# 35 and 62k in debt



## mrsnocash (7 Feb 2009)

Age: 35
   Spouse’s/Partner's age: 34

   Annual gross income from employment or profession: 31k (was 42k base +commission)
   Annual gross income of spouse: 26k (was 30k)

   Type of employment: Sales

In general are you:
(a) spending more than you earn, or
(b) saving?
Spending more than we earn

   Rough estimate of value of home
   Amount outstanding on your mortgage: 302k
*What interest rate    are you paying? *5.19% fixed till April 2010

   Other borrowings – car loans/personal loans etc     39k

   Do you pay off your full credit card balance each month? No in arrears
   If not, what is the balance on your credit card? 23k

   Savings and investments: none 

   Do you have a pension scheme? no

   Do you own any investment or other property? no

   Ages of children: 17 & 9

   Life insurance: only mortgage protection €75pm

Utilities 150pm
Childcare 550pm
Cars  (petrol, tax, insurance) 200pm
Health insurance 150pm
TV/Internet 60pm
Food etc 600pm

I'm sure I'm leaving obvious outgoings but can't think of them

Basically we are up the creek without even a branch to help. We've borrowed on foot of what had become the "normal" income, with regular commission coming in. The commission has come down to a mere trickle and my base salary has dropped due to pay cuts in order to keep my job. OH has taken a pay cut too but thankfully not as big as mine.
We have 5 different loans (all with banks) and our cc debt is on 3 cards. 2 of the loans are up to date but the other 3 and the cc's are all in arrears. I've contacted the cc companies, to see about coming up with a payment plan but no joy there and I imagine the banks will be the same about the loans. 
We really need to sort this out before we crack up. OH is very depressed and visibly upset about the trouble we're in now. We'd sell our house and start over if we thought we could get the price that we bought it for back but the houses are selling for up to 100k less than what we paid for ours. 

Our mortgage is up to date but we're due an increase from 1300 to 1800 pm in April so who knows what'll happen then

If we can show the cc companies & bank that we can only afford to pay them €50pm each for the forseeable future will they accept that or will they continue to take us to court for money we don't have and won't anytime soon

Has anyone been in a similar situation and gotten some sort of break from banks or has some advice as to what to do.

I know we've been really stupid, I've lectured myself and OH about it but fact is we're in trouble and we're seeking help albeit a bit late


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## capall (7 Feb 2009)

What do you mean continue to take us to court ?  And what do you mean that your mortgage will go from 1300 to 1800 in april

You cant get blood out of a stone what would the bank achieve by taking you to court. Meet the banks and tell them how much you can afford to pay,they can take it or leave it. If this went to court that is all they would get anyway I think
Why dont you go to someone like FLAC(free legal aid) to find out about this side of things

You should focus on the credit card debt as the interest on this will sink you.
Do you have any options to refinance this ? How are you fixed with the credit union,would anyone in your family be able to give you a loan


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## PaddyW (7 Feb 2009)

capall said:


> ?  And what do you mean that your mortgage will go from 1300 to 1800 in april



Perhaps coming off interest only?


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## dereko1969 (7 Feb 2009)

sell the car/cars and buy cheaper ones if possible, prices have gone way down but if may help.
as most of the other posts here suggest, start a spending diary and see where your money is going exactly and try to cut spending then, shop in aldi/lidl buy cheaper cuts of meat.
but first of all go to MABS if you can and see if they can get the banks to hold off for a while.


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## Billo (7 Feb 2009)

Childcare 550pm.
Is this for the 9 year old.


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## Bubbly Scot (7 Feb 2009)

Billo said:


> Childcare 550pm.
> Is this for the 9 year old.



I wondered about this too as I have children of the same ages. Might be an idea to sit the 17 year old down and explain things are a bit tight and their help is needed. At 17 s/he could be helping out with childcare, reducing that bill. Even if you paid the 17 year old you could reduce that bill.


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## mrsnocash (7 Feb 2009)

Thanks for the replies

Our mortgage is interest only at the moment and that option will be gone this April. Our childcare is for afterschool care but while it seems high it is on a budget plan so that it remains the same every month even when I use it for full day care in the summer/easter etc.
Its the cresit card companies that are threatening to take us to court unless we come up with repayments of €200 pm each, which we can't afford. 
We shop in lidl and tesco. I do my shopping online so that I can keep track of what I'm spending as i go along the list. I try to buy own brand products (some are just tastless so the brand names win). We both bring lunches to work, haven't seen the inside of a pub in months and we have even stopped buying beer/wine at home.
Wouldn't make any huge savings if we sold the cars and bought cheaper ones as the cars are old as is. We do need the two cars as with 2 kids we spend our evenings/weekends as taxi services. I need the car for work and on occassion it means overnight stays so the other car is needed at home. 

We've sent the MABS letters to the cc companies and banks that we are in arrears with but just got the standard reply reminding us of the agreement we signed with no reference to why we were writing to them. Going to sit down this week and do up a budget plan outlining all our incomes & expenses and will send that to banks so that they can see that we don't have the money at the moment.

Has anyone though gone down this route and gotten a favourable response from the banks. From talking to people working in the banking sector it seems that the banks have worries of their own now and are taking a zero tolerance approach to arrears on loans/cc's


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## D8Lady (7 Feb 2009)

Could you give a listing of each credit card and loan, the current balance, monthly repayment, the interest rate being paid and its status e.g. up to date / arrears.

e.g.
Bank Loan 1 = 1,000K, 8%, 150 p.m,  up to date.
Credit card 2 = 20,000K, 14%, 150p.m., arrears

Having a look at the hard maths may help generate some additional ideas.


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## Artois (7 Feb 2009)

It looks like banks are being forced to give a 6 month period before they initiate legals.

How about not paying the mortgage for 6 months and focus on clearing/reducing the more expensive debt like the credit cards etc. Also sell the cars and if you need one get a old cheap car


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## helens (8 Feb 2009)

Hi sorry for your troubles..i know how you feel..i havnt got much help for you but If your credit cards are with mbna they will help you out a bit.They have currently knocked off our late fee's for 3 mnths & said if we get out of arrears then they can reduce the interest Rate.


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## Cheeus (9 Feb 2009)

Your mortgage protection seems high at €75 a month. I'd go to a broker and get a cheaper quote. My mortgage is a bit less than yours and we pay €27 a month for joint mortgage protection - most basic cover but perhaps that's as much as you need at the moment?


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## limerick123 (9 Feb 2009)

yes the mortgage protection is a rob. if the cars are old how do you still owe 39k on them?


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## deedee80 (9 Feb 2009)

> yes the mortgage protection is a rob. if the cars are old how do you still owe 39k on them?


 
I think they are paying 200 a month in total on two cars so I don't think this is correct.  39k would be two VERY expensive cars imo.


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## funnymunny (9 Feb 2009)

I don't know if I read the post wrong as no one else seems to have contradicted what Artois has said.  I think its appalling advice to stop paying your mortgage for 6 months and I hope its advice that you would not take.


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## Gus2008 (9 Feb 2009)

What about getting a part-time job?


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## legallady (10 Feb 2009)

Can the 17 year old get a part time job? I know they may be scarce on the ground these days though...


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## mrsnocash (10 Feb 2009)

Thanks for replies. To make our situation worse we have collectively taken a 20% pay cuts in wages since last Friday but we're still manging to smile through it all.
The loans we took out were not just for car loans but for home improvements that are worth nothing in todays market.
17yr old is diong LC this year so part time job is out of question. 
Have spoken to one of the cc companies and they have agreed to reduce our repayments to what we can realistically afford based on our current financial situation.  They also advised us to contact all our other creditors and say that one creditor has given us this option and that we'd like the same response from them. Hopefully we'll be able to get ourselves sorted and will be debt free in about 20 years but at last i'm starting to see some light at the end of the tunnel.
OH has tried to find part time job but no joy.

Will keep ye posted if i have anymore luck with our creditors as I'm sure there are others out there that are in same boat and like us could do with some hope that its not end of world and that it can be sorted


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## D8Lady (10 Feb 2009)

Can you switch some of the credit card debt to another card that has zero interest for 6 months? At least any money that you pay off will go to the actual loan and not interest payments.


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## dafmurray (16 Feb 2009)

Have to agree that the very worst thing you could do is not pay your mortgage.  This would effectively remove any hope of any sympathy from bank or court if it came to that.  You must show that you are prepared to pay what you can towards mortgage and other debts, or are at least trying to come up with a budget.

*Money Advice & Budgeting Service* would be an essential step.  Make an appointment immediately.

As another poster stated, transfer credit card debt to introductory zero interest rate offer by another card provider.

Also, look up Irish Independent newspaper online and search for articles under *Your Money* peronal finances advice section in each Tuesdays edidtion.  Editor of Your Money section is Charlie Weston.  There have been several articles about the options for dealing with multiple debts and deteriorating salary, etc in the last several months.

Above all keep in regular touch with bank, credit card company, etc and tell them what you are doing to try to meet your committments to them and ask them for options.  They are dealing with many people in similar situations to the one you find yourself in.

Remember many people have come through similar circumstances to you and don't loose heart.  Take one action at a time and keep taking them and you should get through this.


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## jhegarty (16 Feb 2009)

Cheeus said:


> Your mortgage protection seems high at €75 a month. I'd go to a broker and get a cheaper quote. My mortgage is a bit less than yours and we pay €27 a month for joint mortgage protection - most basic cover but perhaps that's as much as you need at the moment?



Agree with this. Unless there is specific reasons you should be able to half that.




Artois said:


> It looks like banks are being forced to give a 6 month period before they initiate legals.
> 
> How about not paying the mortgage for 6 months and focus on clearing/reducing the more expensive debt like the credit cards etc. Also sell the cars and if you need one get a old cheap car



Worst advise I have ever seen on this site.


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## Caveat (16 Feb 2009)

jhegarty said:


> Worst advise I have ever seen on this site.


 
Yes.  Surely an oficial 3 month moratorium is an option though?


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## jwestave (3 Mar 2009)

totally agree with jheagarty.. terrible advice


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