Restructure advice needed

Hi
I have a loan from BOI taken in July 2009 for €21600 it was a restructure at a payment of €365 per month and was given at 84 months
I don’t know the rate but at this point its 12200 remaining which is strange to me as I’m 48 months in
I’m confused as it doesn’t seem I will be finished in the 36 months remaining and its obviously been given an odd/unfavorable interest rate which I want to change and renegotiate

I also have a debt with a CC at €5500 at present and I would like to top up the loan, renegotiate the term to 5 years and I’ve done online calculations for a BOI restructure loan and in needing 17500 over 60 months, it would be a repayment of 400 approx, I could even go to 48 months
Thing is my outgoings at the moment for the minimum amount to pay the CC and the Loan is 500
What can I say to the bank to get them to agree to this restructure

I have a healthy regular salary and am mortgage free but due to other expenses like travel, rent and bills, the 500 is all I can allocate to this pm and its not making a difference and holding me back.
The CC interest is only being paid and at the amount the interest is on the loan it won’t be paid for another 4.5 years?

Querybabe, do you know the interest rate you are currently paying? It should be on your loan agreement, I suggest you check there. I am guessing it is around 10.5% which is not unreasonably high.

The repayments on a loan of
€21,600
over 7 years
at 10.5%
would be €364 per month.

The amount outstanding today should be €10,900

So you will be near enough finished in 3 years at this rate.

At the moment, each payment is approximately €100 interest and €260 capital. As you pay off more capital, the interest reduces.

If you can pay only the interest on your credit card, it's a good indicator that your finances are getting out of control. You should avoid borrowing more as you will only get into more and more debt.

It would make financial sense to borrow an additional €5,000 @ 10% to pay off the credit card at 20%. But in practice, you will probably just run up the credit card debt again. So you should only do this if you are prepared to tear up the credit card.

Yes , just how or what do I say to get the money
Its classed as outside debt which they wont cover apparently I asked a good while ago
@Brendan the woman definitely said my loan was at €12200 I did think it would be closer to 10 myself I'm unsure if the interest rate is 10% or 11% and have variable have rates gone up enough over the past few years to warrant a lot less being paid off over a term rate?
Ive paid €17500 so far but there's only €9400 gone off the capital ? I dont understand this

Querybabe, there is no magic formulation of words that will guarantee you the money you are looking for. You state in your first post "it was a restructure with a payment..." So have you already consolidated debts in this loan?

With the current loan, find your original documentation and see what terms you agreed to and request a statement from the bank detailing the outstanding balance and the current interest rate. Borrowing more when you don't understand what you are currently repaying is not wise. As your repayment amount has not varied, it is possible you are on a fixed rate.

Querybabe said:

Ive paid €17500 so far but there's only €9400 gone off the capital ? I dont understand this

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In very simple terms

€21,600 @10% = €2,100 interest a year.
x 4 years = €8,000

Interest €8,000
Capital €9,800
Total €17,800

This looks about right. But get out the statements since the start of the loan and check it for yourself.

Brendan

Querybabe said:

Ive paid €17500 so far but there's only €9400 gone off the capital ? I dont understand this

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There's a tipping point in the life of a loan. Up to that point, more than half of the amount your monthly repayment is covering just the interest, the rest is reducing the principal. After that point, more than half gets to reduce the principal and the rate at which the principal reduces is accelerated.

It's generally about half way through the life of the loan. In the case of my mortgage, I could see that the quarterly interest charge was more than the quantum of one month's repayment. In fact, it also took a chunk out of a second month's repayment. About 2 years ago (20 year mortgage taken out in 2000), I could see that the quarterly interest charge had reached an amount that was less than one month's repayment so I could see more of the repayment reducing the principal.

For example

Before:
Jan Repayment 500.00
Feb Repayment 500.00
Mar Repayment 500.00
Mar Interest 650.00

In a 3 month period, I repaid 1500, yet the principal only reduced 850

After
Jan Repayment 500.00
Feb Repayment 500.00
Mar Repayment 500.00
Mar Interest 450.00

In this 3 month period, I repaid 1500, yet the principal reduced 1050.

so-crates said:

Querybabe, there is no magic formulation of words that will guarantee you the money you are looking for. You state in your first post "it was a restructure with a payment..." So have you already consolidated debts in this loan?

With the current loan, find your original documentation and see what terms you agreed to and request a statement from the bank detailing the outstanding balance and the current interest rate. Borrowing more when you don't understand what you are currently repaying is not wise. As your repayment amount has not varied, it is possible you are on a fixed rate.

Click to expand...

Since the others have posted I understand now
The reason Im asking for advise is I know what Im paying now isnt helping the overall end game which is to become debt free asap which is why I'm leading to get a restructure
Other than getting a loan from my bank, I dont know what to do.
I currently have no capacity to save for emergencies like car trouble or medical expenses even

Querybabe said:

Yes , just how or what do I say to get the money

Click to expand...

Querybabe said:

Since the others have posted I understand now
The reason Im asking for advise is I know what Im paying now isnt helping the overall end game which is to become debt free asap which is why I'm leading to get a restructure
Other than getting a loan from my bank, I dont know what to do.
I currently have no capacity to save for emergencies like car trouble or medical expenses even

Click to expand...

I do understand why you are looking to restructure debt and better utilise the repayment to clear it down but as I said, there is no magic formula that will guarantee a yes from the bank to your proposal.

The first thing I would suggest you do is cut up that credit card, it is the last thing you need in your pocket if you are determined to clear down your debt, don't be fooled into thinking you will only use it in an emergency.

The second thing I would suggest is that you post in money makeover giving more details of your situation, you say you have a healthy income but without some idea of what that means in physical terms it is hard to determine if the €500 is 1/3 of your take home or 1/5 and it is not possible to determine if your other expenses are reasonable or perhaps too high.

The third thing would be to encourage you to save a small amount, even aiming for €10 a week in savings in some way shape or form (for example bringing packed lunch to work two days a week instead of buying lunch) will allow you to get into the savings habit and build up a small fund. Just make sure you physically remove that money from your current account into a savings account or even a piggy bank - unless the money is physically removed from the pot you spend out of, you will not make the saving.

On the loan, I would suggest that you talk to the bank and see whether they are willing to extend you a new loan, I see you say you have spoken to them already regarding this but nonetheless I would start there.
Another consideration would be if you are in a Credit Union talking to them about a second loan to pay off the credit card.
Either way - do NOT take a loan to clear your credit card without getting rid of the card first - you will end up running up another debt on the credit card otherwise.