terms of your depression and lack of energy, have you visited the doctor and discussed your symptoms with them? Some medication which helps with anxiety and stress could be very helpful in the short term to allow you to see things more clearly.
Can you speak to your mortgage company and explain the situation, and ask to move to an interest-only or to a reduced payments arrangement for a short period of time while you find your feet? If they properly understand the seriousness of your situation, they are likely to try and help.
Thanks for the advice but as my wife is on medication for anxiety (kids and other little things) it's just not something I could do.In terms of your depression and lack of energy, have you visited the doctor and discussed your symptoms with them? Some medication which helps with anxiety and stress could be very helpful in the short term to allow you to see things more clearly.
Can you speak to your mortgage company and explain the situation, and ask to move to an interest-only or to a reduced payments arrangement for a short period of time while you find your feet? If they properly understand the seriousness of your situation, they are likely to try and help.
Happy to be corrected but won't the mortgage company want proof of income, x amount of months accounts etc for self employed?
fesuvious said:
Contact mortgage company. You need to release the 20k ish to get you to 90% ltv. Ask then what deals are open to you.
You need to use that to get shot of the credit cards and the 9k.
Take the mortgage out over the maximum term you can.
That's step one.
Step two is cutting up those cards.
Step 3 is losing those daft leases and either having one lease cat and one cheap runaround or two cheaper cars. This may have to be achieved by refinancing the 10k loan into 20k.
At this point you're still up per month. However you must put money away to cover repairs etc on the cars. Be disciplined. Open an account, send it by standing order. Have the account in a separate bank or buil society.
Now, remember that cards are evil. Remind yourself.
If this has worked out you're better off each month. Priority is paying down that 20k.
So, after 12months take a 6month mortgage payment break and use it in full to take that loan down to @5k outstanding.
6ish months later it's gone.
2years from now you're @88% mortgaged based on current values but you're free of the s
t debt.
However you will have 2 old cars. So remember to look after them, if they've gone ok then that maintenance fund will be there to assist.
2years.
Great Post so thanks for that. You need to use that to get shot of the credit cards and the 9k.
Take the mortgage out over the maximum term you can.
That's step one.
Step two is cutting up those cards.
Step 3 is losing those daft leases and either having one lease cat and one cheap runaround or two cheaper cars. This may have to be achieved by refinancing the 10k loan into 20k.
At this point you're still up per month. However you must put money away to cover repairs etc on the cars. Be disciplined. Open an account, send it by standing order. Have the account in a separate bank or buil society.
Now, remember that cards are evil. Remind yourself.
If this has worked out you're better off each month. Priority is paying down that 20k.
So, after 12months take a 6month mortgage payment break and use it in full to take that loan down to @5k outstanding.
6ish months later it's gone.
2years from now you're @88% mortgaged based on current values but you're free of the s
t debt.However you will have 2 old cars. So remember to look after them, if they've gone ok then that maintenance fund will be there to assist.
2years.
As above, not sure the mortgage company will lend more money with being new to being self employed?
I'd love to get rid of the lease cars but I don't have the cash to pay the early cancellation fees.
pibby said:
67Dino said:
Well done getting this off your chest and seeking help. I’d recommend you contact the government set up Money Advice Service and get some professional debt advice. There are phone numbers and details at:
https://www.moneyadviceservice.org.uk/en/tools/deb...
They should be able to help you come to new arrangements with the institutions you owe money to, most likely a combination of writing some of it off and rescheduling the remaining payments to be more manageable.
Best of luck with getting it sorted.
Is this pretty much the same as declaring myself bankrupt in regards to our future?https://www.moneyadviceservice.org.uk/en/tools/deb...
They should be able to help you come to new arrangements with the institutions you owe money to, most likely a combination of writing some of it off and rescheduling the remaining payments to be more manageable.
Best of luck with getting it sorted.
That’s why you need professional advice, as there are a range of approaches and options. You may explore them and decide it’s better to tough it out, but a professional debt advisor will know best which aspects of your debt are most easily reframed.
Edited by 67Dino on Monday 5th August 22:35
pibby said:
Thanks for the advice but as my wife is on medication for anxiety (kids and other little things) it's just not something I could do.
Happy to be corrected but won't the mortgage company want proof of income, x amount of months accounts etc for self employed?
No point in being a hero with regard to medication. If you are not well, you need a doctor. Happy to be corrected but won't the mortgage company want proof of income, x amount of months accounts etc for self employed?
With your lender, I'm not talking about normal mortgage arrangements. I'm talking about explaining the seriousness of your situation and explaining you don't feel able to afford your mortgage repayments and that it is affecting your health.
In that situation, your lender will want to work with you to avoid making a difficult situation worse.
EddieSteadyGo said:
No point in being a hero with regard to medication. If you are not well, you need a doctor.
With your lender, I'm not talking about normal mortgage arrangements. I'm talking about explaining the seriousness of your situation and explaining you don't feel able to afford your mortgage repayments and that it is affecting your health.
In that situation, your lender will want to work with you to avoid making a difficult situation worse.
Oh I definitely don't feel like a hero. Can't even afford to take my kids on holiday when they really deserve it. With your lender, I'm not talking about normal mortgage arrangements. I'm talking about explaining the seriousness of your situation and explaining you don't feel able to afford your mortgage repayments and that it is affecting your health.
In that situation, your lender will want to work with you to avoid making a difficult situation worse.
I have always been the money parent while my wife looks after the kids so yes it's about pride but also because I'm not willing to put my family through what I'm going through.
pibby said:
Thanks.
I suppose I just need to pull my finger out and accept things are st.
You have a family you love, a decent level of equity in your home, and you earn an income which probably puts you in the top 2% of the population. Might not be the right thing to say but, objectively speaking, many have it much tougher.I suppose I just need to pull my finger out and accept things are s
t. You have though suffered a set-back. When a business fails it places a huge strain on your health as it triggers so many emotions - I know because a close member of my family has been through that situation.
Mate, that sounds pretty awful from a stress point of view, but really you're not in as bad a situation as many others. But if you lose the plot now your family is fked, so cry, go running, lift weights... whatever you need to do to hold it together (as long as it costs nothing: wasting money needs to stop entirely now!)
You need to talk to your wife, as you need her support to get yourself out of this before it gets reallly stty. Also, if she keeps spending normally because she doesn't realise the fidnancial position, nothing you do on your own can turn it around. No Friday takeaways, no spa days, no wine with dinner: you can't afford it and you can't live that way without her support.
I'll assume you have no family who could help as you haven't referenced that as an option, but if my girls needed bailing out I would do it in an instant. Maybe you have options there you haven't had the heart to ask yet?
Try reaching out to this guy: https://theescapeartist.me as he does one on one financial coaching and also try reading https://www.mrmoneymustache.com/ There are a few cases there where people have turned their lives around in the way you need to. You also need to go hardcore frugal: you're still spending too much and it needs to stop.
I take it ERC is Early Repayment Charge? That's the real pisser in this as otherwise it's simple: you need to sell up and buy a cheap house near enough to work that you can walk/cycle there. As it stands, maybe you need to take a chance and rent out your house to someone who can afford it and rent something cheaper yourself - that might free up £500 per month while staying on the property ladder and building your equity in the house. Ideally rent near enough to work to cycle or walk, if the housing is cheap enough there. Ok, it's likely a breach of your mortgage, but how would the bank find out if you re-direct your post etc? I've never done this so maybe it's harder than it sounds, but you need to consider all options.
If you're not an uber driver, barman, online tutor... whatever in your spare time you should consider that, or send the wife out to work when you're back to look after the kids. Cutting costs is only half the equation, more income would help too. Also, have you any assets you could sell? Watches, jewellery...?
Best of luck: living with this sort of stress is debilitating but once you get cash-flow positive and chipping away at that debt you will be feel in control and able to breathe freely again.
ked, so cry, go running, lift weights... whatever you need to do to hold it together (as long as it costs nothing: wasting money needs to stop entirely now!)You need to talk to your wife, as you need her support to get yourself out of this before it gets reallly s
tty. Also, if she keeps spending normally because she doesn't realise the fidnancial position, nothing you do on your own can turn it around. No Friday takeaways, no spa days, no wine with dinner: you can't afford it and you can't live that way without her support.I'll assume you have no family who could help as you haven't referenced that as an option, but if my girls needed bailing out I would do it in an instant. Maybe you have options there you haven't had the heart to ask yet?
Try reaching out to this guy: https://theescapeartist.me as he does one on one financial coaching and also try reading https://www.mrmoneymustache.com/ There are a few cases there where people have turned their lives around in the way you need to. You also need to go hardcore frugal: you're still spending too much and it needs to stop.
I take it ERC is Early Repayment Charge? That's the real pisser in this as otherwise it's simple: you need to sell up and buy a cheap house near enough to work that you can walk/cycle there. As it stands, maybe you need to take a chance and rent out your house to someone who can afford it and rent something cheaper yourself - that might free up £500 per month while staying on the property ladder and building your equity in the house. Ideally rent near enough to work to cycle or walk, if the housing is cheap enough there. Ok, it's likely a breach of your mortgage, but how would the bank find out if you re-direct your post etc? I've never done this so maybe it's harder than it sounds, but you need to consider all options.
If you're not an uber driver, barman, online tutor... whatever in your spare time you should consider that, or send the wife out to work when you're back to look after the kids. Cutting costs is only half the equation, more income would help too. Also, have you any assets you could sell? Watches, jewellery...?
Best of luck: living with this sort of stress is debilitating but once you get cash-flow positive and chipping away at that debt you will be feel in control and able to breathe freely again.
EddieSteadyGo said:
You have a family you love, a decent level of equity in your home, and you earn an income which probably puts you in the top 2% of the population. Might not be the right thing to say but, objectively speaking, many have it much tougher.
You have though suffered a set-back. When a business fails it places a huge strain on your health as it triggers so many emotions - I know because a close member of my family has been through that situation.
I have been debating whether to post this for ages purely because of that. You have though suffered a set-back. When a business fails it places a huge strain on your health as it triggers so many emotions - I know because a close member of my family has been through that situation.
I know £4k a month is a s
t load of money for one income and I'm very grateful to earn that but in my case, more money more problems.Used to earn less, have a £700 mortgage and never really worried about money and just lived a normal happy life.
Business went really well, got pursuaded to 'expand' and then it all went wrong.
Very sorry to read about this. I would go see Citizens Advice ASAP. They're very good at this sort of thing, and it's free. Be VERY wary of 'debt advice' companies, who are more interested in making money off you than helping you.
And, please, look after your mental health. It's far more important than your financial health.
And, please, look after your mental health. It's far more important than your financial health.
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