Separating, but have a lot of debt. Should we sell the house?

[Celery]

I'd really appreciate some advice as to what would be the best way forward here.

We have agreed to seperate, but are not sure what to do.

My husband works and earns a reasonably decent wage. I haven't worked for ten years, and we have three children under ten.

We have a £60,000 mortgage on a house that is worth £180,0000. We also have £30,000 credit card and loan debt. The monthly payments are signficantly eating into our monthly budget.

Without the debt, it would make sense for the children and I to stay in this house, whilst my husband rents elsewhere. However, we can't afford to do this.

Would it make sense to sell the house, pay off all of our debts, and each walk away about £40,000 each, to set up two seperate homes elsewhere?

My husband would do very well out of this deal. He could use the money as a deposit on a new mortgage.

I, however, haven't got a job, would have to rent, and having the £40,000 would mean I don't think I would be entitled to any benefits. So, I would be okay for a while, but would need to consider my future.

I do want to work, but I havent worked for ten years, have no relevant qualifications, and I would be the main child carer, so any work would have to fit around the children. Any job I get will be unskilled and low paid. I have no family nearby to help.

We really need to seperate, and we really want to clear of this debt, which is such a burden.

Can anybody please advice what would be the best way forward?

You really need to see a good financial advisor. It might be possible to restructure the debt.

You'll not be eligible for housing/council tax benefit with a sum of money over 16,000 pounds.

I think the way forward is first for you to get a job, tbh.

I think you should discuss with your husband (and a solicitor if necessary) about how the finances are split in the divorce. I think that selling your home, splitting the proceeds and setting up afresh sounds sensible rather than everyone trying to finance enormous debts. Your husband is still obliged to support his family even when you are divorced so you can either discuss a fair amount between yourselves or you could go the CSA route and let them work something out based on his disposable income.

I agree that getting back into the workplace sounds like an excellent idea. Check out what you would be entitled to in terms of tax credits and other benefits by using www.entitledto.com... you can do some 'what if' scenarios to reflect the difference between working and not working, for example. If your children are school-age, breakfast/after-school clubs and similar are not as expensive as you might think.

Good luck

You might be better to think about remortgaging wrt the debt, then waiting to sell until you have a secure job so your £40 can be spent on a deposit

Thank you everyone, for your replies.

We tried to remortgage, to pay off the debt, about six months ago, but were declined, due to the current climate I suppose.

With regards work, I have a good idea for a business I would like to set up, and working for myself makes sense in my situation, but I would need some of the £40k to fund it. I expect I will need to do some part time work in the mean time, cleaning or supermarket work.

If it's any reassurance, there's nothing to beat the feeling of getting out of a miserable relationship, being debt-free and independent... even if your eventual income or lifestyle is not quite what it used to be. :)

Make sure your husband pays a decent amount towards his/your children ... the arrangement I have with my son's father is that his monthly payment has to at least cover childcare costs. It hasn't been a bad benchmark so far.

Thank you Chil, I really appreciate your post.

We have the advantage of both wanting the same thing, and both able to communicate this to each other. And I know he will do the right thing regarding the children, both financially and in spending as much time as possible with them.