Stay or sell?

[BLACKTUESDAY1]

Our outgoings are way too high. Have got 8k on credit cards, 25k unsecured personal loan and 87k left on mortgage (100k equity). Just on debt and mortgage we pay 1400 per month on a 50k pa joint income. Thats without all other normal bills. Our gas/elec is 220, c tax 145, water 60 etc etc.We could sell, pay off debts and downsize getting a small mortgage giving us a monthly mortgage of approx 500 instead of 1400 which we pay at mo for mortgage and debt. We would be a lot better off but have a smaller house in a not so nice area. Current house is lovely and perfect for us. We could maybe remortgage and incorporate debt but would mean a larger mortgage than we have now. We keep going round in circles. No idea what to do for the best. Very scared of making a bad decision! Help!

So your outgoings are about £1850 pcm according to the above, but you have a joint income of over £4k pcm.

Tighten your belts a bit and stay where you are.

Itemise all of your spending and cut back on non essentials - pay off whatever charges most interest first.

I wouldnt move house, if you love your home and the area you love in I think you'll hate giving that up. Plus it costs to move home!

Is it just you and DH?, how big is your house?

I'd look at bills, £220pm gas & electric sounds very expensive.
Can you re-morgtage, £87k isnt a lot so you should have a good LTV ratio which will give you some really good APR %.
Can you shift your credit card to a 0% card so not paying more interest?
Whats the % rate on the loan and how long do you have left ...if its higher than mortgage % can you look at borrowing a secong mortgage to lower the payments?

Thanks for reply. Total outgoings are 2300 with food. Thats all essential ougoings (insurances, broadband, car tax, tv licence, petroletc.) That doesnt include car maintenance or clothes/shoes dental/medical. We have 2 teenagers who constantly need things. Just feels an uphill battle and that we will never pay the debt off. I suppose a lot of people feel the same and i know loads are worse off so I really shouldnt complain

Can you get a second income stream? Let out a room, become a film and television location, rent your drive are just a few ideas.

Thank you. Loan rate is 3%. We have 4 years to go on it. 2 credit cards are on 0%. DH credit rating is great, mine has a default so to remortgage we would need to do it in his name only but i'm on the deeds and current mortgage. Not sure how that would work. I cant get a 0% balance transfer cc for mine due to poor rating. No spare room to rent and I dont think anyone would rent our drive but some good ideas.

Extend your mortgage to cover the debts? Even if you have to add a couple of years to it, it’s surely better than moving to a worse him in a smaller area. Sounds like you’d still have a very decent chunk of equity. And you could always increase payments/reduce outstanding number of years once your teenagers have left home?

Have you tried being really strict on your spending? Our incoming is a little higher but our outgoings are also higher. I manage to save quite a bit a month by being really strict with myself. I leave enough in the current account to cover the bills for the month (including an allowance for petrol and the weekly shop) and save the rest into another account as soon as it comes in. That way, if I need to buy something or have a treat I can access it but it makes me feel like I’m losing something therefore I’m less likely to order that takeaway/buy that reduced jumper etc. If you can manage that you could pay more off your debt?

Personally if you love your house I’d try and cut back and pay off rather than move!

Agreatusername, you are doing better than us! I plan to pay chunks off debt but something always comes up. We dont buy anything nice for ourselves but try to not make dcs go without too much. Always something needs fixing on our (old) cars or something breaks at home

Stay where you are. Get debt advice - national debtline or Stepchange. And/or check out the MoneySavingExpert website for excellent advice on dealing with debts.

You should shop around for energy, your gas/electricity bill seems to be high. Ditto mortgage if you can remortgage.

Your income is a good one! Perhaps stop buying everything your teenagers want? Can they earn their own money by doing things for you?

And yes don't add to your stress by moving (that costs money you haven't got) Good luck.

Have you worked out the cost of selling & buying a new home - it's probably more than you think.

In your shoes I would stay, tighten your belts, if your teenagers want things - learn to say no or ask them to prioritise the things they want, eg they want a new phone, can they sell old phone/clothes etc on ebay.

I think you would be crazy to move to a smaller house in a worse area when you earn pretty good money - can you remortgage to a better deal or extend the term a few years?

Thank you all for replying and advice. We are now thinking along remortgaging rather than selling as we really do love our home. We would extend the term and consolidate. Would still have a good LTV so our monthly payments would be way more manageable. Only problem is my default. We would want to remove my name from the deeds and do the new remortgage in dh name alone (he earns enough to allow this). As we are married in the event of a split it'd be 50/50 anyway. Does anyone know if this will cause problems? Also can we get my name off while I'm still living here?if so does anyone know how?