Who to pay dilemma - Utility arrears or Mortgage

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dubdave50

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We've probably made our own mind up but who would you pay this month. Had interest only mortgage which ran out in 2010. Wheels fell off and could only continue to pay IO amount without agreement but keeping in full contact with bank, meeting etc looking for continuation of IO until next year. Informed this week that the mortgage is considered unsustainable and waiting for confirmation letter. We are in arrears with repayment plans for utilities. We can clear these up this month to avoid disconnection for the time being leaving approx €500 shortfall in what we have been giving to the bank. It doesn't help that car insurance (installment route) and road tax (3 months) are up this month either, not to mention household charge. Which to pay in your opinion?
 
How much have you available to you to use for payments and what are the amounts needed to be paid.
Perhaps the money makeover section might be a good choice for you too, to either complete the template or read some of the threads there where you might pick up some tips.

If you are at risk of being cut off with any of the utilities, I personally would give them something first to keep the utility.
 
We've been paying €1560 p.m. I.O. with no arrangement. Mortgage is more than likely unsustainable but there is a slight chance we can meet it given more time. Mortgage arrears circa €15,000 as its been accumilating since our agreement ran out. Bank declining dispite filling out MARP. Utility arrears have been stretched out and now amount to €466 (Airtricity €200 / BG €266) plus this months electric bill (bi-monthly), hopefully only €150 - €200. Income this month will only be €2800. We do regular monthly makeovers and there is not a milligram of fat to cut elsewhere. Intend appealing banks decision once we receive letter but really need to sort out utilities this time as both providers have us in last chance saloon.
 
Probably answering my own question here:

Don't pay usual amount on unagreed I.O. - Risk fail of possible appeal of MARP and commence countdown to repossession.

Pay usual mortgage - risk utility cut off and reconnection fee

My head is saying to clear utilities, pay whatevers left off mortgage interest and hope for the best. Just wondered what choice others would make
 
dubdave50 said:
Which to pay in your opinion?
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Utilities - it will take time to get you out of your house if the bank decides to go that route. Your gas and electricity can be switched off without the need for the suppliers to go to the high court !!!
 
Seems like the bank is forcing your hand regardless. If you pay mortgage you won't be able to pay arrears on utilities. Thats going to make it even more expensive to get them reconnected. If you end up somewhere else, your still going to need to deal with the utility companies, unless you can set up an account in someone elses name.

I'm not clear if paying the mortgage is going to achieve anything. But I have no experience to offer an opinion on that side of it. Hope it works out in the long run.
 
dubdave50 said:
My head is saying to clear utilities, pay whatevers left off mortgage interest and hope for the best. Just wondered what choice others would make
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That would be the choice I would make. Utilities are necessities. If your mortgage is unsustainable you are better off starting the road of letting the bank take it.
 
€1560 per month interest only ? Ouch !

MABS told me that food and heating are more important than mortgage, so utilities I'd pay.

Even if you do get repossessed you might still end up staying in your house, but as a tenant rather than mortgage payer. Or maybe even a squatter, paying no rent.
 
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