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Financial problems so bad i cant cope.

  • 05-01-2009 1:14pm
    #1
    Registered Users, Registered Users 2 Posts: 166,026 ✭✭✭✭


    I tried to look for a financial forum but couldnt find one so hope its okay here?

    My finances are really stressing me out at the mo and I cant cope with all the debts Im in. I got out a student loan when I first started college of €6000,my course was a really long course which I didnt like doing and eventually dropped out without finishing a few months back. When I got out my loan (AIB) I was told that It was intrest free until I finished my course. However, this is not true. I have been charged €300 euro intrest each month since I got it out, so now I owe €15,000 to the bank by the time I pay it all back in 2015.

    Of course I dont mind paying back the loan but its the fact that i have to pay back €9,000 that I didnt even have or spend, that is just really frustrating me. To make matters worse is I have another bank (BOI) threatening to take me to court because I owe them €2600, which has now gone up to €5000, for a credit card payment and travel loan.

    Anyway, so I've been struggling to find work since I left college, but manged to get a job where I get approx €1100 a month. €300 of this goes on my first loan and €200 on the second and this month I've been charged €35 intrest charge by each bank on top of that for some bizzare reason. I also have to pay €300 rent to my brother each month. This is leaving me with €300 to live on a month,.
    However, I am not working in January and I cant find any work.I have been in everywhere to look for one,also my current job ends in May. I just dont know how I am going to cope financially.

    I have spoken to both banks and said that I will pay back the loans asap but I really cant pay it back at the rate they want me to pay it back. I have asked them to extend the loan period, so I have lower monthly payments and they both refuse to extend my loan. I have asked AIB for a loan so I can pay back BOI and just consolidate all my loans into one, but they refused.

    I think that what annoys me the most is I am a capable and intelligent person. I have lots I can give to the world.But Im in massive debts now for at least the next 8 years of my life. I cant save up for anything because I have no money. Its all getting a bit too much and I really cant see a light at the end of the tunnel. My parents are giving out to me non stop and I feel like a complete failure.

    I really need some practical advice on how to deal with these problems. Is there any way I can maybe consolidate all my loans into one so Im just paying back one bank each month? Someone mentioned to me the credit union to get a loan to repay both banks,but I really just cant face going in to them grovelling if theres just no hope?
    I am starting to think being taken to court is probably the easiest option,I have tried to be reasonable with the banks and say I will pay back the loans at a low remonthly payment but they say I have to pay it back now!

    Any advice would really be much appreciated


Comments

  • Closed Accounts Posts: 1,031 ✭✭✭petethebrick


    What sort of loan did you take out??? You're basically saying that you're being charged between 100-150% interest :eek: You gotta know that's just crazy. Something doesn't add up.......


  • Closed Accounts Posts: 375 ✭✭Cantoris


    Would you consider going back to college and see if there is a part time job you can get. Lousy time to be looking for work I know but there is prob more part time work available now then before as business cut full time staff hours. The bank will then be able to see that you are making the effort. At the moment they have nothing to go on. Are your parents in a financial position to support you? Can you move back home so you don't have any rent? The banks will not want to take you to court. You have no assets from what you say so it doesn't help them at all. Also, how long have you the loans for and what is the course?


  • Registered Users, Registered Users 2 Posts: 8,584 ✭✭✭TouchingVirus


    I don't know if this is the right course of action, slap me on the wrists or warn me if it's not mods ;)

    There's a load of friendly helpful people at http://www.askaboutmoney.com - it's like boards.ie for money things like tax, debt, banking etc etc. I daresay some of the people there will be more equipped to deal with your problems and offer some sound advice.

    I do hope it works out for you OP, I don't envy your situation


  • Closed Accounts Posts: 4,662 ✭✭✭Trinity


    What sort of loan did you take out??? You're basically saying that you're being charged between 100-150% interest :eek: You gotta know that's just crazy. Something doesn't add up.......


    Yeah that doesnt sound right at all. :confused:


  • Closed Accounts Posts: 23 Niamhy21


    Defo post on askaboutmoney as suggested above. I was in a similar situation and posted here for advice. I got some great advice that helped me control my finances and to clearing my debt

    Also, you should look up www.mabs.ie. they will be able to go to the banks for you and negotiate how you will pay back the loans.

    Best of luck


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  • Administrators, Business & Finance Moderators, Society & Culture Moderators Posts: 16,957 Admin ✭✭✭✭✭Toots


    Sorry to hear about your situation OP. First thing I'd say is get in touch with MABS and see if they can do anything to help you. Have you still got your loan agreement for the loan you took out with AIB? If so, pull it out and see what it says about the interest free period. Even if it's not interest free €300 a month interest on a €6000 loan is extortionate!! What rate is it at? There's definitely something wrong there!! Are you sure it's €300 per month interest? Would it be possible that your monthly repayments are supposed to be €300 per month? You may be able to argue somehow that you were mis-sold the loan, however you will probably need to prove that you were informed it would be interest free. If it says this in the loan agreement, then that puts you in a more favourable position, however if it was just verbal information, then you will have a harder time proving it.

    As regards consolidation of your loans, it might be difficult to do that because with the current climate, banks are reluctant to take on other bank's debts. Getting a loan from the credit union may well be a good idea, if just to pay off the BOI loan and save you from going to court. Have you got savings or anything with the CU, because AFAIK, some of them will only lend to you if you've got money with them, and then they'll only lend you a certain multiple of your savings (I could be wrong on this though). It's a pity your parents are being so unsupportive, if you can manage it, sit down and have a chat with them and explain that this is a hard enough time in your life without them making it worse for you. Hopefully they'll cop on.

    Hope this has been of some help to you OP. I'd recommend posting this up in the Banking, Insurance & Pensions Forum, you'll probably get some good advice from the lads there. Best of luck to you.


  • Registered Users, Registered Users 2 Posts: 68,317 ✭✭✭✭seamus


    There's definitely something wrong with that loan. For a start, it's generally not possible to take out a personal loan for a period longer than 5 years, so I've no idea how you've ended up paying it back till 2015.

    Student loans generally aren't "interest free". They're interest free insofar as you don't pay any interest in the first couple of years, but the interest is still clocked up and lumped onto the loan at the end.

    Even so, that interest sounds completely wrong. €300/month interest is 60% interest/year. That's not legal.

    I would imagine you're getting confused somewhere and you're mixing up what things are and are not costing you. Put simply - there is no way that your loan is costing you that much unless you went to loan shark.

    As others have said, talk to MABS, though I hear they've a big waiting list these days. If you have a close family member or a friend who knows at least something about money (an accountant would be ideal), perhaps ask them to take a look and see what you're getting wrong and where you can make improvements.

    Also, without compounding your problems, €1,100/month is just over €13,000. Minimum wage is €18,000 so you're clearly selling yourself short or not doing enough hours. You're in a tight spot - try and get whatever work is going. McDonalds, Burger King, Dunnes Stores, whatever you have to do to make money.


  • Registered Users, Registered Users 2 Posts: 166,026 ✭✭✭✭LegacyUser


    Cantoris wrote: »
    what you say so it doesn't help them at all. Also, how long have you the loans for and what is the course?

    I got the loans out in 2004 for the AIB one and 2006 for the BOI one.The course I did was medicine, so the banks were just thowing money at me at the time.

    I've really looked everywhere for another job. I have been into every Tesco and Maccy D's in Dublin and each time they laugh when they see my CV,as I had very good summer jobs working in hospitals,dental clinics,along with five years of medicine as my education, probably puts them off a bit hiring me. The only job I could get was a part time position working with people with disabailites.I have applied for other positions but I am either overqualified or underqualified for them. I guess I am lucky because at least I have some sort of work,instead of being stuck on the dole.

    As for the 300 per month intrest I too was shocked,but this is what the lady in AIB told me last week when I went into the bank in an attempt to restructure it. This is why she said my repayments have to be high,to match the intrest. I have long lost the original loan agreement,can I ask AIB to get a copy of this? myabe they charged me higher intrest because I was a medical student?

    Oh and I made a mistake,its 2013 and not 2015 when my loans will be repayed by. My parents are quite well off but will not help me. All my brothers and sisters had to pay back their students loans without help from them and so they wont help me out either.

    Theres some great advice on here anyway,il check out MABS and that other website.


  • Closed Accounts Posts: 20 mutualismo


    If you did medicine then you probably had good Leaving and Junior Cert results. If you are still strong enough at some subjects (particularly maths and the sciences, but any of them will do), then maybe you should consider giving grinds. €50 hourly fees are possible if you can give off a good impression to parents, and €40 is baseline. Placing attractive ads in as many places as possible should land you plenty of phone calls. Since you are already working part-time at the moment, there's probably nothing to stop you giving at least 1 grind per day (though you might need to invest in a bike in order to travel to the students' houses. I hope you live in a city where demand for grinds is strong.)

    Alternatively, think of what other services you would be capable of providing directly to people. Given that we are in a recession, most currently existing businesses are struggling to maintain their staff levels. Many of these businesses will cease to exist over the next 5-10 years, to be replaced by other businesses which better reflect the changed economic conditions. If you are a smart and capable person, there must be services which you would be able to directly provide to people. Grinds strike me as the most obvious but there are probably others.

    I'm not qualified to give anyone financial advice. These are just my personal opinions. I believe that there are far too many people who rule out self-employment unnecessarily.


  • Closed Accounts Posts: 13,252 ✭✭✭✭Madame Razz


    Surely with 5 years of medicine done there is some avenue within the health service you could explore??

    Nurses aid or whatever?? Working as a counter assistant in a pharmacy?

    I'm just curious tho, after 5 years of very hard slog, why did you leave your course??

    Grinds are a very good idea btw, with 5 years of med you could give grinds to your younger counterpaarts, science students and of course a myriad of second level subjects...


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  • Administrators, Business & Finance Moderators, Society & Culture Moderators Posts: 16,957 Admin ✭✭✭✭✭Toots


    I have long lost the original loan agreement,can I ask AIB to get a copy of this? myabe they charged me higher intrest because I was a medical student?

    Yes, you can get a copy. The banks have to keep the loan agreements, so you can formally request a copy from the branch. I've never heard of a levy being applied to certain course types, AFAIK that'd be discrimination and they wouldn't be allowed to do that. TBH, it sounds like the lady in AIB was talking out of her arse when she told you that there's €300 per month interest due on that loan. That's roughly the monthly interest figure on a mortgage, not a 6k loan!!! If that is the figure you're being charged, somebody's made a serious cock up somewhere along the line. Is there anyone else in that branch you could talk to about that loan to see exactly what the story is?


  • Registered Users, Registered Users 2 Posts: 380 ✭✭Reflector


    . When I got out my loan (AIB) I was told that It was intrest free until I finished my course. However, this is not true. I have been charged €300 euro intrest each month since I got it out, so now I owe €15,000 to the bank by the time I pay it all back in 2015.
    Any advice would really be much appreciated


    This sounds really dodgy, I mean if they gave you an impression that it was interest free than it was, did you read the loan agreement at the time. you are a well educated person but you sound like you are second guessing yourself. See if there is any recourse in pursuing them in the case that they gave you a loan under false pretenses if it is the case that the loan agreement says that interest would be charged. I know that whilst I was in college there were those loans available and especially in 2004 and you were doing medicine so they probably would have given you doubole that amount.
    I really feel for you and hope that it works out.


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