Hello

My partner and I have a total debts of about £80,000 (most of which were accrued – using credit cards and unsecured loans to pay our mortgage whilst we are unemployed for about 2 years between February 2005 & May 2007 – because we were declined welfare benefits).

We currently earned about £4100 (gross) / £3000 (net) per month (About £500 of this is not guaranteed income from moonlighting; working evenings & weekends).

Our mortgage repayment is about £1200 per month.

The minimum re-payment on all our debts (credit cards and loans) is about £1800 per months (of this, interest account for about £1250).

Our others outgoings (Gas, Electricity, Water, Council Tax, Insurance etc) is about £350 per months.

We have one child and between us we spend about £450 on food and travelling to and from work using credit cards as we usually have nothing left after paying all our bills. We have no social life, in fact most of our spare time are spend running around or working extra hours to ensure we do not default.

The remaining mortgage loan is about £115,000.00 and the value of our property is about £215,000.00.

The current rate of interest on our mortgage (up to October 2009) is 1.79% (tracker).

Please we will be grateful for your advice and information especially on getting interest rate on our Unsecured Debts (credit cards and loans) reduce.

For more information please see – statement of affairs below.

Thank you.



Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 1
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 1450
Partners monthly income after tax....... 950
Benefits................................ 50
Other income............................ 150
Total monthly income.................... 2600

Monthly Expense Details
Mortgage................................ 1200
Secured loan repayments................. 450
Hire Purchase (HP) repayments........... 50
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 125
Electricity............................. 35
Gas..................................... 50
Oil..................................... 0
Water rates............................. 25
Telephone (land line)................... 50
Mobile phone............................ 25
TV Licence.............................. 15
Satellite/Cable TV...................... 15
Internet Services....................... 0
Groceries etc. ......................... 250
Clothing................................ 0
Petrol/diesel........................... 0
Road tax................................ 15
Car Insurance........................... 125
Car maintenance (including MOT)......... 50
Car parking............................. 25
Other travel............................ 25
Childcare/nursery....................... 0
Other child related expenses............ 50
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 25
Contents insurance...................... 20
Life assurance ......................... 50
Other insurance......................... 0
Presents (birthday, christmas etc)...... 0
Haircuts................................ 0
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 55
MISC.................................... 150
Total monthly expenses.................. 2880


Assets
Cash.................................... 0
House value (Gross)..................... 220000
Shares and bonds........................ 0
Car(s).................................. 2000
Other assets............................ 0
Total Assets............................ 222000


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 106000...(1200).....0
Secured Debt.................. 0........(450)......0
Hire Purchase (HP) debt ...... 0........(50).......0
Total secured & HP debts...... 106000....-.........-  

Unsecured Debts
Description....................Debt......Monthly...APR
AF.............................52500.....1550......0
VR.............................27500.....775.......0
Total unsecured debts..........80000.....2325......-  


Monthly Budget Summary
Total monthly income.................... 2,600
Expenses (including HP & secured debts). 2,880
Available for debt repayments........... -280
Monthly UNsecured debt repayments....... 2,325
Amount short for making debt repayments. -2,605

Personal Balance Sheet Summary
Total assets (things you own)........... 222,000
Total HP & Secured debt................. -106,000
Total Unsecured debt.................... -80,000
Net Assets.............................. 36,000

Hi

Many thanks for your response.

Below is re-evaluated statement of affairs.


Statement of Affairs & Personal Balance Sheet
Summary
Monthly Budget Summary      Amount(£)
Total monthly income      2,600
Monthly expenses (incl. HP & secured loans)      2,445
Available for debt repayments      155
UNsecured debt repayments      1,975
Amount short for making debt repayments      -1,820
Personal Balance Sheet Summary      Amount(£)
Total Assets (things you own)      225,000
Total Secured & HP Debt      -105,500
Total Unsecured Debt      -79,000
Net Assets      40,500
Household Information
Number of adults in household      2
Number of children in household      1
Number of cars owned      1
Income, Expense, Debt & Asset Details
Income      Amount(£)
Monthly income after tax      1450
Partners monthly income      950
Benefits      50
Other income      150
Total monthly income      2600
Expenses      Amount(£)
Mortgage      1200
Secured loan payments      0
Hire Purchase (HP) payments      0
Rent      0
Management charge (leasehold property)      0
Council tax      105
Electricity      30
Gas      50
Oil      0
Water Rates      25
Telephone (land line)      40
Mobile phone      25
TV Licence      15
Satellite/Cable TV      25
Internet services      0
Groceries etc.      225
Clothing      0
Petrol/diesel      0
Road tax      25
Car Insurance      125
Car maintenance (including MOT)      50
Car Parking      20
Other travel      100
Childcare/nursery      0
Other child related expenses      50
Medical (prescriptions, dentists, opticians etc.)      0
Pet Insurance/Vet bills      0
Buildings Insurance      25
Contents Insurance      20
Life Assurance      50
Other Insurance      0
Presents (birthday, christmas etc.)      15
Haircuts      5
Entertainment      20
Holiday      50
Emergency Fund      50
MISC      100
Total monthly expenses      2445
Secured & HP Debt Description      Debt(£)      Monthly(£)      APR(%)
Mortgage      105500      (1200)      0
Secured & HP Debt totals      105500      -      -
Unsecured Debt Description      Debt(£)      Monthly(£)      APR(%)
AF      51500      1200      0
VR      27500      775      0
Unsecured Debt totals      79000      1975      -
Asset Description      Value (£)
Cash      2000
House Value (Gross)      220000
Shares and bonds      0
Car(s)      3000
Other assets (e.g. endowments, jewellery etc)      0
Total Assets      225000

I have the same concerns

Mobile phone      25
Satellite/Cable TV      25
Car Insurance      125
Car maintenance (including MOT)      50

thats a lot of money every month on stuff that sounds far too expensive. If you are out so much, you hardly need cable tv and if my car cost £1500  a year to insure (I suspect this is 2 cars - but still way too much) I would sell it and buy something cheaper - and more reliable than something that cost me £50 a month to maintain.

I currently own 2 luxury brand cars - my total insurance is £45 per month, and maintenance is £200 a year for 1 service ( bi annual)

My mortgage is similar to yours and the payments are £250 a month (interest only)