Consolidate debt

Hi,
I've only just discovered this forum and see some really knowledgeable people seem to give advice here.
I wonder if any one can give me some advice as to how best to proceed.
I took a 25 year mortgage in Jan 05 for 165,600 on a new 2 bed property I bought for 180,000.
I took a fixed rate mortgage for one year at 2.75% now reverting to 3.5% variable rate.
To secure the remainder I borrowed 14,400 from a credit union at 9.9%.This was a top up to a 9k personnel loan I had taken a year earlier.
I also took a 10k personal loan from MBNA at 9.4% over 5 years and a 12k personal loan over 5 years from BOI at 9.4% to furnish the property as I was
starting from nothing.
Right now on a monthly basis I am paying the following excluding utilities and insurances:
Mortgage: 764 (836- revenue credit of 72)
BOI : 274
MBNA : 253
Credit U: 507 (loan payment + interest + small saving of approx 20 Euro)
Total : 1798
I also have 2 credit cards with a combined limit of 14k with 2k owing on them built up since December.
I have up to now always paid these off in full each month but don’t have the money to so this month.
I have a good credit history with a maximum value deposit SSIA worth about 15,600, and 11k savings in the credit union.
I would like to consolidate this debt or at least the personnel debt to minimise monthly repayments,
but the AIB won’t refinance the mortgage as it would exceed the value of the property currently estimated at 195k.
I would like some advice on what would be my best option to reduce my outgoings?
Are there any financial institutions offering a deal that would be better for me?
Bear in mind I probably wont be an existing customer and there will be no security for the loan although in full time employment for 20 years.
Any insights would be much appreciated.

Hi,

Its a bit of a pickle ... obviously you cant go down the remortgage route yet....

I would recommend trying to secure a loan from [broken link removed] There flexible loan is brilliant, has a competetive APR and the the flexible options are a real bonus. If you read the website you will understand what i mean.

At the moment your loans (excluding mortgage) are €38,400 and repayments on these (excluding paying the credit cards) are circa €1,017 per month.

If you got a €35,000 loan from ge money you would pay €708.17 per month over five years (same length as boi and mbna loan, didnt give length of cu loan) That would be a substantial reduction in your cash outfolw.

The balance of €3,400 (ie €38,400 - €35,000) could be paid out of your credit union savings once you get the ge loan.

Then as you have a Flexible loan you can make lump sum payments FREE OF CHARGE, Increase payments etc.... You have a good ssia coming to you so that would help knock a good bit off the loan.

Finally the application would be looked on favourably if you told them it was a debt consolidation loan... (ie they will pay your loans directly thus taking the temptation of spending any of the money out of your hands)

The above would set you on the way ... word of warning live within your needs.. did you need all that money? For furniture etc? And get rid of at least one credit card if not both...

this time you will be ok but next time you never know... THIS IS YOUR CHANCE TO MAKE IT WORK!

by the way its not clear from your post if the credit union loan is €9k + €14.4k or is 14.4k in total.

Obviously if it is 9k + 14.4k = 23.4k then your total borrowings would be €47,400 which is unbelievable and in my opinion reckless lending by financial institutions!

Obviously you would then have a shortfall of €12,400 which you would have to try clear with all your credit union savings... for that total of cu loan i believe your term would be greater than five years hence the ge money option would in reality save you more on your cashflow as it consolidates all the loans over five years.

Thanks for your thoughts and the information on GE Money.
Maybe I should have said it clearer...I took an additional 14.4k but obviously had been paying already against the original 9k so the current balance is about 18k outstanding with 11k in shares. And the loan term is 5 years with one gone thats 4 left to run. 48 repayments left approx.

The money was required as essentially I bought just 4 walls, Had to do all flooring, units etc..

I dont have a problem meeting the repayments so far but obviously seeing lower rates elesewhere has left me feeling that I could get a better deal if managed correctly.

www.mabs.ie might also be able to advise you. I know that you are not yet in arrears but they are very good at advising people. They will also teach you how to budget your money.

Mimi

ivannomonet said:

Hi,
I also have 2 credit cards with a combined limit of 14k with 2k owing on them built up since December.
I have up to now always paid these off in full each month but don’t have the money to so this month.
.

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I'd recommend reading through some of the similar threads here for general advice.

You should seriously consider reducing the limit on your credit cards, it doesn't take much before it builds up. A limit of a few hundred should be enough to take care of any online bookings etc. you may need to make and apart from that you shouldn't be using money you don't have. You seem to have this attitude anyway so don't give in to temptation.

Unless you have the 0% interest or a particularly low interest rate on your credit card i would be considering clearing one and considerably reducing the other with some of your savings. I understand you may have to keep some as shares. Clear the onewith the highest APR first. If you are managing at the moment then consider using the savings on the credit card you've cleared to reduce the other. Both credit cards cleared will leave you a lot more flexibility. Credit Union loans aren't fixed so you can then look at paying that off a little sooner while putting something aside for savings. Its a harder way than the consolidation way and really depends on the interest on each debt etc. I'd second the advice to visit MABS.

mimi rogers said:

www.mabs.ie might also be able to advise you. I know that you are not yet in arrears but they are very good at advising people. They will also teach you how to budget your money.

Mimi

Click to expand...

agreed. contact mabs as they are great at helping. i know of someone who dealt with mabs and it did them the world of good.

Alex.

See the key posts threads at the top of this forum for some useful resources on budgeting and managing finances/debts.