Mortgage arrears are often part of a bigger debt picture that could involve credit card bills, car finance and credit union loans. The question is often which do you pay first? A lot of people think that it is perhaps okay not to pay their mortgage because they think the bank themselves are offering grace because of the exceptional economic circumstances. Often, people pay their credit card bills before they pay their mortgage because credit cards can be seen as a form of income.

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After reading a recent Aviva mailshot I noticed a statistic indicating that annual savings out of disposable income in 2010 will be €10 billion higher than they were in 2008.

People have cottoned on to the idea of saving. My view is for people with borrowings to realise the optimum way for them to save is by accelerating the repayments on their debts, be they mortgages, credit cards or personal loans. By doing this they are effectively getting a return of the interest rate being charged on the debt, which is much higher than sticking the funds on deposit and having to pay DIRT into the bargain.

An interesting Article from Irish Independent, by Charlie Weston, headed Cannibals Rule makes for an interesting read on the subject.

Also, PTSB article in RTÉ Business News confirms savings is the new mortgage, but now the financial institution owes you the money, as opposed to you owing them the money!!!

For more information on Mortgages and Savings Advice contact Pat Nestor pat@sckgroup.ie or 01-2910800.

The banks already have one hand in your pocket.  Do not let them put their two hands in when they increase their Standard Variable Interest Rate.  Talk to us for advice on switching to a Fixed Rate today.

Do it now!