# Financial advice needed



## higs (30 Nov 2010)

*Age *28
*Spouse’s/Partner's age: *28

*Annual gross income from employment or profession: *€ 48000

*Annual gross income spouse: *€ 32000

*Type of employment: *Both Public Sector employees

*Expenditure pattern: *Generally non savers

*Rough estimate of value of home *€ 345,000

*Mortgage on home € *269,000- paying for 16 months 

*Mortgage provider: *EBS

*Type of mortgage: Tracker, interest only, fixed rate -*fixed 3 years

*Interest rate *3.75%

*Other borrowings – car loans/personal loans etc

Personal Loan Credit Union €* 30,000

*Personal Loan AIB € *13,000

*Do you pay off your full credit card balance each month? *No

*Savings and investments: *€5000 in credit union but tied up with loan

*Do you have a pension scheme? *Yes we both have 

*Do you own any investment or other property? *No

*Ages of children: *8 and 2  

*Life insurance: *Yes

*Net Monthly Income €* 4400

*Monthly Outgoings 
Mortgage € *960

*Credit Union €*800

*AIB €*400

*Creche € *600

*Life and Car/House Insurance € *170

*Health Insurance €*220 

*Tv/Telephone/Broadband €*160

*Diesel/Tolls € *400

*Food € *300

*Misc €*100

*Other € *300 -€500


Hi all, my wife and I are both public servants,having moved into new  house last year,got married this year.

 Initially didn't take out enough of a mortgage,this is why I received the personal loan from the bank to finish the house.

We got married this year,hence the credit union loan.

The  other refers to tradesmen and suppliers who are being paid the rest of  money owed to them in monthly installments. I owe €4000 to these  altogether,initially this was €12000. 

I could seem to manage everything up until a couple of months ago,now its all getting on top of me.

 There has been no money to pay tradesmen/suppliers the last 2 months,I just have not got it. 

Christmas is coming and I dont think I have ever been this broke. 

I  was looking at my outgoings wondering where to cut back,the health  insurance is expensive but have needed it on a few occasions during the  year regards the kids so I think its worth it.

Diesel/Tolls is expensive but I do commute to work every day.

The Creche is top class and we have no inlaws to try and involve as they are in poor health.

The  Tv/Phone/broadband is expensive,i'm in contracts up until the middle of  next year so don't know whether i can break them or not.

I have  approached both AIB and Credit Union asking them to extend the term of  loans to maybe start the five year term again but both said no as I was  making repayments.

I was thinking of approaching the EBS to maybe  take a payment break for 6 months to get my head above water,but don't  know much about them offering it to people who are making payments on  time.

Just need advice regards what to do,i am making payments  but just about at the moment. The whole thing has me stressed out and I  don't really know which way to turn.

Thanks in advance


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## goingforgold (30 Nov 2010)

Think you have a short term problem but should be fine in medium term as you both have secure jobs and debt is not too high. Can you cut back in the "other" amount. 300-500 euro is a lot. I assume this is for weddings, unexpected medical bills etc?

Are you sure your house has that much equity if it was bought 16 months ago?


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## niceoneted (1 Dec 2010)

Is there a possibility of using public transport for a few months that would be cheaper than your diesel and toll costs. 
Your tied in to the tv/broadband/phone I'd say but have shopped around for when the contract is over so you know what you want and get best deal.
What's the balance on the credit card and what repayments are you making. 
I would try the CU again. Explain to them that while you can pay now it's putting serious pressure on you and by expanding will ensure you don't go into arrears. Also just make repayments on loans don't pay into shares to for a while. 

No harm in approaching the bank. You can always ask for the payment break.


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## Bronte (1 Dec 2010)

How about asking your mortgage provider to increase your mortgage as you're well below 90%.  I assume with 2 guaranteed jobs that this shouldn't be an issue.  You then pay off the AIB and Credit union.  I would see this as a far better option than getting a payment break.  If you ask for the payment break it will look bad so don't do that yet.  In any case there are hefty penalties for breaking a fixed rate.  Why haven't you posted how much your credit card debt is?  It's worrying that you got work done by tradesmen and are only paying them by instalment.  Also the fact that you mention you are not savers is not good.  Is there a lifestlyle choice built into your debt that needs to be tackled.  On the plus side, your salaries mean you can get out of the current situation, it's the same for all us who started out married life with a mortgage and kids.  The early years are the hardiest.  Face the pain now that's what you've got to do and it will get better.  You shouldn't do the remortgage (consolidation) if your debt was built up due to life style choices that you have not curbed.


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## higs (1 Dec 2010)

we did a self build on the house,the valuer from the bank put that value on the house before we got our final draw down on the mortgage
i'm not sure if that value still stands because that value was put on 9 months ago.

The 'other' refers to paying tradesmen and suppliers that amount each month.
I have not been able to meet these for the last two months and they have been getting impatient.
 Just telling them that they will have to wait for a couple of months doen't go down too well.


With regards the public transport to work this would be difficult as I do shift work,starting early and finishing late and have a long commute to work every day.

I don't have money to meet the unexpected child/car costs that prop up from time to time. 

The short term debt seems to be crippling the finances.
Forgot to put into opening post I have a credit card debt of €1500 paying maybe €100-€150 per month off this.

Is there an option there for consolidating debts into one payment ie remortgage?
What is the max LTV offered by banks at the moment for remortgaging?
Or do they even do remortgages in todays climate?

Thanks for your replies


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## Bronte (1 Dec 2010)

higs said:


> The 'other' refers to paying tradesmen and suppliers that amount each month.
> I have not been able to meet these for the last two months and they have been getting impatient.
> Just telling them that they will have to wait for a couple of months doen't go down too well.


 
Personally I'd pay them before anything else.   I've more to say about that but as you're a first time poster I'll refrain.  

If you meet the banks criteria they may allow you to consolidate.  It will be based on your house valuation, your job situation and also how you came about having so much personal debt.


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## higs (1 Dec 2010)

First supplier owed €1200 (has received around €25000 so far) 

Second supplier owed €400 (has received over €3600

Third supplier owed €1000 (has received above €7000)

First tradesman owed €300 (has received over €30,000 waiting for him to come back and finish one small job)

Second tradesman owed €1100 (has received over €18000)

I'm not in the habit of not paying for goods/services so I have been paying these.
I just have not been able to meet them the last 2 months
that is why I posted here, i'm not looking to renage on paying people.

I contacted each person owed and explained that money was not there before house finished and they agreed on doing work/supplying goods for monthly payment. 

The two short term debts were used for finishing house-walls/gates,kerbing driveway,lawns,and wedding so nothing lavish like new cars,foreign holidays etc. 

Thanks for your advice, I checked my mortgage lenders website and I think the most LTV available is 80% which would not cover the debts based on the value of the house,but do other lenders offer more?


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## Macstuff (2 Dec 2010)

Thanks for your advice, I checked my mortgage lenders website and I think the most LTV available is 80% which would not cover the debts based on the value of the house,but do other lenders offer more

Other lenders might give a higher LTV rate but most have recently announced that they are not taking on any switchers. 
Remember this is the rate offered for new business - it could be that if you approach your bank they might offer you a better LTV rate than the one published, as you have an existing relationship with them. 
Overall, I think if you can "tough it out" you would be better off paying the personal loans off rather than consolidating them into the mortgage, it's MUCH cheaper in the long run. But of course if it's absolutely needed - do it. 

Dont worry too much about this - you are both young, have a good income and have secure jobs. Work together and you will get through it. 

Best of luck


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## RIAD_BSC (2 Dec 2010)

Bronte said:


> Personally I'd pay [the tradesmen] before anything else. I've more to say about that but as you're a first time poster I'll refrain.


 
Personally, I'd pay the banks first and put the tradesmen to the back of the queue. Tradesmen don't affect your credit rating - if you don't pay the banks so that you can pay the tradesmen, you'll do near permanent damage to your credit rating.


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## Bronte (3 Dec 2010)

RIAD_BSC said:


> Personally, I'd pay the banks first and put the tradesmen to the back of the queue. Tradesmen don't affect your credit rating - if you don't pay the banks so that you can pay the tradesmen, you'll do near permanent damage to your credit rating.


 
That's true, but OP has now explained it and he didn't order the work and not pay but instead negotiated in advance with the tradesmen who agreed to take the money by installment which is a perfectly solution to getting work done.

My coment was in that context and also based on the OP's original post which stated that the loan of 30K from the credit union was for a wedding but that has also been clarified.


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## Bronte (3 Dec 2010)

higs said:


> I checked my mortgage lenders website and I think the most LTV available is 80% which would not cover the debts based on the value of the house


 
First step is with your own lender.  You have good jobs so they may be open to 90% if you explain it properly.


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