Consolidate debt? Sell? Remortgage?

B

Banner88

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Age:
40
Spouse’s/Partner's age:
38

Annual gross income from employment or profession:
133000
Annual gross income spouse:
0

Type of employment:
Public Sector

Expenditure pattern:
Plan to save but kids and house seem to eat into those plans.

Rough estimate of value of home
E350,000
Mortgage on home
E210,000

Mortgage provider:
Home Loan

Type of mortgage: Tracker, interest only, fixed rate
Fixed

Interest rate
3.5%

Other borrowings – car loans/personal loans etc
Loan 1 - 2996 @ 108 monthly
Loan 2 - 3793 @ 108 monthly
Loan 3 - 7876 @ 184 monthly
Over Draft - 6k
Car 1 - 304 monthly
Car 2 - 464 monthly

House throws up issues that we have borrowed to get sorted.

Do you pay off your full credit card balance each month?
No credit card. One overdraft - not cleared

Savings and investments
0 savings

Do you have a pension scheme?
Yes, DB scheme

Do you own any investment or other property?
No.

Ages of children:
3 - age 6,5,3

Life insurance:
Yes.

What specific question do you have or what issues are of concern to you?

Struggling to clear debt but have never missed any payments and have money left over at the end of the month but life happens the following month which wipes it out.
Also our home is in need of renovations due to damp/ventilation issues and need more space for the kids. Have thought about renovating or selling and moving (frees up equity in home) but not sure how best to position ourselves quickly to either make a move or renovate as house is getting worse and kids getting bigger. Should I consolidate loans? Equity release to clear loans? Remortgage for renovate&extend (approx 200k)? How would a financial institution look at this?

Any advice really appreciated - thanks
 
If you are earning €133k and can't manage, it suggests that your expenditure is out of control.

You need to address that.

Consolidating loans or any other form of financial engineering will not fix your problem.

Brendan
 
Do you have a budget in place? Your borrowing outside your mortgage is high. Moving house is expensive. You value your house at 350k. Would you reasonably be able to find something cheaper and bigger?
Where do all the loans come from? What were they used for? With your wage, no childcare and a reasonable mortgage, your finances as described don't make sense. Life happens for everybody. Some have it easier than the others but still.
Money diaries are useful and I would strongly recommend using one to review all your expenses.
 
There’s not much info to go on but are two cars essential? Assuming you have equity in the car, you could double your loan repayments, probably make a dent in the overdraft. Paying off the loans from the smallest to the largest would give a good psychological boost.

In general you don’t have an income problem, you have an expenditure problem. Track spending, make a budget and stick to it!
 
Have a look at Dave Ramsey's baby steps and see if they can help.
On 133k paying 1150pm on loans should not impact that much. It may be a case of monitoring your spending to see if you are overspending anywhere.
Consolidation the non mortgage debt can help but needs to be looked at in a wider guise. It needs to be a way out not a reason to reborrow down the line.
 
I think the unsecured loans are indeed the problem.

Even with wife’s tax credits a PS worker on €133k is clearing under €6k a month. Mortgage plus other lending is €2.5k or so. Most people are going to hurt with 40% of income going on loans.

For sure lifestyle changes are needed but OP is also paying a lot of interest on unsecured loans and some restructuring would help.
 
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