# Debt in dire straits, need a consolidation solution



## moody blues (13 Jan 2009)

In serious crap:

Am a high income earner, stressful job though, PAYE, however, have 3 Euro loans o/s bal = Euro 76k, and 4 GBP Loans outstanding bal = GBP 57k. Never defaulted or went into arrears etc.

*Age:*
33

*Spouse’s/Partner's age:*
31 - recently unemployed

*Annual gross income from employment or profession:*
E82,000 after pension contributions + inc Co Car BIK adjustments

*Annual gross income spouse:*
E0

*Type of employment:*
Private sector employees

*Expenditure pattern:*
We are both generally 'savers' i.e. no extravagent lifestyle but bad investors in hindsight

*Rough estimate of value of home*
E270k currently from 380K 2 yrs ago
*Mortgage on home*
E340k - equity withdrawn for UK investment
*Mortgage provider:*
IIB
*Type of mortgage: Tracker, interest only, fixed rate*
Fixed for another 18 months
*Interest rate*
5.09% 

*Other borrowings – car loans/personal loans etc*

Outstanding Euro Loan Balances
23k 10 yrs 335/month - 9%
26k 5 yrs 630/month - 6.9%
27k 10 yrs 320/month - 6.9%

Outstanding GBP Loan Balances
11k 7 yrs 292/mt - 5.9%
7k 5 yrs 152/mt - 6.5%
23k 10 yr 250/mt - 8%
16k 10 yrs 227/my - 6.7%

E1450.00 in Mortgage repayments (Int only)

GBP 715/mt less net rent GBP 515 = negative cashflow of GBP 200 (property in negative equity of 60k approx)
GBP 732/mt less net rent GBP 465 = negative cashflow of GBP 267 (abt 30k in equity if able to sell)
+ GBP 300/month of management co fees inclusive

Therefore Total outgoings:
Euro outgoings = 2735/mt
GBP outgoings = 1688/mt (E2k approx on current exh rates)

*Do you pay off your full credit card balance each month?*
Normally but currently 5k balance

*Savings and investments:*
GBP15,000 to cover UK repayments shortfall this year

*Do you have a pension scheme?*
Contributory Co Scheme

*Do you own any investment or other property?*
Yes, 

*Ages of children:*
None.

*Life insurance:*
No.

*What specific question do you have or what issues are of concern to you?*
Currently have a negative cashflow every month before food, ESB etc etc

Can't seem to cut a break from the debt trap - would like to get a single loan consolidation for the Euro loans at least, over 10 years, in order to assist with cash flow. 

Loans were used for investments that haven't gone well in UK. 

Anyone know of a way out?

Is handing back keys of house an option when still working?


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## Bronte (13 Jan 2009)

Can you do the money makeover section as it's difficult to understand your post.  This will help you to get some proper advice.


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## CGorman (13 Jan 2009)

Bronte said:


> Can you do the money makeover section as it's difficult to understand your post.  This will help you to get some proper advice.



Yeah, a clear list of income and expenditure is necessary to give more constructive advice/opinions.


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## anon473 (13 Jan 2009)

I had never heard of the phrase "handing back the keys" until this site.
http://www.askaboutmoney.com/showthread.php?t=90807 discusses it and the consensus is that it is not an option

do post your full details - your level of debt only has meaning when we know your levels of income, outgoings,  assets and liabilities.

anon473


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## moody blues (13 Jan 2009)

updated now


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## Bob_tg (13 Jan 2009)

moody blues said:


> have 3 Euro loans o/s bal = Euro 76k, and 4 GBP Loans outstanding bal = GBP 57k.



If we assume 1 EUR = 1 GBP, other than your mortgage, *can you please confirm your net debt is around 122k?* (i.e. 76k + 57k + 5k credit card less your 15k investment?)

Also, there is still more information needed, for example:
- how much are you paying in to your pension each month?  
- are you paying health insurance (e.g. VHI)?  
- have you any cars other than your company car?  How much are they worth?
- have you any other commitments/investments not mentioned below?


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## moody blues (13 Jan 2009)

Yes, if 1 Euro = 1 GBP Net Debt = Euro 123k exc Mortgages
No other Cars
Net Sal = 4500 after pension & Co Car.
Other Costs approx 1500 per month on Food, VHI, ESB, Gas, Sky & Gym (sky & gym being only luxury, if you'd call them that...!!)


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## j26 (13 Jan 2009)

Is your partner entitled to redundancy, or Job Seekers Benefit.  
If there's a lump sum available, you might consider applying it to the highest rate loan, and try to negotiate better terms.


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## moody blues (13 Jan 2009)

She is on unemployment assistance, no redundancy, has abt 5k left in savings.


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## mercman (14 Jan 2009)

moody -- if you group all your euro loans together and bring them to the one Bank, say KBC (IIB) they should facilitate you as you have never been in arrears and as ahigh earner are the type of customer they want. Try the same with your sterling loans. This should facilitate all matters into a loan with lower repayments each month.


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## moody blues (14 Jan 2009)

thanks Mercman

I tried this with Anglo & Dankse aabt 12 mts ago, but could see at that stage the credit boom had bust, they all wanted security up to the value of that amount, before I think it might have been easier.

Do you know if IIB do those kind of loans unsecured or would they also give me the security thing? Is there a specialist section that would deal with this kind of loan?

Re: UK Loans, do you know of any providers that would consider this?

Thanks


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## Bronte (14 Jan 2009)

I still find it difficult to read, would be better if you just converted everything into Euro, especially to see if your investments make sense.  Also what are the UK investments.  Anyway the positives, you are young and have a good salary and no kids.  Is IIB subprime?  If so try not to consolidate with them.  You say you always pay the credit card balance but this is not so if you have a balance of 5K.  If you are living beyond your means then you need to take action such as cutting up the credit card, getting rid of sky and the gym, and yes for you they are luxuries.  If you do not manage to consolidate and you make savings then after the credit card I'd be throwing as much money as you can at the 9% and 8% loan.  You are at a good time for interest rates so 9% is way too high.  You also ought to clarify the remark that you are a saver when you have so many loans.  How did you arrive at having so many loans.  (what were the loans for)


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## mercman (14 Jan 2009)

Bronte said:


> Anyway the positives, you are young and have a good salary and no kids.  Is IIB subprime?



What a ridiculous remark !!!! Since when is having no Kids a positive ? There are persons in the world in far worse conditions and are delighted to have children. And there are many women who are unable to have them and would give everything to be aable to have adopt foster etc.

IIB Bank are the same as KBC one of the largest Banks in Europe. They will view the matters with  an open mind on the entire situation. As long as no payments missed in the past they are more likely to assist you.


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## BoscoTalking (14 Jan 2009)

mercman said:


> What a ridiculous remark !!!! Since when is having no Kids a positive ? There are persons in the world in far worse conditions and are delighted to have children. And there are many women who are unable to have them and would give everything to be aable to have adopt foster etc.


and this couple are not those people and they do not need any dependents at this point in time and debt. get off the horse before you get altitude sickness


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## mercman (14 Jan 2009)

- That's about the most suitable reply for you Pennypitstop.


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## MeathCommute (14 Jan 2009)

Mercman, nobody said that kids aren't a blessing. You need money to provide for them though


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## Yaffle (14 Jan 2009)

Assuming your PAYE in Ireland, have you transferred your wife's tax credits and standard rate cut off to your tax payaments? Are you claiming all your tax credits? for example, bin credits, private health insurance They might only be small amounts but when money's tight every little helps.


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## Mommah (14 Jan 2009)

Could you sell a share in what I presume are buy-to-let properties in the UK? For example sell a 50% share at current market rate (ie a loss) and pay off some of the mortgage? The buyer would probably have to be a friend or family member.

Are you doing interest only on these ?properties...if not could you negotiate that...would be in your current providers interest especially if you are in negative equity....or else negotiate increasing the term of these UK mortgages to reduce the monthly cash flow issues.

Increasing the rent is not generally an option in the Uk at the moment..in fact you are probably lucky if your tenants don't ask you for a reduction.

The other option is to increase your income, somehow...extra job etc.Wife get some sort of job ASAP....childminding, after school pick ups etc etc.

Sterling is weak at the moment so your UK problem is likely to get worse if sterling strengthens.

You certainly have to batten down the hatches re sky and gym..although getting out of a gym contract mightn't pay off...but don't renew.


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## moody blues (14 Jan 2009)

Thanks for reading & comments.
Re: expenses, take it from me I have done them all bar sky & gym, i.e. interest only, terms, tax reliefs etc etc.

No wife, just girlfriend - claiming her tax credits isn't an option, girlfriend, not wife. 

Without sounding appreciatative, my primary query is on unsecured consolidated loan providers for large debt in order to facilitate cashflow.

Equally, for anyone without these type of debts issues, its easy to say & see rates have come down etc & draw conclusions from that. Rates are not the problem in the world of dried up credit, liquidity is, therefore, banks will charge premiums on loans, mortgages etc above and beyond the norm as the wholesale rates are higher & because banks need as much cash as they can hold onto or make in order to repair their balance sheets etc.

Please no more suggestions on the penny pitching savings of a bill or two, I have cut back as much as I can, exc sky & gym, as I say my main question is on a consolidated loan providers for large debt in order to facilitate cashflow, to someone with an excellent credit history, rather than saving a tenner here or there. 

Re: Credit Card, I have for donkey's years always cleared them, only very recently did the balance climb up, its my number 1 target.

Re: Loans purposes - I arrived at the property game too late, and then let it go higher and higher, never able to get on, working my socks for for that pay rise, year on year, to get on the ladder & then used loans to fund other property purchases - 1 here and 1 in UK. Had other apt in UK earlier, as I lived & worked their for a no of years. Came home to motherland & got nailed on the property boom bust scenario.


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## D8Lady (14 Jan 2009)

Could you detail which of the loans detailed above are credit cards and are bank loans. 

You could consolidate your credit card balances to a 0% rate card. 
As it is your priority, any payments would be used to clear the card without paying interest. That would free up some cash to tackle the rest of the loans.


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## moody blues (14 Jan 2009)

Thanks,

I did - 5k credit cards, 123k unsecured personal loans.

I take ur pt on cred card transfer.


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## capall (14 Jan 2009)

I am trying to understand your initial financial planning
You just have 2 UK investment properties ?  With negative cashflow of under 500gbp/month on these ? You have personal loans of over 2000/month related to those property investments plus the additional equity you drew down on your own house
How could the rental income ever have come close to covering those borrowings ? Am I missing something ?  
You ask about handing back the keys,how would that help you much ,it would just save you the 500gbp/month  shortfall on the mortgage


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## D8Lady (14 Jan 2009)

Ok, depending on how much you can pay off per month, you could have 21 months interest free on your current balance by switching cards before the interest free period is up. 


1. Tesco  0%  for  6 months.  14.9%APR
  [broken link removed] 0% for 10 months. 14.9%
  [broken link removed]  0% for  5 months.  10.5%APR


This will work assuming that no new debt is added, no cash advances taken.


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## Bronte (15 Jan 2009)

mercman said:


> What a ridiculous remark !!!! Since when is having no Kids a positive ? There are persons in the world in far worse conditions and are delighted to have children. And there are many women who are unable to have them and would give everything to be aable to have adopt foster etc.
> 
> IIB Bank are the same as KBC one of the largest Banks in Europe. They will view the matters with an open mind on the entire situation. As long as no payments missed in the past they are more likely to assist you.


 
??? Mercman were you feeling all right yesterday.  I'm only trying to be a bit positive in relation to people on here in relation to debt because sometimes I can be too negative and the fact they don't have kids means they don't have creche fees, clothing, sports and all the associated items that go with having kids.  It was absolutely nothing about whether one should/could have kids.  In relation to IIB (I know KBC) I just got the impression that people went to them when mainstream banks turned them down but obviously I was incorrect.


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## Bronte (15 Jan 2009)

moody blues said:


> Without sounding appreciatative, my primary query is on unsecured consolidated loan providers for large debt in order to facilitate cashflow.


  In order to do this we need to know exactly what you own, it's current value, it's mortgage and it's loans.  How much you receive in rent, and how much you pay in charges etc.   You keep giving information in dribs and drabs.  It wasn't until your 2nd last post that we discovered you had 2 properties.  Can you redo the moneymakover with ALL information.


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## dontaskme (15 Jan 2009)

as I understand it, you have two motgages for two UK properties, neither of which is covered by the rent, plus 120k in unsecured personal loans, plus an interest only mortgage that is 70k more than the property i.e. 70k negative equity.  TBH, I hope you're a troll as otherwise you're in a hole.  Your UK "investments" are costing you money, that could be better employed paying your other debts. What would happen your cashflow if you sold the Uk properties? That could also free up the 15000 you have earmarked fo this years losses.  Because you are cash flow negative on the properties, they are as bad as additional debt.


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## mercman (15 Jan 2009)

Bronte said:


> ??? Mercman were you feeling all right yesterday.   In relation to IIB (I know KBC) I just got the impression that people went to them when mainstream banks turned them down but obviously I was incorrect.



Bronte - Point taken. Sorry for being so pig headed. Regarding KBC they are much more fussy than the mainstream Banks. An enormous Bank. So much so they make the big boys here look like their petty cash boxes. However if one has proved themselves as honourable, they are likely to be flexible.


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## PaddyW (15 Jan 2009)

I can back up that statement on IIB, they are extremely fussy. Took me over a year to get my mortgage with them, and it was only a teeny one compared to some mortgages I see!


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## pytelium (14 Jun 2009)

there are at least 2 credit cards in ireland that offer 0% on balance transfers..one for 6 months and 9,5% after..the other for 10 months and 14% after..

open one of these ..dont use the card then..just try to pay it off as quickly as possible..


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