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Hi everyone,I'm a newbie. Have just spent ages reading the posts and can't believe how helpful and friendly you all are- hopefully you will be the same to me!
Have requested some advice from the IPs here, but wondered if anyone can advise me? Sorry, it will be a long read!!
We have a really complicated situation.
We moved in with my parents six years ago, after we got married. Were renting a one bed flat and wanted to get a house, but no mortgage available, so they very kindly offered to put their house in joint names with us, so we could get a mortgage to pay for an extension on their house. So far so good, until builders cost twice as much as planned, so we ended up taking out a loan to pay the difference. Since then, we have struggled, ending up with a much bigger mortgage and a huge unsecured debt of almost £46,000.
We can manage the mortgage payments, but are struggling to find any money to pay credit cards and loans. We have been juggling debts for so long, all our cards are maxed out, and the threatening calls and letters have started.
Our mortgage company has said we can go to interest only payments which will give us about £250 per month to pay our debts (current repayments should be £1000).
Any suggestions? Still have approx £115000 equity in house, but don't want to remortgage again and put my parents home at risk. Bankrupcy isn't really an option for the same reason, parents are in their 80's and it would finish them off.
What share of the equity in the property do you actually have? If I assume that you and your wife have a 50% share - then presumably you have equity of £57,500 which is more than your debts. If so, then an IVA is unlikely to be an option for you, given that you only owed £46,000 and are not therefore insolvent on an assets basis.
Given that your share of the equity would also be available to a Trustee in bankruptcy, you have said that this would not be an option either, which really leaves you with the route of Debt Management. I suggest that you contact a DMP provider to discuss setting up a pro-rata repayment plan for you, so that you can begin to reduce your repayments to a more affordable level. The downside of this type of solution is that you will continue with the repayments until the debts are paid off in full - which will be at least 15 years in your case, but if your circumstances improve in the meantime you can increase the payments to lower the repayment term, and also offer a lump sum should one become available. Hopefully your creditors will freeze interest and charges in the meantime.
morning spitfire
just wanted to welcome you to the forum.you are amongst friends
while we may not always be able to answer the hard stuff-we leave that to the pros i just wanted you to know that whenever you stressed,down or sad or need a chat somebody is always here to listen !
welcome to your new bunch of friends ![:)]
[:D]
Thanks for the welcomes,Melanie and Fergiedoggy, and advice- it's really appreciated!
Think we might be getting somewhere, have spoken to someone today (not sure if we can name people on here, but very helpful) who suggests a debt management plan to give us some breathing space for a couple of months. With our level of debt, it will take about 17 years [:0]!! to clear, so may look at increasing our mortgage and offering a lump sum to the creditors, think this is called a F & F IVA?
Hopefully they will accept this,not sure how much to try and pay back, anyone got any ideas? Ideally would like to pay back the full amount, but this would really increase our payments too much, and we don't want to start struggling again.
Obviously this isn't the best solution, but no numbers on the lottery tonight, so no quick fix for us! Still feel better just for starting to DO something instead of burying my head in the sand.
Thanks again!
