Debt Help

pauloz · 05-11-2012 4:52pm #1

Hi,

New to this, but i'm desperate for help. I'm 23, I owe 7,000.00 (600.00 in arrears but making the payments) to the Credit Union, 2 credit cards oweing 3,000.00. I have a good full time job earning 1500.00 a month. Maybe it doesnt seem a lot but I cannot sustain it. I pay 200.00 rent a month, 85 for insurance on my car, phone bill is 60.00, and all other bills. My car is about to fall apart.
I am at my witts end. I've applied to the AIB for a loan of 17,000.00 this would get me a decent car, clear all debt (and just have one payment) and have a some savings set aside. They denied it today. Is there anyone out there that can help me? Its a constant struggle, robbing peter to pay paul and still in the same situation all the time. Cant afford to save, can just about pay the bills. I've been in the same situation for a year or so. Any advice would help? Should i just come to clean to the bank and say what its for? I'm thinking of going into the bank manager and fighting my case... thanks in advance

MagicMarker · 05-11-2012 4:59pm

You have debt of 9k (I assume 3k total for CCs, not 3k each). Why are you asking for a loan for 17k? Forget about the car and you don't take a loan out to set aside for savings.

9k over 5 years will leave you plenty of money to save.

At the very least you should be asking your bank to consolidate the CC debt, assuming your CC is with the bank and not something like MBNA then they should be able to accommodate you.

pauloz · 05-11-2012 5:08pm

Thanks for the reply - CCs are with 2 different banks, It's just dificult at the moment, I don't see another option.

homer911 · 05-11-2012 5:14pm

You should also look at your expenses...

Seriously? €60 a month for your phone bill! If you are in financial difficulties, yet still paying this kind of money, you need to assess your lifestyle and what cuts you can make..

Kristopherus · 05-11-2012 5:39pm

Welcome to real life:). As Homer has already posted, you need to have a radical look at your lifestyle. You have almost borked your credit rating already with your credit card debt. As for the phone, seriously consider changing network. Have a look at www.lycamobile.ie. They piggyback on the O2 network. If you register online with them, you can get 150 mins + unlimited texts & data (9gb limit) for €5 per month. Have a look at their Offers page. There's plenty of info on them in the Bargain Alerts forum. As for buying a car, forget it. You won't get a loan from anyone to buy a bicycle, let alone a car !!!!! Harsh, but true.

chris85 · 05-11-2012 5:52pm

Sorry OP but you have it all messed up. You owe €10k in debt and you want to add another €7k to it to get a "decent car" as you put it. A good car can be got for a lot less, maybe €2k. And €60 a month for phone, I pay €15 a month on billpay with Meteor. There are plans costing a lot less.

Why would you want more debt? Maybe seek a loan for €10 from bank to clear other loans and get a lower rate on the debt.

fits · 05-11-2012 6:11pm

you really do not want a 17 grand loan. Have you any idea how long it will take to pay that back and how much it will eat into 1500 take home pay? 1500 is not a lot to live on at all.

I agree with the others, mobile phone should be MAX thirty quid a month. Switch to a cheaper contract if you can, although I am guessing you have an iphone contract...

Alllocate 300 euro a month to your loans/credit card. 200 euro for rent. And you'll have to live within your means on the rest.

Oh and cut up the card until you have it paid off. Stick 100/month by for rainyday fund.

deelite · 05-11-2012 6:23pm

I agree with everything that the other members have said. I would however go to your credit union with the two credit card statements and explain the difficulty you are in, and ask if you can borrow to clear off these two cards and reschedule your current loan.

You need to be very strict with yourself - ie., cutting up the credit cards as soon as possible, and asking yourself before you spend "do I want this product or do I need this product?". It takes determination but you can do it if you want to.

I buy 10 euro credit every 6 weeks ( I'm with Tesco mobile so I get double credit once I buy 10 euro or more credit). I've a basic phone, also I found that looking for money saving tips on websites very useful. Best of luck

pauloz · 05-11-2012 6:28pm

Thanks everybody for the advice - i guess everything is getting on top of me. I guess the loan is a NO-GO. I appreciate all the input, sitting worrying everyday, its taking a serious affect on me. I got myself into this, so i guess i have to get myself out, simple as that...

deelite · 05-11-2012 6:29pm

pauloz wrote: »

Thanks everybody for the advice - i guess everything is getting on top of me. I guess the loan is a NO-GO. I appreciate all the input, sitting worrying everyday, its taking a serious affect on me. I got myself into this, so i guess i have to get myself out, simple as that...

Can you make an appointment with MABS

pauloz · 05-11-2012 6:32pm

Is that not going to ruin my chances of ever getting alone again, as i will eventually have to get one for a new car/house...

MagicMarker · 05-11-2012 8:56pm

pauloz wrote: »

Thanks everybody for the advice - i guess everything is getting on top of me. I guess the loan is a NO-GO. I appreciate all the input, sitting worrying everyday, its taking a serious affect on me. I got myself into this, so i guess i have to get myself out, simple as that...

A 17k loan is a no go, go back to the bank about the CC debt.

cookie1977 · 05-11-2012 9:04pm

pauloz wrote: »

Is that not going to ruin my chances of ever getting alone again, as i will eventually have to get one for a new car/house...

Speaking with MABS will have no impact on your credit rating. If they come up with some ideas to help then yes these might affect it (although it may already be affected).

Get a diary and right down everything you spend money on for at least a week (if not longer). That means everything. You should then get an idea of what you're spending your money on and how to cut back.

Look also at all your bills (such as your mobile). See if you can get them for cheaper. For example I pay 15 euro a month for 200mins, 200sms, 1GB of data and free meteor to meteor calls and texts. This is not a contract plan but rather a 30 day sim only contract.

Make your lunch and take it to work and avoid take aways. Make your dinners for the week and freeze them if you can. There are lots of small changes you can make that will make a big difference to your budget.

chris85 · 05-11-2012 9:44pm

cookie1977 wrote: »

Speaking with MABS will have no impact on your credit rating. If they come up with some ideas to help then yes these might affect it (although it may already be affected).

Get a diary and right down everything you spend money on for at least a week (if not longer). That means everything. You should then get an idea of what you're spending your money on and how to cut back.

Look also at all your bills (such as your mobile). See if you can get them for cheaper. For example I pay 15 euro a month for 200mins, 200sms, 1GB of data and free meteor to meteor calls and texts. This is not a contract plan but rather a 30 day sim only contract.

Make your lunch and take it to work and avoid take aways. Make your dinners for the week and freeze them if you can. There are lots of small changes you can make that will make a big difference to your budget.

+1

I am on same meteor plan, its €5 more now with Meteor I think but still better than what OP has. €60 a month is ridiculus these days. I wouldnt spend more than €30 on a billpay plan.

Lunches for sure, make your own, I make dinners for the few days ahead so usually have something there if running late and need dinner, rather than getting takeaway.

Shop in Aldi/Lidl for food, great stuff in there. I go there and get all my meat in the butchers as best value for good quality.

Also sounds like you went to AIB looking for €17k and not told them it would be to clear other debts. This is obviously bad as if you are clearing other debts and least to them that is better than you getting the loan and not clearing them. Since you didnt tell them they assume following the loan you will owe the €17k + €10k debt you already have. Also getting €17k is wreckless. A car for €17k in your position is celtic tiger thinking.

I would talk to your CU about the situation as they tend to be most accomodating about consolidating debt so they may give you €10k to clear all your debts and you can focus on paying them only. This makes sense as the loan would have lower rate than on your credit card debt.

Debt Help

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