£20k of unexpected payments in 9 months... feel like I'm going under

[badmoneyluck]

New username as I feel so ashamed to be in this position.

I've had 9 months of back luck after bad luck which has completely depleted my finances. I was always known as being such a good responsible saver with loads of savings but I've had £20k of unexpected costs so far this year and I'm now absolutely ruined. I'm not on a high wage, about £35k per year before tax, and self-employed so no protection.

Maybe it's my fault somehow but it all feels like bad luck and bad timing.

I bought my first home just under 2 years ago. I had done so much saving I was in a position to be a cash buyer (I put in 50% of costs and a family member loaned me the other 50% which I am paying back monthly). I got the L3 survey like you're supposed to and it picked up nothing significant. I kept £20k back to ensure I had some savings and a bit of money to do cosmetic changes.

Then in January I had to get a new boiler as mine completely broke (approx £2k).. then even, worse water started coming through in almost every room in the house and it turned out the roof had been badly constructed but the surveyor hadn't picked it up. A whole new roof is needed and because of the attic conversion, which makes it more expensive, it's going to be £15k.

I've already been having constant sleepless nights about how to cover the cost. The work needs to be done asap because it's causing more and more damage internally. Then today I've had a sudden dental issue which is also going to cost £500+ The unexpected costs just keep coming. My anxiety around what costs are coming next is unbearable.

Much of the original £20k savings is gone because I spent some on the new kitchen before the boiler and roof issue came to light. I've found family members who are willing to lend me up to £10k which feels horrible but is essential. Even then though I will be left with £0 in savings (excluding my tax money which I have kept aside) and completely vulnerable to anything else happening. I'm self employed so if work dries up or if I'm unwell no money comes in which always made savings so much more important.

I'm just at a complete loss of what to do and terrified for the future. The surveyor accepts no responsibility so can't claim any more from them. It will take me forever to save the £20k again as my outgoings have increased so much with the house and I'm just terrified what's coming next.

I don't understand what I did to deserve this.

Not read full thread, but could you get a lodger in (if a room is up to it) to help pay some monthly costs?

You'll be ok OP. It feels scary, but that's how it goes sometimes. Ignore everyone faffing about the mortgage. Sometimes you can only get a ridiculously small amount on horrendous terms. We ended up buying our current house on 7 credit cards and a "car loan". It felt stressful, but we just regarded it as "the mortgage" and ended up paying it off quicker than a traditional mortgage so win/win for us. You have a mortgage already - it's a private mortgage instead of a bank mortgage and that is fine. You were sensible to hold £20k back - imagine the state you would be in now if you hadn't.

When income is variable it is reassuring to have a fat pot of savings to smooth the ride. And when you have to use it (which was the point of it in the first place) you can feel a bit naked and vulnerable not having it there in the back of your mind. But you built it up before and you will be very capable of building it up again.

Boiler is done, kitchen is done. The roof will be done. Borrow what you can (credit cards, overdraft). Tighten the belt, increase income where you can. Lodger, rent out the driveway, sell stuff, bank account switching bonuses - all these things. If you are feeling anxious about it all don't bury your head in the sand - action is the only antidote. Once you take control of the situation it will feel more manageable.

You are now a homeowner with 50% equity. You will be far more attractive to a bank!!! Definitely go back to a broker and look at if anything is available to you - even if you don't use it you'll know the option is there if another issue occurs and your desperate.
It would be better to get this cost over a long period with lower payments, then you can throw whatevers left at recouping your savings.

Also, you can have more than one mortgage on a property.

I agree with you that owning a house can be very stressful financially!
I have spent a lot of money on my house this month and it's gone on my credit card. Nothing else I can do. I'm a fairly high earner but life is expensive when you are paying for everything on your own.
I do actually have a lodger from spare room.com
She is lovely. She pays £650 per month. I need that money for expenses relating to my son though so that doesn't actually go towards the house but it could do in my situation or yours.
You can offer the room on a short term basis and I've always had lots of interest since I started renting out a room, which was only a year ago. If you don't charge very much eg £500 per month you will probably get someone that doesn't mind the repairs that haven't been done.

My friend lives in social housing so has more money to spend each month than I do as all repairs are included and her rent is about one third of the cost of my mortgage but I wouldn't swap situations because my house is mine at the end of the day. So I never have any money in the bank but I do have assets.

@badmoneyluck you need to take a breath here.

You're not financially ruined. You've had a run of things you needed to pay for which is totally normal. These things happen. You've just had to use the money that you were intending on keeping in savings or using for cosmetic changes to make your home habitable.

I get you. We had very similar when we moved in here. But it is what it is. You'll be able to slowing build up those savings again, and I would encourage you to get a mortgage when you can to legitimise that loan from a family member. It was nice of them to lend it to you but ultimately it sounds like for your own peace of mind an industry stress test on your income and outgoings would help. Plus, you can get a mortgage for half the property value, pay them back and have a bit left over as well (if you fit obviously).

But you need to calm down. Be objective. Many many homeowners do not have a £30k buffer even if they are self-employed. I have about £1k. I did have £20k...but I had to spend a lot of it on repairing my roof.

Are you always this mean?

And your post is an example of some of the really bloody rude posts about the OP on here!

OP you've done really well to cope with the last few years, caring for a terminally ill parent, saving and getting yourself out of insecure rental housing is a lot! The recent expenses are unforseen and unfortunate but once dealt with you'll have secure home in good repair. Then you can pay off debts and start saving. Your equity is great already!

Do check if your household insurance will pay to repair the water damage inside.

And yet you don’t state the decisions which were apparently so poor…

You know what, I’m going to stand up for myself against some of the nasty posters on here.

im in my 20s from a working class background and saved enough to cover half the costs of my first home outright.

I went to speak to a financial advisor at my bank before looking into buying and they said they’d never seen anyone my age who’d been so financially responsible with saving. I think that’s why I’m so upset to be in this place now. Financial responsibility was what I was known for! They confirmed even though id saved so much they couldn’t offer me a mortgage until I had 2 years of accounts. We got legal advice on the family loan and a legal agreement put in place.

I’ve been running a successful business for nearly 3 years alongside the challenges of caring daily for a terminally ill family member and not letting that affect relationships with clients.

WHAT HAVE YOU DONE? Other than criticise and offer no helpful advice to someone who’s struggling l.

* off.

I think most people have said you're doing really well so I wouldn't let it rile you. You're in a great position compared to many.

That you have the £20K in savings to spend on repairs is basically what it's for.

How have I gone beyond my means though? My friends have lower incomes and much larger monthly repayments.

And how would the mortgage lender have known about the repairs? They ask you to do a L3 survey (the most comprehensive one there is as far as I’m aware). And I did that.

@badmoneyluck they wouldn't have known about the repairs but their financial stress testing would have taken general wear and tear upgrades into account.

Look - as I said before - and it's even more pertinent now I know you're in your 20s - *your savings are there as a buffer and now you've needed to use that buffer. *Sure you could sell up, but you've been offered lots of other options. Chill, realise that spending savings isn't the end of the world, and move on from it.

OP, you've had lots of supportive replies and you've picked up on the couple of critical ones- neither of which even made sense! Why let it bother you? It's similar to your reaction to the original problem- a bit of bad luck yes, but pretty run of the mill adulting stuff. You're doing fine- most of the suggestions are to chill, and that's on an online forum where people are inclined to be far more critical than they would be in real life.

Thank you to everyone who posted suggestions and kind comments. It is appreciated. And has inspired me to try and think a little differently.

tbh I was so upset yesterday it may have felt like with each one I was just dismissing each suggestion with ‘but that won’t work because of X,Y,Z’ which I also hate when OPs do that on mumsnet. But tonight I am thinking more practically and taking pretty much every suggestion here into consideration. They all have pros and cons and barriers but I am writing them all down and weighing them up. So then there’s an actual plan not just a constant worry about how to deal with this.

I’ll be the first to admit I’m just not very emotionally resilient at the moment. Which I think is part of the problem. It feels like there hasn’t been time to grieve. The boiler thing happened late one night when I got home from the hospice. And then I immediately started getting roof quotes after the funeral and was hit with ‘you need a new roof and that’ll be £21k’, which until that point hadn’t even occurred to me as possibility because I trusted the survey and it’s a relatively new roof. And since then I’m still crying most days because I’ve lost my favourite person and in my head it’s followed by ‘oh god and I also need money from the roof!’ ‘Maybe I should take a little time off to grieve? Or get some therapy to get through this? Wait I can’t cos of the roof money!’

I really wish things weren’t as hard all in one go but I’ll try and see it as just a hard period of life that will pass.

Thank you for your kind thoughts. When I posted I really just needed somewhere to let this out as I haven’t confided in anyone in real life about how worried I am financially.

@badmoneyluck could you possibly give us a bit more info around the private mortgage? Does the family member have a charge registered against the property? How much so you owe them currently and how much are you paying a month?
I know you are against getting a mortgage but I work in mortgages and I'm pretty sure that a broker would be able to find a lender who would base lending on your latest years figures only.
You could borrow enough to fully repay this private mortgage and to do the works to the roof. Stretch it over a longer period to give you some space to build up your savings again

It sounds like you have been sensible, it's just bad luck.

I've remembered that when I bought my place I had to provide a letter from my parents. They 'loaned" me money but it will turn into a gift. It had to say that there was no interest and they wouldn't ask for it back until I sold the property. That kept the mortgage company comfortable.

Still worth looking into a mortgage as an option I guess but I think you are probably right.

Ignore the people sticking the boot in pointlessly.

With relation to a lodger, is your own bedroom dry? Could you move temporarily to one you couldn’t let out and grit your teeth til the roof is complete?

It’s coming up to winter so just get the roofer booked in and get it mended. I had a similar issue and was incredibly stressed and saved and saved while they did it - they did it in winter - and they sent the invoice about a month after they finished and I had JUST managed to cobble together the money. They will make it watertight first, then if we’re lucky there’ll be rain and wind and they’ll have to go and help people who’ve lost tiles and it’ll take much longer than they said but they’ll have pinned tarps down and made you watertight in the interim. I speak as someone who obsessed over the forecast and rushed round with saucepans, wincing.

No advice but you've done amazingly well and a achieved so much.

It's just bad luck. Really bloody bad luck. Terrible luck.
Nothing you've done. You couldn't have known. You made sound choices and were hit with terrible luck.

These things happen and are unprecedented.

Now how do you feel about the house itself besides the roof issue?

Unless you love the house, what I think I would do in your circumstances is use up savings to fix roof and replaster.

Then sell the house. Buy somewhere else. A new build or something.

I think theres been too much negativity with the house so far and you'd do well to get rid and start over with your savings.

But I am a little 'woo' about these things. 🤣

It's rubbish when this happens. If you can get by without getting a mortgage, I would, especially being self-employed. What field are you working in and would it be beneficial to go back into regular employment? It might give you the secure income that you need.