# Debt problem



## patmustard (6 Apr 2011)

Hi there,

My wife and I are both unemployed with our only income being social welfare (approximately €1,700 per month inc rent supplement). We were out in Canada for a while and since we came back haven't been able to get jobs anywhere and are becoming increasingly desperate with our debt situation. 
I have appoximately 10,200 of a personal loan with AIB, with repayment of 230 per month, and around 650 on a credit card with them, paying back 10% per month. Wife has a loan of 9,500 with AIB, paying 235 per month, a credit union loan with 2000 outstanding, paying back 100 per month, and around 1400 on her credit card paying 10% per month. Basically we are fcuked financially and we can't ask anyone to help us out, friend or family. We are both on temporary breaks from the loan repayments at present but that's up next month. Our expenses are as follows:

Rent/esb/phone/bins/heating oil €750
Loans €565
Credit card payments €205
Groceries/other expenses €whatever's left over from €1,700, around €180. 

Now we have lived like this for a couple of months but this can't continue as we are both stressed beyond belief. We have no life at all at the moment or any room for manouvre. Can anyone advise the best options available to me? I've spoken to AIB and they did give a couple of months break to see if our situation would improve but it hasn't and we are just going to have to default on the loans when repayment is due again. I honestly don't care about a black mark going on my ICB report as I don't want another loan for as long as I live! (well certainly not for the next 5-10 years or so). I think we'd struggle to pay interest only to be honest and  that wouldn't actually tackle the capital sum outstanding. Could we just declare bankruptcy? We have no assets, no car or house or anything of value. No kids either, thank god. Would this be easier to do from the UK?

Sorry if the post is a bit all over the place but I just want to get my thoughts written down and hopefully someone out there can give a bit of advice.

Thanks a lot.

Pat


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## burmo (6 Apr 2011)

Hi,

Thankfully, I can say that there are many others in worse positions than you two.

I suggest to try and consolidate the credit card loans in the personal loans so that lowers the interest rates. If not try and pay the highest loans / credit cards first. 

At your current rate of payment you will be able to pay off about 30% by the end of the year... and if you restructure the credit cards into the personal loans, it will be a bit more due to the reduced interest. 

About bankruptcy... not sure, but it's not going to be easy and I wouldn't recommend it for so little debt.

Keep paying it off bit by bit, knowing that when one of you finds a job the debt will be cleared a lot quicker.


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## rescue16 (6 Apr 2011)

I hate to say this because I did not find them much good but other people think they are great so why not try out M.A.B.S hope they do more for you than they did for me . Good Luck


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## Guest105 (6 Apr 2011)

Hello Pat and welcome to ask about money

Burmo is correct when he says your level of debt is low and I feel it is far too low to be going down the bankrupty route. 

However, you have a problem and you cannot be expected to survive on such a tiny amount of money every month after servicing your debts. You hardly have enough money for food or for your electricity or gas bills. I have no doubt that it is an extremely stressful situation for you and your partner.

You need to go back to AIB and the credit unions and try and get those loans restructured. Do contact MABS, most of them are very helpful and they are very compasionate and sensitive to client needs. 

In the meantime try and seek help from SVDP in order to get you over this rough period. There is credit due to you for trying so hard and I wish you well.


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## patmustard (6 Apr 2011)

Thanks for all the replies guys. I'm probably going to contact Mabs first, then the banks and see can I get them to agree to lower loan repayments. I don't think consolidation of the credit card onto the existing loans will be an option as I had done that a few months ago and reduced my credit card limit drastically down to €700. We'll put all our energies into clearing credit cards debt and see how it goes. Not sure what the SVP can do for us but I'll contact them just to see if they can help with anything.


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## patmustard (7 Apr 2011)

Just a quick update: I went to the SVP this morning for a chat and they were very helpful. They are going to sort out a quick appointment with Mabs for me, and they mentioned that in some cases Mabs can ask a credit union to consolidate all our debt (AIB loans, credit cards, existing credit union loan) into one lump sum with them, and pay off that loan at a lower percentage rate than normal, around 6% or so. I'm not sure if that will be easy to do but I would be ecstatic about if it did happen. I'll wait to see how it goes. Going back next week to SVP again and they were good enough to give me €100 in grocery vouchers to help us as we are really struggling for short term cash. Thanks again Cashier for the advice - I wouldn't ever have thought of approaching the SVP but they were great.


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## Guest105 (7 Apr 2011)

I am delighted for you, I read a thread on here last year about an elderly couple in great need who received fantastic support form SVDP. Hopefully now things will get a bit easier and life will become more bearable for you and your partner. You will find MABS a great help once they start negotiating on your behalf and I do really hope that the credit union will agree to consolidate all your loans. I wish you well and I hope one of you will have luck in seeking employment soon. Keep us informed of your progress because it will help others in similiar circumstances.


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## Greta (7 Apr 2011)

Could there be any tax refund due to you or your wife for the year when you moved to Canada? Did you claim it?
When did you leave Ireland? If not too long ago and you had been working in Ireland until your departure and you didn't claim the tax refund then, you may be able to do it now, worth checking.

Also could you be due any tax refund in Canada?


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## patmustard (8 Apr 2011)

Hi Greta,

I've exhausted all the tax refunds available to us, Ireland and Canada. First thing I thought of last year when things were getting a bit dicey.


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