# Can't keep up payments on cheap tracker because of kid's college fees



## memubo (23 Jul 2013)

Age:* 47*
Spouse’s/Partner's age: *52*

Annual gross income from employment or profession:*31k  1900/m*
Annual gross income of spouse: *unemployed 188/week
*
In general are you:
(a) spending more than you earn, or
(b) saving?
*not saving and barely surviving*

Rough estimate of value of home *250k*
Amount outstanding on your mortgage: *180k left*
What interest rate are you paying?*Ulster Bank 2.15% tracker 18 years left
1000 per month* 

Other borrowings – car loans/personal loans etc
*Paying Accomadation for college €460/m*
Savings and investments:
*none*
Do you have a pension scheme? 
*yes (me 150 p/m, husband 200p/m).*
Do you own any investment or other property? 
*no*
Ages of children: *20yr-in uni 2yr out of 6 yrs done
17yr- will be off to 3rd level next year*

Life insurance: *yes mortgage cover.€143/m*
PIP: *€106/m*


My husband lost his job last December and at his age its not looking good for future employment.  With eldest in college and paying the mortgage it is a nightmare.  We do get a grant which covers the fees but we have to pay €460 a month for accomadation and approx €30/m to cover all bills.
The maintainence grant of €3125 is used to cover her travel and living expenses.
We had €10000 in savings which has been used to pay the mortgage until now and its is gone.  So basically we don't know what to do next.  We don't have a social life or buy many clothes. 
Any advice is welcome,  we really need help and advice.  Thank you


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## Spear (23 Jul 2013)

For starters, you should reconsider paying into your pensions. It strikes me that you can't afford it. Also, you should also think about whether you can afford life assurance, especially given your kids are finished school.


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## memubo (23 Jul 2013)

My pension is compulsary although my husbands isn't.  The life assurance was attached to the mortgage.


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## Brendan Burgess (23 Jul 2013)

Your income is €2,700 per month
Your RLEs are €1,700 per month
This leaves €1,000 to pay the mortgage

Next year, your RLEs will drop to €1,400 per month when you no longer have a child in secondary school. 

This will leave €1,600 to pay the mortgage. 

The Insolvency Service's Reasonable Living Expenses makes no allowances for sending children to college. It seems as if you you cannot afford it. Your child in college will have to take a break or borrow the expenses to continue. 

The good news is that you are paying only €300 per month in interest for the cheap mortgage you have. That means that €700 is paying down the capital each month, so you are gradually paying off your mortgage. 

Your husband should stop contributing to the pension immediately. As you are probably not paying the top rate of tax, it's not tax efficient anyway. 

What is "PIP: *€106/m"?  *If this is Payment Protection Insurance, does your husband have a claim for being unemployed? If not, cancel the insurance. 

You could ask Ulster Bank to switch you to interest only for 4 years. This would save you €700 per month. However, if I was in UB, I would refuse on the grounds that I am lending you money at 2% to fund your child's education.  But, definitely ask them.  

UB may offer you a deal of some sort which would involve going interest only in exchange for increasing the margin on the tracker.  You should avoid this unless it also includes a write down of the capital. 

A fair solution to both sides would be for UB to allow you to borrow an extra €30k at the SVR of 4.8% which you could use to fund the education and the repayment of the cheap tracker. I doubt if UB would be that creative though.

You could sell the house and you would have €70,000 cash. Could you rent somewhere for €1,000 per month? Probably unlikely, but it will allow you to fund your child's education if you don't want them to fund themself.  Selling the house would be a very last resort, as it would mean giving up your very valuable tracker.


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## SarahMc (23 Jul 2013)

Make sure the youngest picks a college they can commute to. 
Can the oldest transfer to a commutable college? Living independently in college is a luxury not many can afford, and many students I know are doing long bus journeys. Lots of courses don't have high contact hours so it's doable.

The alternative is they find a job and fund their own accommodation.


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## Jim2007 (23 Jul 2013)

SarahMc said:


> Make sure the youngest picks a college they can commute to.
> Can the oldest transfer to a commutable college? Living independently in college is a luxury not many can afford, and many students I know are doing long bus journeys. Lots of courses don't have high contact hours so it's doable.
> 
> The alternative is they find a job and fund their own accommodation.



My thoughts exactly!  Now it's a long time ago since I was in college - 1980s and times were bad then too, but there was no way our parents were borrowing money to put us through college!  We got our grants and tried to make do on that plus any bit of job we could find, even if it was only a punt or 50p an hour, busking tables.


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## memubo (24 Jul 2013)

Thank you for those answers.
*PIP wont allow us to claim until january 2014 and then it will pay half the mortgage for 1 year so we were going to hold onto it until then. Is this a good idea? or should we go ahead and cancel now? PIPs absolutely useless imo.* 

Eldest cannot transfer and youngest wants course in UCD also.  Do others get the kids to fund college themselves?  As far as I can see parents seem to give kids unlimited funds? we certainly dont and wouldn't even if we had it.

We are trying to sell house but no interest so far?  We want to downsize in everyway.

So I gather that mortgage wise we have it good since we have tracker?
In the meantime until the house sells we are financially sinking, but I suppose not in dire straits yet?


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## Brendan Burgess (24 Jul 2013)

Have you spoken to Ulster Bank? 

Selling your house is not a good idea. It is costing you €300 per month in interest at the moment.  Presumably it will cost a lot more to rent. 

You should keep the payments insurance as it will cost only €500 more before you claim. And the claim could be €500 per month. 

Brendan


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## STEINER (24 Jul 2013)

memubo said:


> Thank you for those answers.
> *PIP wont allow us to claim until january 2014 and then it will pay half the mortgage for 1 year so we were going to hold onto it until then. Is this a good idea? or should we go ahead and cancel now? PIPs absolutely useless imo.*
> 
> Eldest cannot transfer and youngest wants course in UCD also.  Do others get the kids to fund college themselves?  As far as I can see parents seem to give kids unlimited funds? we certainly dont and wouldn't even if we had it.
> ...



I went to college for my primary degree over 20 years ago on a full council grant fees and maintenance.  My parents had very modest income but I earned  a few bob during the annual summer hols part time work to help me.  Some part-time work during the summer hols by your kids will help out somewhat.

Can you reduce student accomodation costs in any way?  Can student come home more at week-ends to curtail spending?

I wouldn't cancel the PIP if you are going to make a claim in 5 months time which would pay half the mortgage.


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## Jim Stafford (24 Jul 2013)

Brendan

I refer to your comment below.

_The Insolvency Service's Reasonable Living Expenses makes no allowances for sending children to college. It seems as if you you cannot afford it. Your child in college will have to take a break or borrow the expenses to continue. _

The ISI guidelines do actually allow (under Special Circumstances) the fees and costs of a college going child.  The banks also allow such costs in informal settlements.

Jim Stafford


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## Brendan Burgess (24 Jul 2013)

Hi Jim

Thanks for that.

When you say under "special circumstances" - does that mean that a borrower can claim it as of right?  Or is it that in certain exceptional circumstances they might approve college expenses? 

Agree about the informal settlements which is why I suggested she contact the bank first. 

Brendan


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## Jim Stafford (24 Jul 2013)

Brendan

The ISI guidelines show that "college costs" are a "Special circumstance". So even in a bankruptcy, a bankrupt could still pay college costs of a dependent child etc. This is a recognition of the fact that some children might have to travel to a different city to do a specific degree. Whilst it would be difficult to argue a case for a child going to Oxford or Cambridge, I would see no difficulty with any of the Irish third level institutions.

Jim Stafford


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## MrEarl (24 Jul 2013)

While not ignoring the fact that memubo has genuine financial challenges to address ... I simply cannot believe there is no reference made to the two children having part time jobs in the original post.

I do not think jobs are easily found, but equally, I often see opportunities for part time work packing shelves, working in retail or entertainment businesses etc.

It seems that too many of our youths have been spoilt during our glory years, with endless handouts of cash given over by the parents when times were good.  Now it seems, the student population don't want to have to get up and earn a few quid for themselves, in many cases and whats worse, their parents appear to feel they are under obligation to keep handing over the cash while their (near) adult children enjoy the good life.

Tell the two children they need to start earning, even if it's a low paying paper round to start with ... it's a help during difficult times.


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## Cantalia (3 Dec 2013)

Your eldest simply must get a job. Simple as that, there are plenty of cleaning jobs. I know top barristers who chambermaided in Germany summer after summer to earn money for college, this is the 80's again. We all had crappy jobs in college. Yes she will have plenty time to study. Also they should stay in digs, food heating etc included, rather than a rental share. There are many all around the south side near UCD where thrifty housewives have a spare room for a student. DO NOT SELL OR GIVE UP YOUR TRACKER FOR NOW. You cannot afford the pension. Sorry, you must stop it for now, maybe when the eldest is finished college she can help contribute to it again then by way of payback. Yes it's tough and disappointing but you are doing great with getting two kids to UCD and the house house. Is UL or UCC cheaper, choosing your uni is a luxury even our brightest and best can no longer afford so tell her unless she eats a full scholarship she has to consider cheaper options.


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## Gerry Canning (3 Dec 2013)

Memubo;

As you will see on other threads I have (little) faith in PIPS . 
This one though looks like they will pay out a few bob , subject to their rules.

If you send me a photocopy of his PIP , I will review it for you as it seems a bit unusual? and I do not trust any pip/ppi provider.
Eg . in most cass you must claim within a few months NOT after a few months.
If you want ring me on 0872437139.
ps put 4 through college myself , phew!


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## Bronte (3 Dec 2013)

memubo said:


> . We do get a grant which covers the fees but we have to pay €460 a month for accomadation and approx €30/m to cover all bills.
> The maintainence grant of €3125 is used to cover her travel and living expenses.


 
There are max 9 months to a college year, about 40 weeks. So 460 X 9 is 4140 annually or 103 Euro's a week. Is that cheap for Dublin? How much are digs in Dublin. 

3125 / 40 is 78 Euro's to cover travel and living, but there is another 30 added to that so 108 Euro a week. 103 + 108 is a 211 weekly cost to the parents. 

If the second child is also going to Dublin, can they room share to bring down costs.

Another option is to get a moratoriium on the mortgage, to give you some breathing space, not sure if the bank would agree to that though. Kids should definitely get college jobs and in addition must go abroad in the summer to save, not to have fun, so that the parents don't go into the red for them. Not a good idea to sell the house, unless it means it works out renting in Dublin for everybody. But I imagine a decent house in Dublin would wipe out any savings. 

Is that the max grant the children are entitled to. When I was in college the people with grants always seemed to be the ones with money. No idea why the OP thinks parents are paying unlimited funds to their kids.  Where are these people, we don't meet them on AAM.


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