In trouble :(

[supafish]

Today after weeks of progressively worse sleep I have finally got my dh to understand what a mess we are in financially . We have had2 years of terrible health problems and fell between the gap and were unable to claim any form of benefit . Thankfully we are both now working again but two years of no money have left us on our knees. We no longer earn enough to live , and have used cc constantly just to get by. My house has been on the market for 6 months and has equity in it but I fear because we can no longer afford the mortgage we are gonna loose it soon. I feel so defeated , I can understand how people top themselves when this happens ...... Help please x

Please don't say that :(
Things may seem insurmountable but you can and will get through this.
Do you have family who could help you financially for a while ? Of course asking is hard but they would hate to think of you struggling so much.

Oh supafish, first of all and from me. Sounds like a rough couple of years. Really pleased to hear health has improved, that is the most vital thing.

There may be many things you could do to improve things.

First of all, are you currently paying back interest-only or capital? Switching to interest only may reduce payments. Have you missed any payments and if so how many?

Credit cards - are you still paying minimum payments? Have you missed any? What is your total amount owing?

How big is the gap between your incomings and outgoings?

Any chance you could rent out your house & rent somewhere tiny for a year or so - do you have children?

CAB is a very good place to get advice.

Also many many people in or getting back out of similar situations over at Money Saving Expert - visit their debt free wannabe board for help and advice.

Thankyouboth !

We have tried to change mortgage, but because of our ages ( late 40s) and amount on mortgage there is nothing to change it too. They won't allow us to go on interest only . We are currently on a 3month break called controlled arrears but its not helped as money is still being swallowed. We haven't defaulted yet but it will happen next month :(

I am trying to pay the minimum on our cc but as I have to use them all the time to live the debt isn't getting any smaller.

We have a gap between in going and outgoing of about £800 on average every month .

I have 3 kids , one of 15 , one of 22 who are both living at home and another of 24 who lives away.

We are not extravagant people , no holidays for years , no new clothes and the odd bottle of wine !!!
Both my dh and I have had life threatening illness and although we are lucky to be here , the life we have now is so bleak :(

We both worked for 30 odd years , my dh self employed me in a variety of jobs whilst bringing up my family .

How on earth did we get into such a mess ????

Don't give up.

Depending on your income, an £800/month saving might be very achievable. My DH & I both lost our jobs a few years back within a very short space and we ended up living on much, much less than we were used to. We were desperate to weather it out and keep our house but the spreadsheets just didn't seem to add up.

However, we went over and over and over it and managed to get there. I thought we'd starve or at the very least go out of our minds with boredom, but it wasn't nearly as bad as I'd feared. You'd be surprised how little money you need for food if you plan carefully. I was shocked to discover how high my petrol bill was (we live in the middle of nowhere) and learnt when it was cheaper to order online and pay postage and to combine/avoid journeys and save money.

Is your 22 year old paying any rent?

Why don;t you conatact one of the debt charities - they can help negotiate repayments, get interest frozen etc etc. All free of charge. CAP Christians Against Poverty is one of them but I believe there are others out there.

Good idea Random

If you didn't have your credit card (and other unsecured debt) to pay, do you think you would be able to meet the mortgage and other essential living costs?

I believe (disclaimer: not completely certain!) that you are not at risk of losing your home if you fall behind with unsecured debt. I also believe that debt charities like the one Random mentioned can negotiate unsecured debt payments down to nearly nothing until you are in a better position to pay them.

Are you well enough to work and are there any skills you have gained working for the family business(es) that you could transfer to other employment?

My advice is get an appointment at CAB, prioritise paying mortgage before credit cards, and get onto money saving expert forum and do a full statement of account - list all your incomings and outgoings and someone will advise. There are many people who know how to cut back on there.

Get in touch with The national debt line or cscs, they will have loads of advice - i agree totally with those who say prioritise your mortgage. If you have not yet defaulted you are a million miles away from losing the house. It has to be quite bad before that happens and the bank has to work with you to try and sort things out. We were in a very similar situation to you, not with the life threatening illnesses, but i had MH issues and we ended up with debts +++. Do consider a debt management plan, the national debtline can advise re this, we have this and we are paying back about 15k in debts over 11 years. The problem we had was multiple creditors and it was truly unbearable. We use a company that doesn't charge for this service so everything we pay to them is used to distribute among our creditors. There is really so much that you can do - the first thing should be getting the interest stopped on your credit cards. This will mean you have defaulted and will affect your credit rating but if you owe a lot on your cards the interest will mean that if you make minimum payments you wont be paying hardly any of the balance off, just interest. The national debtline can advise on this.

Oh and an unsecured debt is very unlikely to result in the loss of your home.

Thanks again everyone .

Been off here for a bit cause was overwhelmed and kept crying .
Am defo goin to start sorting stuff out , have got an appointment at the cab, cut up the cc's in a rash moment - regretting it now.
Yes my 22 year old pays rent -not much cause bless her she hasn't got much!
Did a food audit and am only buying essentials this week, with dh wages today . Usually they get swallowed up but taking £40 to get what I can and that's it .
Tomorrow I'm goin to call the cc companies and the mortgage people again to try to get them to rethink whether they can do something with our present mortgage to help, if not we will try to get another . This is difficult because my dh is self employed and because he was ill for a year we don't have the required 3 years of accounts.
I'm realy trying to be more positive about this . I keep reminding myself that we are lucky to be here and some of the advice you lovely people have been offering has made me realise that it could get better . The first step is realising the problem .

I can't thank you mumsnetters enough , I don't feel so alone and terrified now . Also managed to sleep for 6 hours last night :) xx

glad you got a sleep!

you're not alone xx

If your house is on the market and has equity can you lower the price at all?

So sorry you are in this situation.

Hi I just wanted to tell you what happened to us. We had all credit pulled from us one afternoon in July and although it felt like the world had ended it was actually the best thing to ever happen to you. We did not pay any credit cards that month, worked out what we had coming in and what we would need to live on by using the debtboard on www.fool.co.uk and started living within our means. Once we knew what we would have left we offered this to the credit cards (we had 9 at the time) and they had to take it.
This is likely what the CAB will advise you do or even do it for you ie. contact your creditors. So basically what you need to do first is work out what you have coming in and then how you can live on that amount.
Dont get me wrong it has not all been plain sailing we have had reduced hours, reduced income, had to sell a car etc but we are slowly getting there and im sure you will too.
If you need any help in what figures we live on for each item ie. food, entertainment then just shout.
Love Redcrop x

The Dealing with Debt boards on Motley Fool and MSE are both fantastic, if anyone can b help you through this the people on those boards can.

What does unsecured debt mean?
Seems like you're getting excellent advice here OP.
Do you know of this blog? Extremely cheap poverty line meals which could help you, she uses Sainsburys basics for her recipes.
agirlcalledjack.com/

Unsecured debt is stuff like credit cards, secured debt is usually secured against your property, such as your mortgage.

I had a quick look at the Girl Called Jack page and it looks great. I am thinking of adding some sort of fundraising link to my Austerity Housekeeping blog page. I am wondering which charity I ought to link to. What do you all think?

BTW I thought I ought to link to the Crisis Diet on my blog as it's similar to Jack's concept (although hers might be a bit cheaper). I wrote the Crisis Diet series of posts after a request from MNetters about a year ago, and feedback on them seems to have been positive.

Crisis Diet

Another thing I would say is that if you get very hand to mouth, babysitting is the quickest and best way I know to earn emergency grocery money. And all of you in that house are old enough to do it.