# Silly debt from working in bank..need help



## SarahQ (27 May 2009)

Hi,

I worked in a well known bank from the time I was 18 - 22. In this time I gathered a lot of debt as they practically threw money at me and being naeive I took it...

I now owe *€33,500* and want to pay it off asap. I missed a couple of payments recently due to illness but have no arrears. Really want to apply for a mortgage with my other half in the next year but know i've no hope (or do I?) of getting one with my financial mess at the minute...

Age: 24

Annual gross income from employment or profession: 29000

Type of employment: Private Sector Employee 

In general are you:
(a) was spending more than I earn

No mortgage

Do you pay off your full credit card balance each month? No minimum
If not, what is the balance on your credit card? 1. 3000 2. 5000

Savings and investments: zilcho

Do you have a pension scheme? No

Monthly outgoings:
Car: 344.44 - restructed my loan over 7 years but really want to pay it off asap (balance €24000)
Rent: 300
Credit Card 1: 150 (minimum payments) Balance 3000
Credit Card 2: 260 (minimum payments) Balance 5000
Esb: 100
Internet: 15
Petrol: 100

Also overdraft of 1500.

I come out with about 2k a month plus have a casual part time job that can earn about 300 a month.

Money is just in a mess at the moment so really need advise on the best way to tidy it and clear it off asap so I can move forward - feel like I can go no where i.e. buy a house.. with this hanging over me.

Thanks


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## jhegarty (27 May 2009)

How much is the car worth ?


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## SarahQ (27 May 2009)

Hi,

Its worth about 7000 but needs repairs of about 1000. To be honest I need my car for work so it wouldnt be an option to sell it.


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## spursfan1234 (27 May 2009)

why not. can u buy a car for 1k and pay 6k off the rest


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## johnny1234 (27 May 2009)

How did you mange to buy a car in excess of 25k and now it is worth only 6k. I think you really will have to have a change in lifestyle to sort this out. Have you any family members to assist you in with the Credit Card debts, or to get another loan to clear the smaller items which will be cheaper to deal with. How about lumping the two balances together and going for a card with an interest free period.


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## jhegarty (27 May 2009)

Agree with Johnny here. I think they are underlying problems we are not aware of. 

(Unless the car was crashed or something).


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## SarahQ (28 May 2009)

Sorry I wasnt clear enough...

Car loan would be more of a personal loan of €24k...

I dont think my ICB rating would warrant anyone giving me another credit card to pay off the other 2 balances to be honest.

I've thought about getting one big consolidation loan to pay off everything but i'm unsure if the bank will give me one because of my previous history and the way the economy is now.

I just want to get rid of my debts asap - i'm a lot more sensible with my money now than I was 3 years ago when I got into this debt and really dont want to be paying the price for it for the next 5 years.


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## Guest116 (28 May 2009)

There is no quick way to pay off 33.5k based on your incommings and expenditure. It is going to take a good few years.

Do you have scope to increase your income in any way? Career progression etc?


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## Celtwytch (28 May 2009)

It can't hurt to try to transfer at least one of your credit cards to one with 0% interest on balance transfers.  True, you might be refused, but you won't know unless you try.  

One trick that I found useful when paying off credit card debt was to divide the minimum payment by 4, and pay _at least_ that amount each week.  You may find that you can afford to pay a little bit more than the weekly amount, which means that you'll be paying a little more than the minimum amount each month.  It's a lot less daunting to pay smaller weekly amounts than one big payment each month.


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## johnny1234 (28 May 2009)

SarahQ said:


> I just want to get rid of my debts asap - i'm a lot more sensible with my money now than I was 3 years ago



Sorry Sarah but it doesn't seem to be the case. If you continue to pay only the minimum balances of your CCs you are walking down a very slippery slope. Has your partner any savings to give you a dig out as really it will be a battlezone to try and bring yourself to an even keel.


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## Macstuff (29 May 2009)

Hi SarahQ

Firstly, sorry to hear that you are in this situation - it's probably stressful for you. I too have alot of personal debt and am working my way towards paying it off. 
I cant suggest much of a solution as in reality your net disposible income doesn't leave you much room to solve the problem in a hurry through acceralated payments etc. 
I do have a couple of observations to make....
1. Im not sure you have a clear picture of your monthly outgoings eg I notice you don't include any figure for food as part of your monthly spending list, your petrol costs seem too low. I do relatively little driving but spend about 150 a month on petrol. 
I'm not trying to pick holes in your summary - all Im trying to do here is point out that you need to get a very accurate picture of your spending habits. At least then you will know the areas you can cut back on. 
2. When it comes to repaying the debt - you should prioritise the credit cards. Can you do anything to reduce these balances quickly? You should at least look for a bank loan to get them paid off - failing that, perhaps one of your relatives could lend you the money? 
Credit card debt is really expensive so try come up with some sort of way to get it paid off. 
Failing that - at least do a full / partial balance transfer to another provider - I heard this week that Ryanair have a card with 0% interest for ten months. You would still have to make a minimum payment but at least you wouldn't be paying high interest. 
3. Can you do anythign to increase your income - a second job, casual work etc?
4. Finally a trick thats really working for me is to make an accurate estimate of the ESSENTIAL weekly money that you have to spend. Then withdraw that amt. of cash from the ATM on a particular day per week. Crucially, you are not allowed to withdraw any more cash for one more week. It sounds childish, but it works. 
Currently I withdraw 150 each Friday from my ATM and use that to pay all living expenses (petrol, food, entertainment etc.) It took a bit of getting used to but it's helping me curb my spending alot.


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## Mpsox (29 May 2009)

1: forget about buying a house for now, prices are currently only going in one direction and given that the banks have largely stopped 100% mortgages, to cover legal fees, deposits etc you'd need to probably save 20-30k, you need to focus on cutting debt

2: try and stick at least €50-€100 into a saving account monthly. Firstly it will give you some rainy day money, secondly you are establishing a saving record and thirdly it will mount up quickly and make you feel that bit more secure about your situation. 

3: make sure your tax affairs are 100% in order and that you are claiming for the maximum you can

4: have a change jar and chuck your coppers/10c and 20c into it at the end of the day. I empty mine annually and lodged €350 last month. You won't miss it day to day

5: chop up the credit cards. no point in making minumum payments if you are adding to the debt

6: review your position monthly and keep a track of how you are doing, psychologically you will start to feel more secure and in control if your debts are falling and you're starting to save, even if it is only a little every month. Good luck


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## Locke (29 May 2009)

Mpsox said:


> 6: review your position monthly and keep a track of how you are doing, psychologically you will start to feel more secure and in control if your debts are falling and you're starting to save, even if it is only a little every month. Good luck


 
This is a very very good point. It's hard to stress the importance of how different you will feel when you start to control and manage your debt better.


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## Silver2 (29 May 2009)

With the Credit Card Debt:

Cancel the cards in writing & state how much you intend paying off each month: by doing this it will save you paying the duty on you cards each year: 30euro x2 - I cancelled my card before Christmas thus didn't have to pay the duty in April.

I don't know what other posters views on this is: but if you have protection Insurance on your cards, and your job now is stable:  I would cancel it: Use this extra money to repay the cards.


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## Havana (29 May 2009)

I cannot recommend a spending diary enough. Since i started one a couple of months ago i have really reduced unnecessary spending. I fill it in religiously each evening down to the last penny- and i mean penny. When i do up my totals each day i count the coppers in my purse. It actually gets quite addictive and when i'm in a shop about to buy something i don't need, however small, i think twice cos i know i'm going to have to account for it that evening.

also it's important to be aware of your finances. My friends slag me but i always know to the penny how much i have in my account each day- i even get a text from the bank each morning with my balance. Much harder to over spend when you know how much (or little!) you have.


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## nmesisca (29 May 2009)

Havana said:


> I cannot recommend a spending diary enough. Since i started one a couple of months ago i have really reduced unnecessary spending. I fill it in religiously each evening down to the last penny- and i mean penny. When i do up my totals each day i count the coppers in my purse. It actually gets quite addictive and when i'm in a shop about to buy something i don't need, however small, i think twice cos i know i'm going to have to account for it that evening.
> 
> also it's important to be aware of your finances. My friends slag me but i always know to the penny how much i have in my account each day- i even get a text from the bank each morning with my balance. Much harder to over spend when you know how much (or little!) you have.


 

agreed.
I do exactly the same, plus I categorized all the expenses and can 'report' on monthly/weekly expenses for food, fun, health, phone etc etc.
friends slagging me a LOT and calling me (anal) freak. meh. 
It does make a HUGE difference though. since I started last year in June, I brought down my expenses a good 30% and without making a huge sacrifice.
I use an excel sheet by the way. If you/others want it to customize it, just drop me an emial I will be happy to provide.


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## AlbacoreA (29 May 2009)

Havana said:


> ... i even get a text from the bank each morning with my balance....


 
What bank does that?


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## Havana (29 May 2009)

Nib. It's really handy. Can choose what texts you want. I get one to tell me my balance, when i have a large deposit made- unfortunately the only one i ever get is my wages! , when my balance is below €100. Think there are a few others you can get and it's free.


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## nmesisca (29 May 2009)

AlbacoreA said:


> What bank does that?


 

Permanent TSB has the same service.


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## AlbacoreA (29 May 2009)

Very handy! Do they charge you for them?


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## nmesisca (2 Jun 2009)

AlbacoreA said:


> Very handy! Do they charge you for them?


 

not TSB


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## SarahQ (4 Jun 2009)

Thanks for all your helpful replies.

I called GE who I have the loan with and I actually owe 23k. Taking that into account with my 2 credit cards for 8k do you think BOI would give me a consolidation loan over 3 years? I've worked everything out and can afford to pay £1000 a month off so it can be paid in 3 years. 

I'm just worried they'll point blank refuse me because of my credit history - will the Underwriters not take into account my willingness to get out of debt and the fact that I have  secure job? Bearing in mind also I will be (hopefully) due money in a couple of years (about 100k) so I will be investing that with them.


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## Bob the slob (4 Jun 2009)

Hey Sarah, sorry to hear about your predicament.  If you have a laser card cancel it and get a bank card/atm card only.  I found I had a lot more disposable cash to pay off my loans/cards.

Do you have anything of value that you no longer use? like personal electronics, unwanted gifts, things you dont use anymore. I sold some things on Ebay and made approx €350 in a few weeks.


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## SarahQ (4 Jun 2009)

Not really. I have a wii but my partner uses it a lot and he bought it for me so dont really want to sell it. Nothing else valuable really - maybe some clothes but cant see anyone wanting to buy them.


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## Sunny (4 Jun 2009)

Try the various banks for a consolidation loan but I hear these are very difficult to get these days. Banks have enough problems with their own loan books without taking on other banks' loans. They can only say no though.


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## so-crates (4 Jun 2009)

SarahQ said:


> Hi,
> ... Really want to apply for a mortgage with my other half in the next year but know i've no hope (or do I?) of getting one with my financial mess at the minute...
> 
> Money is just in a mess at the moment so really need advise on the best way to tidy it and clear it off asap so I can move forward - feel like I can go no where i.e. buy a house.. with this hanging over me.


 

Hi Sarah, just a few thoughts...

firstly you are planning with your boyfriend to buy a house - is actually he aware of your current financial situation? Have you told him? I just get the feeling that you maybe have had the "Lets get a house together" conversation without touching on the "I already have a big debt" problem. Based on your income and debt level 5 years to clear it would seem reasonable, 3 years will be very, very hard. Also the other thing is that you won't be able to contribute to building a deposit while you are clearing that debt. I am not trying to be discouraging but perhaps buying a house is not something you should be focussed on for another five years. At that point you will hopefully be debt free and may even have a deposit together.



SarahQ said:


> Hi,
> Car: 344.44 - restructed my loan over 7 years but really want to pay it off asap (balance €24000)





SarahQ said:


> Car loan would be more of a personal loan of €24k...
> ...
> I've thought about getting one big consolidation loan to pay off everything but i'm unsure if the bank will give me one because of my previous history and the way the economy is now.
> 
> I just want to get rid of my debts asap - i'm a lot more sensible with my money now than I was 3 years ago when I got into this debt and really dont want to be paying the price for it for the next 5 years.


 
The existing loan for 24k you say is "more of a personal loan" does this mean that you have already consolidated debts previously? Rolling them in with a car purchase? If you have, and even if you haven't, in addition to taking out that loan you also owe 8k on cards (I don't know whether you ran that up before or after taking out the sizeable loan with GE but I am guessing that it was after? Elsewise you'd have paid off your CCs using the personal loan). Also I notice you mention you restructured the loan - was that to pay it off more quickly or to increase it?

If you have done so once before and are seeking to do so again you really do need to look long and hard at your spending (and I do appreciate you are probably doing that now)



SarahQ said:


> I called GE who I have the loan with and I actually owe 23k. Taking that into account with my 2 credit cards for 8k do you think BOI would give me a consolidation loan over 3 years? I've worked everything out and can afford to pay £1000 a month off so it can be paid in 3 years.
> 
> I'm just worried they'll point blank refuse me because of my credit history - will the Underwriters not take into account my willingness to get out of debt and the fact that I have secure job? Bearing in mind also I will be (hopefully) due money in a couple of years (about 100k) so I will be investing that with them.


 
I don't think that a drop from 24k to 23k will make a significant difference in terms of whether you will be more kindly considered, the secure job and the plan of repayment are much more likely to carry weight. The fact that you might come into and inheritance at some point will carry no weight. You can't spend money you don't have and there is no guarantee that it will be yours. I'd probably not even mention it to be honest because it is basically says you are planning for money you don't have and may never have.

You have a plan (though for your own sake I would counsel perhaps looking at a longer timeframe and a smaller repayment) and you have identified how you want to meet it. I'd suggest trying for the consolidation. If you don't venture it you definitely won't get it!


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