How much debt are you actually in?

[TheWitchIsBack]

Not that I’m comparing or competing at all, but we’ve got a combined income of 95k (Possibly 97k as I’ve taken on a second job). We need to go back to our mortgage advisor this year to see what we’d get accepted on, but I know my partner is keen not to have too high a mortgage. We want to be able to have a good lifestyle rather than paying for an expensive home. Thx for replying x

Lenders will do between 4 and 6x your annual salary less your credit commitments. So if you have no credit commitments you could theoretically get £570k as a max but most lenders will sit around £427k.

Car finance £1500 (paying off early)
Credit card (£5k and no idea why/what I spent it on..can only blame being immature and stupid)
I've had payday loans before which I really worry about for when I come to get a mortgage..

Don’t panic about the payday loans, try to steer clear of them if you can. Plenty of lenders that will still consider you for a mortgage - try and use a broker when the time comes and be honest and upfront.

 

[Zanzi202]

I guess it helps when you're loaded and have three mortgage free houses....

Good for them, but they’re still generous and very understanding!

 

[Emzykins]

About 4.5k. Mainly credit cards and paypal credit, all taken out while on mat leave as a single mum when covid hit. Still struggling to pay them back now!

 

[HollaBallers]

A few ex's left me in the shit when it came to money (I was always the higher earner in the relationships) so I started my 30's in about £18k worth of debt and nothing to show for it. A happy, grown up relationship and 3 kids later and I now earn 1/4 of what I did but only owe £3800 through Step Change and £1400 on a credit card.
Card will be paid off this year and DMP is due to be completed Nov 2021 - honestly I'm counting down the payments!!

 

[erin182]

Why won't you just pay off that 100?

Just never got round to it Cancelled the card years ago and I never notice the £5 leaving my account sooo...

 

[Notothefakes]

I have my student loan but literally no idea how much it is. I worked part time since having my children do I stopped paying it back as I was under threshold. Went up to three days last year and started paying it back but fell pregnant and have reduced my days again when I go back in Feb so I doubt that will ever get paid off, I also have about £500 on my next account. I do really well it off then put more on Saying this my husband used to always pay for everything in cash, his car etc never had a cc and it was him that they were awkward with for our mortgage, despite him being able to afford it on his own because he had no credit history. I think that’s bad.

 

[Tricham]

We are 28 and 29. No debt apart from the mortgage, which has £68000 left (started at £150k 5 years ago). I've never liked the idea of spending money I don't have (other than for buying our home obviously).

 

[Greed-Futures]

US student loan debt (SO and I both have doctorates so they are hefty loans, but we pay an income driven repayment every month like clockwork) and our mortgage. Everything else we pay cash and work to save as much as possible so we can make bulk end of year payments against our student loans while also keeping about 6 months' pay in our savings account (God forbid we ever need it). We live pretty frugal - never have the latest phone or best phone plan, almost never buy clothes unless something wears out, take one holiday a year and it's usually a camping trip, etc. Feel very blessed to live this way.

 

[carebear123]

Age 32
debts
owe my stepdad £500
argos card £500
we rent our house not been lucky to buy yet
I was a young mum and did get in a load of debt overdrafts store cards doorstep loans when I was with my violent ex,he got me to take it all out stupidly in my name but it's all paid off .
I'm very careful with money now as I had to go without to pay it all off.

 

[WilmaHun]

I'm so glad I've seen this thread! I'm 25 and am so embarrassed by my financial situation.

Car loan - have around £500 left to pay (it's only £79 a month). I could just pay it off in full now but there's a £170 early repayment fee so I'll just stick to the £79 a month until April.

Credit card - £1,900 - 0% interest for 18 months. I pay a £46 direct debit each month and try to pay additionally up to £50 a month (some months I don't manage an additional payment)

Argos card - £300 (buy now pay later)

Student loan - £15,000 (part time student - work full time. On fourth year out of six) - not repaying anything yet.

My partner and I are currently in the process of buying a house so will soon have a mortgage of around £150k.

Phone contract of £43.00 a month which ends next May. I'll be keeping the same phone and going onto a cheap sim only tarriff.

I wish I hadn't got into credit card debt but I made some stupid decisions with money when I was younger. I did have a New Look card with £1,200 on and an Outfit card with £800 on which I managed to pay off. Fortunately it hasn't prevented me getting a mortgage but I would have been able to get much more if I'd not got credit cards.

 

[GiftedNotFree]

How do you find out your credit score please, I don’t have a clue about mine?

There are 3 main Credit References in the U.K:
Experian, Equifax and TransUnion.

There are free services that show you a credit report e.g ClearScore. Lenders don’t report to all 3 credit references which can mean one service will not show you everything. For example, payday lenders only really report to TransUnion so if you were to view the Equifax credit report it would not show you any payday loans you’d had.

You can access your credit report(s) through a service like ClearScore. I’d suggest creating a ClearScore account, a Credit Karma account and Martin Lewis Credit Club account.

CS reports from Equifax; MLCC reports from Experian and Credit Karma reports from TransUnion. Having all 3 accounts will mean you see entire view of your credit history.

Hope that makes sense! As an aside, NEVER PAY FOR A CREDIT REPORT / SERVICE / ACCOUNT! All 3 above are FREE and any site or company that says they offer more information or credit building tools etc are 100% a money making scam.

 

[FlutterbyeSummer]

Interesting thread.

1200 on credit card
Approx 2500 student loan
85000 remaining on mortgage

Partner pays for his car etc.

I have about 9000 in savings (used to have a lot more but it went on renovation, surgery, maternity leave). I can see me not having this much for much longer.

Managing money is so hard.

 

[50sGirl]

I'm not in any debt. I try my best to live within my means and I'm quite frugal by nature.

I'm thinking of getting a new car as mine is 11 years old now, but I hate the thought of taking out finance. I've found a car I like that's affordable and ticks all my boxes but it's not a 'cool' make. I wish there wasn't societal pressure to have the 'right' things to fit in, and I wish I cared less about what others think!

Good for you!
It’s such a shame that so many people are brought up believing that they must have the best of everything immediately. There’s no shame in saving up until you can afford it and “making do” until then.
I hate that society pressures others into having the perfect “Instagram” life and people end up in debt over it.

Only debts I’ve ever had were my mortgage and a car loan and a home improvements loan all through the bank.
Only been overdrawn once in my life and that was because I miscalculated my bank balance.
I was brought up to only buy it if I could afford it.
Obviously major items like homes and cars you do require help but I always paid my credit card off in full so as not to incur interest.
We overpaid our mortgage every month so we were mortgage free in our mid 40’s and have no debt.
We only change our car every 10 years (still buy used not new) and start saving for the next one immediately. I’d also say our income is below the average for the UK, I budgeted well when we were younger which helps us now.

I do know I’m lucky being of an older generation and it is so much harder to get onto the property ladder now.
Thankfully my children are savers too but I should imagine when the time comes for them to buy a home then we will have to help them out.
I hate that my youngest has a huge student loan but that’s how it is now I’m afraid.

 

[ElChanguito]

None. But only because my parents are no longer here.

 

[Blessed]

Just my mortgage and car, I still have nearly £1.5k a month fun money after all bills are paid. I have CC’s and accounts with Next & Very but I always pay it off and the mortgage is overpaid every month. We have plenty in savings so in summer we will get rid of the car and buy a newish one outright with savings.

8 years ago I was in £25k debt and renting. Lots of hard work and savings and we now have a good saving pot and our own house. We have had several promotions, bonuses and 2 redundancy pay outs along side a year of saving £1k a month (it was a killer but so worth it!) to help. No outside help, all done on our own.

I’m curious how much of debt comes from poor money education. I’ve recently been helping my mum with her finances and they are a mess. All through my teenage years I remember my dad throwing money around- though we had none and then my mum getting into debt to clean up his messes.
I lived in my OD all the way through uni up until I was in my late twenties. It was only when I had my baby I sorted my money out. I do have bits and pieces of debt (car loan etc) but I know what I have now when for years I wouldn’t even check my bank balance because money made me so terrified.

I agree, if financial literacy was taught in schools, from a young age everyone will learn the basics of how to budget, save, invest and shop reasonably. Although debt helps the economy, writing off debt doesn’t. A lot of debt is written off due to poor management, false advertising, lack of knowledge, etc.

If financial literacy was taught in schools, I believe we will have a healthy robust economy as not all debts are bad.

My husband and I have a mortgage of around £680k (we bought our first home this year), we have credit cards but always pay it off in full. We both save and invest and plan to pay off our mortgage in 15 years time God willing.

I am grateful for my upbringing and have always saved and lived within my means.

 

[OnlyHereForTheLolz]

Thank you! I’ll contact them!! x

I was also going to advice consolidating i to one debt.
It’s hard for people and I understand that if something goes wrong people get into debt in one month and then can just never manage to get out.

I grew up in South Africa and my dad drilled into me from a young age not to buy anything on credit. It’s been great because I’ve never really had any debt (apart from mortgage) but on the other hand I think it’s also left me with some issues as I find it hard to spend money on myself. I’m forever squiralling away money, like you will find about five different places in the house I hide money and then have all different savings accounts . I think my dad talked to me when I was too young and it has left me scared of being made homeless and I mean the proper left on the street homeless.

 

[Be More Pacific]

I have student loans through SFE but I don’t seem to be making a dent in paying that back - it will be written off in like 26 years and I doubt I’ll gave paid it back before then. Seems like a bizarre system.

My car is on finance but I have no mortgage, overdraft or credit cards.

My partner is in about 4K worth of debt with pay day lenders and it’s crippling her trying to pay it back quickly. If I’m honest it really worries me as we are starting to head towards living together.

I have a small house deposit but am finding it really tricky to actually start the moving out processes. I go into a massive panic anytime I even start to look at mortgage rates etc

Just to make you aware, as someone who worked in the finance industry (mortgages) for 24 years (and still got into a lot of debt - the irony does not escape me) a lot of lenders do not like or accept potential borrowers with any kind of pay day loan history - it is a big red flag that they cannot manage their finances appropriately - so you may have to approach a more specialist lender or leave her off the mortgage altogether.

 

[Dizzy]

No debt aside from our fairly hefty mortgage. We have good pensions but should save more. My disposal income goes on clothes (trying really hard to buy less this year), holidays and socialising.

 

[Jgizzle]

About 600grand mortgage
Car loan 50 grand
5 grand in credit cards which could be paid off but it’s 0% so who cares for a little longer

gosh that sounds scary. That’s london for you baby! But manageable for our situation.

 

[Dandylion1]

Just curious how people are in debt with PayPal?