credit union loan or mortgage?

polly_wolly_3

I currently pay €100 per week to a Credit Union loan (€13,300) APR 11.35% with €1400 in savings in there.
I pay €200 per week to my mortgage. The monthly payment was for €781, so on an average four week month there would be an extra €19 in it, and on a 5 week month there would be an extra €219 (Does this extra money go off the overall loan amount or the interest???)
There is €206,000 outstanding on it
I'm on a tracker mortgage of 1.50% +ECB, for a mortgage which is roughly €70,000-80,000 negative equity


I'm putting in the € sign as I'm in Ireland.

• take home €2400 per week after tax
• earn between €400 and €800 per month with other income, cash in hand.
• life assurance and mortgage protection is €133 per month.
• car insurance €570 per year (one off payment)
• home insurance is €250 per year (one off payment)
• diesel is €400 per month
• shopping/groceries €250 per month
• training/golf/leisure €140 per month
• gym membership €180 per year (one off payment)
• car tax is €617 (four quarterly payments of €173
• internet €40 per month
• lunch €80 per month
• football season ticket €550 (one off payment)
• back and forward to UK for football games and visit family €200.
• Gas and electric €50 per month (when i can be bothered paying it, then the bills come in).

I have absolutely no savings at all.

Mobile phone is from work so no real bill there.
I'm sure there are more things that I could add in, think I'm a bit frightened to see any more things on that list though. Thankfully I don't smoke, have no credit card(anymore).

There are weeks when I might be going to UK for a weekend, or have a one off payment such as car insurance that I don't make my weekly payment to either mortgage or Credit Union. This would happen possibly 5-7 times over the year.


So the question is, just now anyway, do I continue paying a wee bit extra to the mortgage (due to the recent rise in ECB rates then I'm going to have to pay more in each week) or do I put any extra money into the Credit Union loan and get rid of that???
Was considering €250 per week to the mortgage and keep Credit Union as it is(as I'm typing i think it's 90 per week to loan and 10 to shares/savings).

Is there any hope for me at all????? I've never really had a value in money, in one hand and out the other. Now i'm really fed up with having !!!! all to show for my hard work

katsu

I'm confused with the mix of monthly and annual - can you separate them and perhaps set out a budget listing what you are paying out each month and should be putting by to your annual bills?

How can you avoid paying the mortgage or loan for a week?

I suggest that you work it all out and then open a separate account for the annual bills money to go in and then take it from your income so you can't spend it.

I'd overpay the loan as the interest rate is far higher than your mortgage.

Good luck.

polly_wolly_3

katsu wrote: »

I'm confused with the mix of monthly and annual - can you separate them and perhaps set out a budget listing what you are paying out each month and should be putting by to your annual bills?

How can you avoid paying the mortgage or loan for a week?

I suggest that you work it all out and then open a separate account for the annual bills money to go in and then take it from your income so you can't spend it.

I'd overpay the loan as the interest rate is far higher than your mortgage.

Good luck.

Just looking at it again, that should read take home is €2400 per month, not week (600 per week)
I avoid paying it as it gets taken out each week by direct debit, so I just take whatever money is in the bank out and then there's not enough in the bank to cover the payment, whether the 200 to mortgage or the 100 to credit union.

The annual or one off payments I had above calculated in months

• car insurance €47.50 per month
• home insurance is €21 per month
• gym membership €15 per month
• car tax is €51.50 per month
• football season ticket €46 per month.

The reason I mixed it up a bit there is I try make one off payments rather than tie in to standing order/direct debits.

Tixy

Its good to build up a full monthly budget and to make sure you budget for those things that you spend annually or not every month and to include things like a budget for presents, haircuts etc.

It might be handy to fill in the statement of affairs calculator to make sure there are not any costs you've forgotten to budget for. http://www.makesenseofcards.com/soacalc.html

I'd agree with katsu that at the moment I'd make any overpayments off the loan (I assume you can make overpayments with no penalty as its a credit union loan). Maybe if interest rates rise in the mortgage a lot then I would think about putting some of it to the mortgage. What is your house value compared to mortgage? do you have equity? if you were in neg equity then I might focus on the mortgage instead.

polly_wolly_3

Thank you. House is in serious negative equity, over 50k anyway. sometimes i feel like just giving the keys back to the bank and changing my name.
The CU loan is a fixed rate (i think) and will be there for the next four+ years if I keep paying as I do. Would it be better for me to just pay any extra money into that and get rid of it? I make a point of paying even a little extra to both, but would like to increase the payment by say 30-50 per week and wondering would it be better if i made the payments to one of them or to both??

Its just really frustrating at the moment and I've never asked for advice.