Hello alec and welcome to the trust deed forum.

It sounds as though you have some equity in your home. Could you let us know approximately what it is worth and how much remains owing on your existing mortgage?
Could you also let us know whether you are the sole owner of the home?

If you could let us know we'll be able to work through the numbers and options in a little more detail for you.

I do hope that there will be an affordable way for you to affordably restructure your finances without having to resort to a serious measure such as a protected trust deed.

hi
thanks for reply.
i had a endownment morgage and the x got her pay of from the endownment,
the house is worth ?ú95,000 and the house was bought for ?ú41,000 and theres a 6k loan on this so ?ú47k and n rock want 54k to pay it off

i am in the process of getting it in my name only through the morgage lenders solicitor,
i am 41 years old

Hi alec.

I can see that the current situation isn't sustainable. Your expenditure is equal to your income even before taking into account costs like transport and food.

The equity in your home exceeds your unsecured debts so formal insolvency options such as bankruptcy or a protected trust deed seem inappropriate. They're a last resort and you could, if you wished, sell your home to repay your debts in full to avoid this.

You're asking about securing your unsecured debts against your home. The usual advice is that you should think about this carefully as, should you become unable to service your increased mortgage, your home would be at risk. However if the new mortgage is affordable you may well take the view that this is a risk you are comfortable with.

Using your numbers you appear to be in a position to afford either of the refinanced options that you mention and still have some surplus income over and above the needs mentioned/costed.

If you prefer not to secure the debts against your home you may wish to consider the debt arrangement scheme or a debt management plan to help you repay your unsecured debts at an affordable rate. DAS would protect you from any creditor legal action and ensure that no further interest were charged on your debts.

You appear to be in a position to repay the ?ú25000 that you owe in around six years or so if you went ahead with DAS (and still have your essential expenditure covered).

so should i take the cash to cover morgage only and enter in to a das ,and get help with my unsecured debts?

whast caah would i have left to myself? and how would that work if i needed items like clothes, household repairs ect?, is a iva anygood for me?

Whereabouts do you live alec? If you're resident in Scotland an IVA isn't an option open to you.

Is the purpose of the remortgage (without raising any extra funds) to ensure that the mortgage becomes in your name only?
It looks as though you might be paying a pretty hefty early-redemption penalty?

forgot to say, what payments would i be likely to repay on a das ?

yes im in scotland, the purpose of the morgage was to get property in my name and the old morgage ends in dec , the early redemption is 2k.

I did my sums based on the following numbers you provided:

Income: ?ú1140

Mortgage: ?ú230
Bills: ?ú270
Food/Housekeeping: ?ú120 (maybe a little low compared to usual guide)
Travel: ?ú140 (including a little extra to cover servicing)
Total = ?ú760

Surplus = ?ú380.

I think it might be sensible to increase the food/housekeeping budget a little and some allowance for clothing should be added.
This would appear to leave a surplus in the area of ?ú300 to ?ú350 perhaps.

The new mortgage payment amount reduces that range to ?ú230 to ?ú280 per month or so (which would extend the likely term of a DAS or debt management arrangement beyond the six years I mentioned previously).

Pinning down an exact figure for a DAS payment would require you to work through everything in a little more detail with a suitably qualified adviser but hopefully the information above is useful as some kind of a guide to how it might work for you. You are correct in saying that things like household repairs need to be considered also.

nothern rock who my existing morgage is with says i can gett the 230 till dec, then put me on to a higher rate at 7% or so, and cant change morgage with them without my x's sayso and house in both names .

i have the offer of more hrs at work but i do 5 days a wee 12 hrs a day, but dont wanyt to work my life away.
i had to use my credit card for car repairs on thursday as im in to my overdraught.
ive read reviews that dm companys charge a big fee for them selves and pay a small amount to debt, my morage will go through any day but i suppose wit the extrra cash they give me i can pay it back to the morgage but dunno if that will bring the payments down on the morgage then enter a plan.

if my bills are 270 (with no rises in utilities)
my morg is 300 (morg only)
thats 570 and will leave me with 530, i devided 2500 by 72 and woks out around 347 pm (without there fee) would take me to 877 -1140= 263 for food ect.

what ever way i look at it it feels like im living to work and not working to live.

on a dmp can i save cash to get things, do i need give up all luxuarys?

its a hard decision ive usually payed and just went without as i didnt wanna miss payments, was gonna call my biggest creditor at 14k and ask if i could get some kinna plan without interest or low interest.

would any recomend that i sell my car or home ?
how would that go with monthly orders i have coming of mmy credit card , would i need to stop them ?

Hi alec,

If your mortgage, for an increased amount, will go through in a few days I think you need to decide upon an option quickly. Once it's gone through you'll be carrying that mortgage debt for a while I would have thought unless there's the option to pay back big lump sums. I'm not sure there's any point in extending your mortgage if you're going to look towards a debt management plan or DAS.

With debt management you have two options. There are paid for plans with commercial providers. They should provide exact details of their fees in advance to you. There are also free-to-client providers such as CCCS that will take payment for running a debt management plan for you from your creditors rather than from your contributions.

Given the equity that exists in your home DAS may be a better option for you than a DMP anyway.

In both you'll agree a budget at the start to cover your costs. This budget is likely to be based upon the same sort of guidelines as a protected trust deed, which means your budget will be limited but set up to ensure that you have what you need. How you spend/save your money thereafter is a matter for you.

Neither DAS nor a DMP will require you to sell your home or car.

Selling your home to repay your unsecured debts would of course be one way to start afresh and it looks as though you'd be left with some money that could be used towards a deposit for another home in the future. The other benefit to this route is that you'd avoid the damaged credit rating that will happen if you go for DAS or a DMP.