Struggling to make ends meet!

S

SMR123

Registered User
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11
Age: 31
Spouse’s/Partner's age: N/A

Annual gross income from employment or profession: E31,250.00
Annual gross income of spouse:N/A

Type of employment: Private Sector

In general are you spending more than you earn or are you saving? Spending more than I earn

Rough estimate of value of home:E190,000
Amount outstanding on your mortgage: E170,000
Payment: E868.00 inc. insurances (11 payments per year)
What interest rate are you paying? 4.39% fixed until July 08

Other borrowings:
Bank Loan: E7,500 - 245pm
CC1: E4,800
CC2: E5,200
CU Loan: E2,300 - 132 pm

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

If not, what is the balance on your credit card? E10,000

Savings and investments: E1530 CU - tied up by loan.

Do you have a pension scheme? Through work. Only paying E75 pm.

Do you own any investment or other property? No

Ages of children: N/A

Life insurance: For mortgage


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

Am fed up trying to make ends meet.
Money always runs out about 2/3 weeks after I get paid.
Have tried to move to 0% CC but Halifax not interested.
Have also gone to TSB, Halifax and One Direct for a consolidation loan, but have been refused. Got print out from ICB and everything fine...is this the credit crunch kicking in??
Am only paying min payment on CCs every month. Can't afford to pay any more.
Am renting out room in house for summer - should take in approx. E1,350.00.
Don't think second job is practical at the moment.
Would appreciate any suggestions people can come up with!
 
As often mentioned in these cases - have you contacted MABS?

Obviously you need to stop racking up further unsecured and CC debts immediately.
 
Was on MABS website and had a good read. Think it actually made me feel a little better.

Also the only reason I went to various banks to 'rack up' more debt, was to try and consolidate. Had checked out rates and repayments and it would have been less than I was paying at the moment. Most were quoting between 400 and 450 a month. And all debt would have been reducing! Leaving me with about 700 a month, and at least with that I would have been able to put by 200 or so a month to save.
 
SMR123 said:
Was on MABS website and had a good read. Think it actually made me feel a little better.
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You should consider making an appointment to talk to them in person. They can probably help if you discuss the details of your specific situation with them.
 
SMR123 said:
Also the only reason I went to various banks to 'rack up' more debt, was to try and consolidate. Had checked out rates and repayments and it would have been less than I was paying at the moment.
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While you would have been paying less than you are currently, the banks have to weigh up your ability to pay and the risk attached to your application.

At the moment you are struggling to pay your current repayments. From the feedback you've received from the banks, I'm guessing that they feel there is a substantial risk that you will/would also struggle to meet the lower payments on a consolidation loan.

While the information available on the MABS website is great, it's general information put out there for the public. If you meet with them, they can provide detailed feedback on the specifics of your exact situation. I'd certainly look at calling in to the local MABS office for a discussion on your options.

Edit: Post crossed with ClubMan
 
I don't want to risk damaging my credit rating. By contacting various financial institutions and going through Mabs about my struggle is there a possibility this will happen?
 
SMR123 said:
I don't want to risk damaging my credit rating. By contacting various financial institutions and going through Mabs about my struggle is there a possibility this will happen?
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While your ICB report is clear, any credit report (each bank/institution will produce their own credit reports based on your incomings/outgoings/savings/current debt/ICB report etc. ) will already be seriously "damaged" due to the level of outstanding debt.

Contacting MABS will have no negative effects. It's free advice and you can ignore it all if you wish. The banks etc. need never know you spoke with MABS.

Numerous requests on your ICB report can/do show up. Some lenders may view multiple searches on your report as a negative (especially if you have multiple sub prime lenders checking it), but I'm not sure how big an impact this would have when compared to your current situation (you're already a big risk for them as they feel you can't afford the repayments).
 
Just talking to MABS will have no effect on your credit rating as it will be confidential. Whether or not you decide to follow up on any advice that they give you or have them help you out in sorting out your affairs is another matter and one that you don't have to decide on immediately.

Post crossed with Satanta's.
 
SMR123 said:
Rough estimate of value of home:E190,000
Amount outstanding on your mortgage: E170,000
Payment: E868.00 inc. insurances (11 payments per year)
What interest rate are you paying? 4.39% fixed until July 08
Click to expand...

Are you claiming tax relief on your mortgage payments?
 
and have you shopped around on the insurance? I notice you lump the mortgage payment and insurance in together so I wonder whether you simply bought what your lender offered?

How long ago did you purchase your house? Is some of the debt you have built up as a result of moving in there? (In other words, is it not actual day-to-day living that has resulted in the loans and the CC debt). Why are you only renting the room for the summer? Can you make it maybe a longer term commitment? The additional income would help chip away at some of those debts.

Have you made a spending diary to see where all your money goes?
 
I took out life assurance, repayment protection and home insurance all with mortgage provider...may be time to shop around.

Only bought house 2 years ago. So not much profit to be made. Also took out 100% loan over 35 years. Had a company car at the time, but when I moved job last year I had to up my personal loan to buy a car - not much value in the car though (maybe 2k). Some of the credit card debt was to furnish house.

Haven't done formal spending diary, as there is very little left after all the major things are paid, maybe E400/500 to cover petrol, esb, gas etc.

Would really prefer not to have to rent out room permanently. I know, I know...if needs must.

Am claiming all my tax relief for mortgage. Actually rang to check I had gotten last years full allowance...just in case I was due a refund.
 
I wouldn't normally suppose to offer advice on these threads but I have watched this one with interest. The OP has offered the following information:
- Gross salary 31,250
- Unsecured debt 30,000
- House value 190,000
- outstanding mortgage 170,000

Given the above, in the current climate how can the OP possibly expect to refinance to consolidate debts? The LTV is currently 90% (& I suspect may actually be higher).
The value offered on the house would have to be taken with a pinch of salt.
The outstanding mortgage value would appear very low after 2 years of a 35 year 100% mortgage.

All indications are that borrowers no longer have access to 100% mortgages, let alone 100%+. I would suggest OP forgets about 'rent a room' and consider 'rent a house'.
Am I missing something??
 
Sorry SMR - mot what you want to hear - but a spending diary and a visit to MABS is what you need to do.

You need to bite the bullet, and curtail your spending for a while until you at least clear your credit card loans. Look at the interest you are paying on the 2 CCs every month if you want an incentive.

When you have cleared the CCs then you will be in abetter position to tackle other debts and reduce your interest payments to a minimum.

Spending diary does work and will prob save you 150+ per month
 
SMR123 said:
Haven't done formal spending diary, as there is very little left after all the major things are paid, maybe E400/500 to cover petrol, esb, gas etc.
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While you say there isn't a whole lot left after the outgoings, the completion of a spending diary will help you identify further areas where some (even small) savings can be made.

As a knock on effect, the actual task of completing a spending diary in itself will lead to (some/slight) savings as you give a little extra thought to every purchase.
 
... such as the ability to collect up to €10K p.a. tax free in rental income under the owner occupier rent a room scheme whereas renting the whole house makes the persona a landlord with all rental income assessable for income tax (albeit with the ability to write off certain expenses). In short to say that they should become a landlord with no qualification or explanation of the issues makes absolutely no sense.
 
I'm going to go out on a limb here and suggest that as the property is valued, according to the OP, at €190k, it is either a one bedroom city apartment or alternatively, located in a less-densely populated and perhaps less-sought after location (no offence). Therefore, I would again assume that the possibility of getting any where near €10k in rental income from renting a room would be a long shot.

My point, however badly made, was that needs must! OP has very high personal debt, both secured and unsecured, with repayments due to increase as mortgage rate reverts to standard in July. I have been surprised at the rather 'restrained' advice currently on offer, given the individual circumstances and similar-type threads. I would suggest that perhaps a more drastic solution might be required if the the OP is that concerned about damaging his\her credit rating. Maybe I should have suggested 'sell your house' instead. OP might find it easier to make ends meet without the financial drain that is home ownership.
 
avantarklu said:
I have been surprised at the rather 'restrained' advice currently on offer
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Like what specifically? :confused:
Maybe I should have suggested 'sell your house' instead. OP might find it easier to make ends meet without the financial drain that is home ownership.
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That's always an option. But where would they live then? And would they find rental accommodation for much less than the c. €900 p.m. that they are currently paying on the mortgage? If not then they might be better off keeping the house and looking for other options for dealing with the financial situation.
 
Bought house for E172,000 2 years ago, which was an extremely good price at the time. Located in midlands. Currently 2 houses on sale in the development - one of which is 218k, but I gave 190k as a much more conservative estimate. Not sure how much they are looking for the 2nd - think it's in the region of E190-200k (looking for a quick sale), so that's the figure I'm going on.

Also, Avantarklu unsecured debt is at 20k - not 30k as you previously stated...not too much better, but every little counts!

Selling house is not an option as far as I'm concerned.

Started keeping a spending diary yesterday, as I've just been paid. Also, rang Mabs yesterday to enquire about making an appointment for next week - couldn't confirm day as I've alot on next week. Lady most helpful, so won't be afraid going in!!

Also, following on from the advice about insurances being included with mortgage repayment. I rang ES, and will be saving almost E100.00 on my annual premium for building and contents when the policy renews next month compared with last year.
 
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