Debts getting out of control

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casperjack

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Hi

I was wondering if anyone could offer the boyfriend and myself some advice on what would be the best solution to our debts.

Debts are:
(1) Boyfreiend - credit union loan of €19,000 ( from his younger days) he is paying €135 per week. Approx 3.75 - 4 years left on loan
(2) Joint credit union loan of €22,000. Paying €115 per week. End date of October 2010. (taken out for house deposit and furniture)
(3) Me - bank loan of 2,500. Paying €110 every fortnight. End date of November 2006.
(4) Mortgage of €155,000. Paying €645 per month. Only started in September 2005.

Any suggestions greatly appreciated.

Has anyone used MABS. Did you find them useful. Do you think we should contact them or try and get one loan to cover all debts from a bank?

Casperjack
 
Would you feel comfortable consolidating your joint loan with each others personal loans?

Can you cut back on discretionary spending to increase loan repayments?
 
Have you checked the budgeting/debt resources linked at the top of this forum?
 
our mortgage is double yours by the way so see the positive's too while taking charge of your bills - it could be a lot lot worse!
As far as i know MABS is free so i would get some free advice and see what they come back with. Then after that i reckon Eddie Hobbs is as good as any for the advice - tune in next week. I am always wary of banks - they are not there to help you.
Sorry to have to be negative but i think you will have to plod along for the next year and gradually you will come to finish on them one by one. You can finish your loan and start overpaying the CU loans if you could to finish them off sooner than 2010.
 
Hi Casperjack,

€135 per week on your boyfriends €19k C.U. loan seems steep if you are paying €115 per week on your joint C.U. loan of $22k, is he making extra payments in advance?

At the moment you are paying roughly as follows:

Boyfriends C.U. 135
Joint C.U. 115
Bank Loan 55
Mortgage 645
Total 950

There is lots of talk these days of re-financing over longer periods which is fine if there is no other way. However, if it is just some breathing space you want, you could re-finance your €2.5k bank loan into your boyfriends C.U. Loan and put the repayments over 5 years. That would give you a similar repayment as your joint C.U. Loan and change your situation to approximately the following, freeing up €77 p/w (€4k a year);

Boyfriends C.U. 113
Joint C.U. 115
Bank Loan 0
Mortgage 645
Total 873

The big advantage here is you will have these debts paid off in five years (with the exception of the mortgage) and you haven't spread them out over the life or your mortgage.

You could also consider amalgamating the loan you took out for the deposit into your mortgage (it was for the house anyway) and thereby avail of interest relief if the property value has increased sufficiently. This would free up approx another €80 p/w.

But I also agree with Nelly, you have to plod alog and pay these debts. You don't want to be the person who re-finances all their debts into a mortage and then takes out new loans anyway and finds them selves in the same situation in three years time.
 
Thanks everyone for all the replies. I think you are right. We would be better off trying to pay off all our loans bit by bit, instead of trying to get a top up on our mortgage. We have to learn how to manage our money day to day instead of borrowing all the time.

Think i'll do a spending diary to see if there is any areas we can cut back on.

Casperjack
 
casperjack said:
Hi

I was wondering if anyone could offer the boyfriend and myself some advice on what would be the best solution to our debts.

Debts are:
(1) Boyfreiend - credit union loan of €19,000 ( from his younger days) he is paying €135 per week. Approx 3.75 - 4 years left on loan
(2) Joint credit union loan of €22,000. Paying €115 per week. End date of October 2010. (taken out for house deposit and furniture)
(3) Me - bank loan of 2,500. Paying €110 every fortnight. End date of November 2006.
(4) Mortgage of €155,000. Paying €645 per month. Only started in September 2005.

Any suggestions greatly appreciated.

Has anyone used MABS. Did you find them useful. Do you think we should contact them or try and get one loan to cover all debts from a bank?

Casperjack
Click to expand...

Try and over pay wherever you can... and as loans clear off (eg. the 2.5k) start paying the payments from that straight into the other loans...

How much is the house worth now ? Was it a 100% mortgage ?
 
Call in Eddie Hobbs ;)

It's worth talking to MABs you have nothing to lose.
 
the comment regarding mabs is a good one. i have heard that they are very good with such issues. they will be able to help you make out a budget. they will even help you deal with your creditors.

Alex.
 
I've never had to use MABS (thank god!) but they are fantastic for people in difficulty like yourself. They sit down and go through all your monthly outgoings and work out a plan to pay back your debts in a reasonable and rational manner. They actually set up a direct debit AFAIK which will go out of your account once a month and will feed in to all your debts. Have you looked at their website? Contact them, you have nothing to lose and a lot to gain. Good luck :)
 
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