# Can't get ahead of things



## leelee (14 Jul 2009)

Age: 34
Spouse’s/Partner's age: 35

Annual gross income from employment or profession: 36,000
Annual gross income of spouse: 15,000
Child Benefit = c.300 per month

Type of employment: e.g. Civil Servant, self-employed 
Me: private sector
Prt: self employed 

In general are you:
(a) spending more than you earn, or =  not really
(b) saving? = no

Rough estimate of value of home = 350,000
Amount outstanding on your mortgage: 70,000
*What interest rate are you paying? *
*Ulster Bank Fixed rate for approx. next 3years @approx 5.5%*
*@ €810 per month*

Other borrowings – car loans/personal loans etc
Car loan 5,500 oustanding (18 months@ 300)
C/Union Home Loan 9,000 (repay 55.00 per week incl. interest)


Do you pay off your full credit card balance each month? No 
If not, what is the balance on your credit card? 4,000

Savings and investments:
8,000 c/union (can't be touch as loan above savings)
1,300 Royal Liver saving plan (planning to cash in if needed)
Had SSIA but spent on house renovations which were badly needed

Do you have a pension scheme? No

Do you own any investment or other property? No

Ages of children: 3.5 & 9
3.5 in creche @205 per week (cost causing the difficulty we are in)

Life insurance: Yes lots -
32 p/month serious illness
100p/month (covers mortage and also provides a amount equal to monthly salary if either dies after mortage is paid)


*What specific question do you have or what issues are of concern to you? *

*need to release pressure.  DH is self employed tradesman and for past 2 months had literally no work - hence finanical strain - can't tell when money will be in - work will come in. He is not entitled to SW as I work - I earn 2480 just over FIS threshold. *

*Half thinking of closing up his business and having no creche/childcare fees but dont' think entitled to SW assistance then as I earn 36k.*

*Have some outstanding bills to pay*
*2,000 bin charges (have agreed with Council to pay 100 p/month)*
*3,000 in arrears with creche*

*We don't have lavish cars - both have 01 so can't save there*
*Creche has to be paid to have DH free for work. *
*His company account has c.5,000 but needed to cover tax, insurance, accountant etc.*

*My thinking: take out personal loan of 15k @ 310 per month over 5 years to clear Visa, Car loan & creche arrears + cash in royal liver to reduce bin charges. *

*We don't go out socialising, buy expensive clothes (all dressed from Pennys!) - do smoke which i know is saving No.1 but apart from that just not enough to cover all the bills and have much left over. *

*Any advice welcome....*


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## niceoneted (15 Jul 2009)

This is what I would do, 
Cash in the royal liver policy and pay it off the credit union loan, then loan will be less then shares and I would ask the credit union to cancel them out, you can stop paying into credit union for a while or only put in few bob a week thus freeing up best part of 200 euro a month. 
I would get your husband to stay at home from work and mind your child saving up to 800 euro a month. 
Try to move balance of credit card to interest free period one and using the freed up cash you should clear that by year end. 
Your husband could still perhaps do some jobs but on the evenings and weekends. I would prefer to be able to have trades men in the evenings and weekends so as not to have to take time off during the day to be there. 
Try and cut back or give up the smokes - try the Alan Carr book it worked for me. 
Make sure you are not using excess amounts of heating/electricity, cut back to basic sky package etc. 
It might be worth your while to see how much it would cost to break out of the fixed rate mortgage seeing as the amount outstanding is low. 
If you get that far you will feel like you are making progress.


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## eirefinq (15 Jul 2009)

how do you manage to have a house worth 350k and a mortgage of only 70k with a monthly repayment of €810? I know people paying €810 per month on a mortgage of 300k! Also what does DH stand for? Talk to your bank and see how much it costs to renegogiate the loan repayments.


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## samanthajane (15 Jul 2009)

The people paying 810 a month could have 25 years left on their mortgage, where as the op might only have 10 years left. DH means her partner/husband. 

Agree with what niceoneted has said some good ideas. 

Have you thought about your husband only working part time. So instead of paying for childcare full time mon-fri you could cut it down to 2/3 days. So he would still be available during the day for 2/3 days a week if he had a call about a job.


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## chlipps (15 Jul 2009)

niceoneted is spot on with the credit union situation... get the 8k that is tied up released asap. Also DH should be athome if only 15k income as most of that is gone to creche and accountant fees. 

as your DH income is low, ensure that some of his tax credits are transferred to you so as to reduce your tax bill


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## so-crates (16 Jul 2009)

You two are spending 10 grand to earn 15 at the moment. And since a fair proportion of the €5k that leaves (basically €100 pw) is probably eaten up by business related costs and the last of it sucked out in cigarettes it is likely that at the moment it isn't paying for itself or if it is it is only just doing so. What I am trying to say is that although your husband stopping at home to mind the children may mean less money in, the difference financially will not be as dramatic since considerably less will also be going out.

Currently your monthly bills amount to €1342  based on your figures below and on top of that you are paying out €260 per week which amounts to roughly another €1000 a month. So before you pay anything for food, clothing, heating, electricity or touch your credit card bill, more than €2000 has been spent.
IF you were to get that €15k loan @ 310pm your current monthly bills would rise to €1352 so your predicament would still be pretty much the same (basically what you are doing is rolling the credit card debt onto the car debt and extending the term of the car debt).
If I was a lender I would be wondering if you would be able to afford the repayments since you are struggling now and this would not change the amount you repay (though it would include more debts into your repayment).

I think that the approaches which have been suggested are the best ways to go. Your husband give up the job to remove the requirement for a creche (given the age of the child they will probably be starting school next year so it makes for a natural point to reconsider what to do then), unfortunately you will still need to continue repaying them but at least the debt won't increase. Negotiate with the credit union, either you could cash in the policy and pay off the whole sum from the CU or potentially you could reduce your shares to 25% of the balance owed (If you reduced your shares to €350 and part-paid off your loan, the outstanding loan would drop to €1350, I don't know that they will allow this but that works out as 26% - you could then negotiate a smaller repayment if you preferred). This would leave you with the policy that you could cash and use as payment towards either the overdue creche fees or the overdue bin charges. You haven't mentioned any repayment plan for the creche fees so I would suggest perhaps using the savings plan against that and negotiate a repayment of €400 per month (half the usual fees).

In about 6 months time you should have more income freed up as the CU loan and the creche fees would then be repaid, freeing up an extra 800 pm. It won't be an easy time but at least it will give you a definite time to work towards.


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## fogart (16 Jul 2009)

Could you not approach your lender to get top up mortgage to pay off all debts even if it means extending period of loan?Write all expenditure down and pay off loans with highest interest rates first.Pay the creche off and reduce hours there or leave altogether.Husband can mind kids first thing in the morning, you go to work for 7/8, leave at 3/4pm, he could try and get some work then. Also he could work weekends.Very soon you would see huge difference in outlay etc.You dont own huge amount on your mortgage.Try talking to broker if they deal with the lender that your loan is with.They would be able to tell you if they could get loan.Should be able to get 50k added to mortgage with same lender.All you need to do is get through the next year or so until your youngest goes to school and husband can get more work.Think twice about cashing in the Royal Liver policy as you would lose bonuses.They are brutal policies.Mine is only going to break even after 10 years but significantly less if I cash in early.


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