Money Matters. Ulster Bank s no nonsense guide to: Managing Debt

Transcription

1 Money Matters Uster Bank s no nonsense guide to: Managing Debt

2 Money Matters contents Sections 1 3 Understanding debt Section 4 How to manage debt Sections 5 6 Sections 7 8 How to get in contro of debt How we can hep? Section 9 Other hep avaiabe Sections Consequences of arrears Section 12 Usefu contacts Section 13 Get in touch 2

3 Understanding debt 1. Know your options Anyone can get into difficuty managing their debt. Even sma changes in your circumstances can put huge pressure on your finances and these can quicky resut in missed oan repayments and mortgage arrears. However, there are soutions. With our hep, taking contro of your debt and getting back on track coud be easier than you think. It is why we have produced this guide so you can see just how many hepfu services are avaiabe to you if you are trying to stay on top of your finances. For instance, if you anticipate difficuty paying your Uster Bank mortgage, or are aready in arrears with your mortgage arrears payments, this guide wi show you how Uster Bank wi hep by taking you through the steps we foow as part of our Mortgage Arrears Resoution Process (MARP). Aso, whether your debt is with us or another bank or mortgage provider, you wi find practica soutions to hep you resove your debt. Remember, the most important thing is to tak to us if you fee debt is becoming a probem so we can give you as much hep as possibe. If you are an Uster Bank customer and are strugging with your finances, pick up the phone or ca into your oca Uster Bank branch straight away. Our staff wi be happy to hep you take the first steps to managing your debt, and it coud ead to a new repayment schedue being organised. The number of your oca branch can be found on or in the phonebook. For Uster Bank mortgage arrears reated queries, pease ca us on If you have a query in reation to Uster Bank persona debt, overdrafts or oans, pease ca How to cut through the jargon To know exacty where you stand financiay, it s important to have a cear understanding of the terminoogy invoved. We have isted the most common terms you wi come across when deaing with us or other banks, beow. In addition, The Competition & Consumer Protection Commission website has a jargon buster section which you may find hepfu. Arrears This is where a repayment has not been paid in fu, on the agreed date as per your origina contract repayments. Mortgage ender This is the credit institution that you take out your mortgage with. Repayment mortgage A repayment mortgage is one where you pay off the oan amount (capita) and interest at the same time. Term This refers to the ength of your oan or mortgage. It s normay stated in months or years. Credit history This is the track record of your repayments on oans/mortgages/credit faciities you currenty have or had in the past. An agency caed the Irish Credit Bureau keeps fies on borrowers and uses the information it gets from enders to buid up each borrower s credit history. 3

4 SFS (Standard Financia Statement) A form used by banks to obtain financia information from you in order to hep evauate your financia situation. This is part of our financia assessment at Uster Bank. Under the Code of Conduct on Mortgage Arrears issued by the Centra Bank of Ireand, a banks must have a process in pace to hep customers who may have difficuty paying their mortgage or have aready faen into arrears. Moratorium A moratorium is a temporary arrangement between the customer and the bank to defer repayments and suspend coections activity for an agreed period of time. A moratorium may sometimes be referred to as a repayment break and may be considered by the bank for a variety of reasons. For exampe, it coud work as part of a soution to hep customers experiencing financia difficuties to get back on their feet. Uster Bank Ireand Limited References to Uster Bank and Uster Bank Group in this booket reate to Uster Bank Repubic of Ireand. 2. What can you do about probem debt? Being in financia difficuty can eave you in a constant state of worry making it easy to panic and ignore the situation. The onger you are strugging, the more the debt mounts so it is better to act swifty. If you find yoursef faing behind with oan or mortgage repayments, tak to us or your ender as soon as possibe. By making us aware of your fu financia situation, we can expore a your options and ook at working out a soution for you. Here are some additiona steps to take if you find yoursef in financia difficuty: work out a persona budget and stick to it. make sure you re caiming a the benefits and tax credits you re entited to. Contact your oca Community Wefare Officer or oca Citizens Information Centre for advice on what your individua entitements are. tacke your priority debts first, for exampe your mortgage and secured oans. see if you can work out a repayment timetabe that suits everyone. get free independent money advice from agencies such as the Citzens Information Board (CIB) and Money Advice & Budgeting Service (MABS) by visiting Finay, here are some things you shoud never do if you find yoursef in difficuty: never ignore missed repayments, they won t go away. don t ignore correspondence from your financia institution. don t avoid cas from your financia institution, as taking to your bank shoud be the first step to heping you get the situation under contro. 4

5 3. How do you get into financia difficuty? A number of factors can ead to arrears. Here are some exampes of circumstances that can effect your abiity to pay your bis. Job oss These days many peope are osing their jobs or are having their hours reduced. If you ve ost your job, or if your partner has ost theirs, it wi have an immediate and extreme effect on your finances. If you have savings, you may be abe to put these towards meeting your repayments whie you ook for a new job. If you don t, it can be stressfu trying to make ends meet. Reduction in working hours A reduction in working hours, sometimes to a two or three day week, is aso becoming commonpace. In some situations, it is possibe to suppement your income with Socia Wefare payments. To find out more, contact your oca Socia Wefare Office. Reduction in saary Many companies have been forced to cut empoyees saaries in an effort to reduce their operating costs. This can have an immediate effect on your monthy budgeting efforts. By using the Budget Pan, which you find further on in this booket, to anayse your outgoings against your reduced income, you can start identifying areas where you can cut back on non-essentia spending. Redundancy If you ve been made redundant and have received a ump sum, you shoud work out how to make the best use of the money unti you re working again. For exampe, if it s possibe to cear a oan or your mortgage with this sum, it may be a good idea to do so. Reationship breakdown When one partner eaves, the other can be eft to face paying a mortgage or oan(s) on their own. In this situation, it s very easy to end up in arrears. However, it s important to remember that both partners, because they took on the mortgage together, are jointy iabe, so they must both pay back the oan, regardess of who ives in the property. In the event of death When in financia difficuty, peope sometimes stop paying their ife assurance poicy. This is not a good idea as, if you die and don t have ife assurance, your debts can be passed on to your reatives. Therefore, it s best to keep up-to-date on your ife cover payments. If you are in severe financia difficuty, there are ess expensive poicies avaiabe which offer ess cover but woud sti pay off the majority of your capita. Before changing your ife assurance poicy, do seek independent advice. Remember, it s vita to be accurate and honest with your ife assurance appication and to be carefu not to omit any materia facts. For exampe, if you put down that you are a non smoker when your medica records show that you are, it coud resut in a future caim being rejected. Iness If you or a member of your famiy becomes i, the cost of medica treatment can be very expensive and can have a major impact on your ife and your finances. It s why having adequate heath insurance is so important. Some ife assurance poicies incude critica iness cover which may pay a benefit to you in the event of you or your spouse/dependants contracting a serious iness. Check the terms of your poicy to see what you re entited to. 5

6 Other ways debt can pie up Debts can mount for a number of different reasons. You may simpy be having probems managing your finances and keeping enough money in your accounts to meet your payments; you may have taken on more debt than you re abe for, or the extra expense that comes with having a new baby coud be putting a strain on your abiity to meet your expenses. Whatever your reason for being unabe to pay your debts, it s important not to ignore the situation or pretend it s not happening. As you see in the next section, there are severa things you can do to effectivey manage debt. How to manage debt 4. What are the danger signs of debt? Beow is a ist of financia warning signs. If some of the foowing statements sound famiiar, you coud soon find yoursef facing a debt probem: you borrow from friends or famiy without knowing when you be abe to pay them back you borrow money to pay off other debts you re not sure how much you owe you ony pay the minimum amount due on your credit card(s) every month you re paying ate payment fees on credit or store cards you reguary pay referra fees due to being overdrawn you have used up a of your savings your monthy income is not sufficient to cover your monthy outgoings i.e. credit card, overdraft, utiity bis 6

7 How to get in contro of debt 5. What can you do to contro your debt? If you find yoursef in financia difficuty for whatever reason, these tips coud be of hep: watch what you spend and work out ways to make your money go further by panning a budget. ensure you re getting a of your socia wefare entitements. Contact the Department of Socia and Famiy Affairs and et them know where you stand. if you have an income protection insurance poicy, check to see if you can make a caim. This may provide a reguar income for the duration of your iness, injury or disabiity, or unti you return to work or retire. you may aso be abe to caim on other protection poicies. For exampe, mortgage repayment protection insurance coud be appicabe in the case of redundancy. Panning a budget Panning and sticking to a budget can be tough but it reay can make a difference as you work towards cearing your arrears. If you know how much money is coming in and going out, you know exacty how much you need to pay your bis. It s essentia to keep your figures as accurate as possibe, so make sure you take a your outgoings into account. Use the tempate budget pan beow to hep work out your income and outgoings. Put a the figures in monthy amounts. Here s a handy itte tip to hep you work out the monthy amounts: for weeky payments, mutipy by 52 and divide by 12 for quartery payments, mutipy by 4 and divide by 12 for yeary payments, divide by 12 Maximise your income Once you ve worked out a budget, you can ook at different ways of increasing your househod income as foows: caim a Tax Credits you re entited to, for exampe: incapacitated chid/reative service charges (waste charges etc.) caim a the state benefits or aowances you re entited to, for exampe: Job Seekers Aowance Chid Benefit Carers Aowance Famiy Income Suppement Mortgage Interest Suppement Suppementary Rent Aowance caim tax reief on any expenses you re entited to, for exampe: TRS (Tax Reief at Source) medica and denta expenses rent out a room in your home if possibe gross annua renta income of up to 12,000 in 2015 is exempt from tax You find a comprehensive guide to what you re entited to at 7

8 My budget pan Monthy Income: Now Future Your income after tax Your Partner s income after tax Chid Maintenance Famiy Income Support Benefits (e.g. Chid/unempoyment/one parents) Mortgage Interest Suppement Renta Income Savings Income/Share Dividends Other Income Tota income Summary Now Future Tota income e e Less tota bis e e What s eft for saving or spending e e Monthy Outgoings: Now Future Reguar Savings Lunch, coffee or papers Trave, expenses and petro Cothes Sociaising or hobbies Chidren pocket money or trips Monthy Outgoings: Now Future Mortgage or rent Utiity bis (rates, gas, eectricity, refuse) Loan and credit card repayments Food or househod shopping Chidcare Ad hoc spending (birthdays, hoidays and so on) Emergency fund** Tota non-essentia spending e e **Emergency fund shoud aow for any additiona persona incidentas. Notes/Cacuations Insurance (Life, home, medica, etc.) Medicines and medica expenses Home maintenance and househod goods Other expenditure (mobie phone, broadband, sateite TV) Emergency fund* Tota outgoings * Emergency Fund shoud aow for irreguar bis such as home heating, quartery direct debits, car breakdown and so on. 8

9 How to reduce your spending To reduce the amount you spend, start by taking an objective ook at your outgoings to see what you can do without. Most of what you spend can be put into one of the foowing categories: Priority Responsibiities For exampe: Mortgage Rent Essentia utiity bis (Gas, Eectricity etc.) Insurance and Protection Standard everyday spending costs (as outined beow) Everyday Spending Costs For exampe: Food Cothing Petro Chidren and associated expenses Secondary Responsibiities For exampe: Persona oan Overdraft Credit cards Store cards Occasiona Costs For exampe: Car maintenance Birthdays Christmas Discretionary Spending For exampe: Gof subscriptions Gym subscriptions Hoidays and gifts Once you ve competed your budget sheet, highight any areas that aren t essentia so you can see ceary where you can cut back on your spending. Other ways to reduce your spending Here are some additiona tips to hep you cut down on your monthy spend. Keep a spend diary There are some things you have to pay your mortgage, oan repayments, rent and bis but by cutting down on non-essentia items, ike nights out, magazines and takeouts, you can save significanty. Keep a spending diary and you probaby find you buy a ot of things you reay don t need. Shop around The best way to get more from your money is to shop around. Check out the most competitive rates for phone and internet connection at Aso, make a point of shopping around for your everyday groceries to see how much you can save. Bank onine* Banking onine is a great way of keeping on top of your spending. For exampe, with Uster Bank s onine banking service, Anytime Banking, your baances and statements are updated in rea time. It means you can keep an accurate check on your baance and your outgoings. You can aso pay your bis any time you wish, which wi hep you to budget more effectivey. Save your energy Making sma changes can mean big savings on your energy bis. For instance, if you ower your thermostat by 1 C, you coud save up to 10% on your heating bi. Aso, by switching off anything you re not using ights, computers, TVs and so on, you soon see a difference in your bis. For more handy tips on saving money and energy, visit TV subscriptions Dedicated movie and sports channes can reay add up, so if you ony watch movies now and then, it may be cheaper to rent a DVD instead. Trave smarter Instead of driving to work, you might find it s cheaper to use pubic transport. An annua trave ticket coud save even more. Be sure to check with your empoyer to see if they re invoved with the Tax Saver scheme which deducts the cost of your annua ticket from your saary and can save you up to 41% tax, 4% PRSI and 7% USC. You find more information at If you ive near work, consider cycing or waking. It s a heathy option and it costs nothing, so your finances wi be heathier too! Downsize If you have to drive, ook at trading in your car for a mode with cheaper tax, insurance and running costs. Making sma changes ike these in the short term can hep you get back in the driving seat. * Terms and conditions appy. To sign up for Internet Banking you need to have an Uster Bank Persona account or Credit Card hed in the Repubic of Ireand and be aged 11 or over. 9

10 Compare your insurance By comparing quotes across providers, you may be abe to save substantiay on your insurance costs. Just make sure you have adequate cover for your circumstances before you switch. For exampe, you shoud have sufficient home and contents insurance to safeguard you against everyday accidents and more serious probems ike fire or theft. On the other hand, if your circumstances have changed, a review of your existing poicy may resut in your needing ess cover. You find cost comparisons onine at Aso, check to see if you can pay your insurance premiums in monthy instaments, rather than as a ump sum, as it coud make budgeting easier for you. 6. Tak to us Getting into difficuty with debt? Then get in touch. If you are strugging with your finances, pick up the phone or ca into your oca Uster Bank branch straight away. Our staff wi be happy to hep you take the first steps to managing your debt, and it coud ead to a new repayment schedue being organised. The number of your oca branch can be found on or in the phonebook. For Uster Bank mortgage arrears reated queries, pease ca us on (1800 hep me). If you have a query in reation to Uster Bank persona debt, overdrafts or oans, pease ca Our website provides exampes of how we can hep. But that s not a we can do. Overeaf is a ist of other ways Uster Bank can hep you contro your debt. How can we hep? 7. How can we hep you? If you are having difficuty managing your debt or paying your mortgage, we are here to hep. Uster Bank has introduced a financia assessment, that is designed to evauate your financia situation and give you a heping hand when you need it most. Here is how it works. Speciay trained Uster Bank staff carry out a financia review. They wi take account of your current financia situation whie heping you to figure out a suitabe soution to managing your debt especiay if you are strugging to meet your mortgage repayments. This step-by-step process assesses your current financia situation by considering: a) your persona circumstances b) the eve of your debt c) the financia information you provide d) your current abiity to make repayments e) your previous payment history You may be asked to provide further documentation to support the information provided in the financia review. Our staff wi take you through the repayment options avaiabe and hep you to work out the best way to manage your debt and meet your mortgage repayments. Options incude: 10

11 Arrangement Options The avaiabiity of the beow options are subject to an individua assessment of your persona situation, and meeting our criteria. Arrangement Options Interest Ony Repayment Reduced Repayments Moratorium Repayment Break Term Extension Capitaisation of Arrears Fixed Rate Reduced Repayment for the remaining term Expanation Short Term Arrangements For a temporary period, you wi ony pay the interest eement of your repayment. This wi mean that your repayment amount wi reduce during this arrangement. When this arrangement ends you wi return to paying capita and interest repayments. As you have not made capita repayments during this arrangement your future (Capita and interest) repayments wi increase for the remaining term. For an agreed period of time your repayments wi reduce as you wi be paying a reduced amount of capita and/or interest in your repayment. At the end of your of this arrangement your repayments wi increase to cover the reduced capita and/or interest during this arrangement. The increased repayments wi ensure your mortgage/oan is repaid within the remaining term. For an agreed period of time your repayments are postponed. When this arrangement ends, your repayments wi increase to cover the postponed repayments, this wi ensure the mortgage/oan is repaid within the remaining term. Long Term Arrangements This arrangement wi mean that the term remaining on your mortgage/oan is extended. Your repayment amount wi be reduced as the oan/mortgage has been spread over a onger period. However, you wi pay more interest as your term has been extended. This arrangement wi mean that arrears outstanding wi be added to the remaining capita baance of the oan/mortgage. Your future repayments wi increase to repay the oan/mortgage within the remaining term. You wi no onger be in arrears. This arrangement wi mean that for the remaining term of your oan/ mortgage, your repayments wi be reduced. At the end of the oan/ mortgage term, there wi be a residua baance which wi need to be repaid. We wi contact you to address this towards the end of your oan/mortgage term. Arrangement Options Reduced Interest Rate Spit Mortgage Mortgage to Rent Trading Down Assisted Vountary Sae Expanation Long Term Arrangements This arrangement wi mean that for an agreed period of time the interest rate on your mortgage /oan is reduced. This means that you wi be repaying more capita over this period and your mortgage/oan baance wi reduce quicker in this period. At the end of this arrangement, you wi return to a Standard Variabe Rate or the tracker rate (if your mortgage/oan was on this prior to the arrangement being put in pace). Repayments may increase. This arrangement is ony avaiabe on your primary residence. This arrangement wi mean that your current mortgage/oan outstanding baance is spit into two parts. Part 1 You wi continue to pay in fu over a specified term and Part 2 wi be set aside for repayment at a ater specified time. This means that your repayments are reduced for the period of the arrangement. Other Options Avaiabe* A Government initiative whereby you vountariy surrender your property to the ender. The Lender wi se the property to the Approved Housing Association (AHA) at the current market vaue and you remain in the property as Socia Housing tenants of AHA. Where a shortfa exists (the property is sod for an amount ower that what is currenty owed on the mortgage), the shortfa wi be repayabe by you under new terms set by the ender. If you fee the current mortgage baance is no onger affordabe, we wi assess your circumstances to ascertain what eve of debt is now affordabe to enabe you to se existing property and trade down to another suitabe/more affordabe property. If you fee the current mortgage baance is no onger affordabe we wi assist you in the sae of the property. Where there is an outstanding baance remaining on the mortgage you remain iabe for this amount. Vountary Repossession If you fee that the current mortgage baance is no onger affordabe you can request the bank to take ownership of the property. We wi se the property on your behaf but you wi remain iabe for any outstanding baance. *subject to an individua assessment of each case and meeting the ender s (or a third party s) criteria. Use of Confidentiaity Agreements Where an aternative repayment arrangement, or an option, other than an aternative repayment arrangement is being proposed to you by the bank, you may be required to enter into a confidentiaity, non-discosure or other simiar agreement. This agreement obiges you to keep confidentia the existence and terms of the proposa and /or the fact that discussions and/or negotiations are taking pace between the bank and you and/or the scope and terms of such discussions/negotiations (Information). You may not discose this Information to any third party except to your advisors, agents, empoyees and/or directors, and you are obiged to ensure that such persons aso keep the Information confidentia. This obigation does not appy to any discosure of information required by aw. Aternative repayment arrangement reviews We may contact you periodicay to review your aternative repayment arrangement, and in addition we wi be in contact at east 30 days prior to the end of the Arrangement to assess your financia circumstances and to determine what other option/s are suitabe and sustainabe for you. 11

12 Important Information to Note WARNING: YOUR HOME IS AT RISK IF YOU DO NOT KEEP UP PAYMENTS ON A MORTGAGE OR ANY OTHER LOAN SECURED ON IT. WARNING: IF YOU DO NOT MEET THE REPAYMENTS ON YOUR CREDIT AGREEMENT, YOUR ACCOUNT WILL GO INTO ARREARS. THIS MAY AFFECT YOUR CREDIT RATING, WHICH MAY LIMIT YOUR ABILITY TO ACCESS CREDIT IN THE FUTURE. If you have a variabe rate mortgage: WARNING: THE PAYMENT RATES ON THIS HOUSING LOAN MAY BE ADJUSTED BY THE LENDER FROM TIME TO TIME. If you have a fixed rate mortgage: WARNING: YOU MAY HAVE TO PAY CHARGES IF YOU PAY OFF A FIXED-RATE LOAN EARLY. If you have a debt consoidation mortgage: WARNING: THIS NEW LOAN MAY TAKE LONGER TO PAY OFF THAN YOUR PREVIOUS LOANS. THIS MEANS YOU MAY PAY MORE THAN IF YOU PAID OVER A SHORTER TERM. If you have an endowment oan: WARNING: THERE IS NO GUARANTEE THAT THE PROCEEDS OF THE INSURANCE POLICY WILL BE SUFFICIENT TO REPAY THE LOAN IN FULL WHEN IT BECOMES DUE FOR REPAYMENT. If you have interest ony repayments on a temporary basis: WARNING: THE ENTIRE AMOUNT THAT YOU HAVE BORROWED WILL STILL BE OUTSTANDING AT THE END OF THE INTEREST-ONLY PERIOD. If you have a tracker mortgage, we wi not ask you to change to another type of mortgage uness you want to. For exampe, if you are having difficuty paying a tracker mortgage and the best aternative repayment arrangement for you is a fixed interest period, you wi be abe to go back to the origina tracker mortgage at the end of the fixed interest period. When you revert to your origina tracker mortgage the tracker mortgage rate wi be determined by the European Centra Bank (ECB) rate at that time. ECB rate changes can impact your norma monthy repayment or an aternative repayment arrangement. A options outined in this section are subject to specific terms & conditions. Every customer s circumstances are different, so our Uster Bank staff wi review your situation and then discuss soutions potentiay avaiabe to you. How can we hep? Our trained advisors wi expain any proposed aternative repayment arrangement and provide you with written detais. This arrangement wi then be reviewed by Uster Bank within six months. As part of this review, we wi contact you to discuss whether there has been any change in your individua circumstances. That way we can determine whether the aternative arrangement is sti appropriate for you. Shoud you wish to take independent ega and/or financia advice on the aternative repayment proposa, you find a ist of usefu contacts on page 18. On the next page you find an exampe of how our financia assessment coud assist a famiy to manage their debt and meet their mortgage repayments. WE WILL STAY IN TOUCH WITH YOU DURING YOUR ARRANGEMENT, HOWEVER PAYING THE MORTGAGE REMAINS YOUR RESPONSIBILITY. IF YOUR FINANCIAL CIRCUMSTANCES CHANGE, YOU SHOULD ENSURE THAT YOU REMAIN IN CONTACT WITH US. IT IS IMPERATIVE THAT YOU FULLY CO-OPERATE WITH US, YOUR MORTGAGE LENDER REGARDING YOUR MORTGAGE ARREARS OR YOU MAY BE AT RISK OF BEING CLASSIFIED AS NOT CO-OPERATING. YOU MUST ALSO BE AWARE THAT IF THERE IS ANY OUTSTANDING DEBT OUTSTANDING ONCE THE MORTGAGE REACHES THE END OF THE TERM THIS COULD BE RECOVERED THROUGH ADMINISTRATION OF YOUR ESTATE. 12

13 Their monthy budget is as foows: Income: Net Saary 3,100 Chid Benefit 260 Tota Income 3,360 Expenditure: Mortgage 1,500 Car oan 250 Car tax, insurance and running costs 300 Home Phone, TV and Broadband 82 Eectric and Fue 230 Food and Cothing 820 Mobie Phone 40 Home and Life Insurance 140 Heath Insurance 200 Credit Card 100 Tota Outgoings 3,662 This resuts in a monthy shortfa of 302 This iustration is based on a typica 100,000, 20 year variabe rate mortgage at 4.6% APR (Annua Percentage Rate), with the cost per month of excuding insurance. The tota amount repayabe is 151, **The tota cost of credit (tota amount repayabe mortgage amount) is 51, If rates increase by 1% an additiona woud be payabe monthy. The tota cost of credit with a 1% increase is 65, This exampe shows a mortgage that was drawn down two years prior to an arrangement being put in pace. Arrangement Interest ony Payment reduced by 330 Moratorium Term 12 months 6 months 6 months Monthy payment prior to the dea *Monthy repayment during the period of dea Monthy payment when the dea ends As a resut of this temporary arrangement the tota cost of credit may increase by , , Foowing a financia assessment, Uster Bank agreed to temporariy reduce the monthy mortgage repayment to 1, for six months. Term extension 5 years n/a , This resuted in a monthy excess of for the customer. It s important to understand that the reduced repayment is ess than the amount required to cover the monthy mortgage payment Therefore, the mortgage baance and the interest due wi continue to increase unti such time as this shortfa is fuy repaid. Cost of Credit The foowing exampe, estimates the impact a financia arrangement may have on the tota cost of credit on your mortgage. * Fexibe payment options may appear cheaper in the short term but coud be more expensive over the ife of the mortgage and are subject to approva. ** The tota cost of credit is the tota amount repayabe ess the amount of the origina mortgage vaue. For iustration purposes it is cacuated using a variabe interest rate and is therefore subject to change. Rates and repayments are correct as of the 8 December 2014 and are subject to change. WARNING YOUR HOME IS AT RISK IF YOU DO NOT KEEP UP PAYMENTS ON A MORTGAGE OR ANY OTHER LOAN SECURED ON IT. VARIABLE RATE LOANS: THE PAYMENT RATES ON THIS HOUSING LOAN MAY BE ADJUSTED BY THE LENDER FROM TIME TO TIME. 13 WARNING: IF YOU DO NOT MEET THE REPAYMENTS ON YOUR LOAN, YOUR ACCOUNT WILL GO INTO ARREARS. THIS MAY AFFECT YOUR CREDIT RATING, WHICH MAY LIMIT YOUR ABILITY TO ACCESS CREDIT IN THE FUTURE.

14 8. What wi we do for you? Shoud your mortgage account go into arrears, we wi contact you to estabish why you have missed your repayment. Depending on your circumstances, one of our trained advisors wi carry out a financia review with you. The advisor wi take account of your current financia situation whie working with you to provide a suitabe soution to manage your debt. If you are appying for state support to hep with your mortgage, we wi endeavour to provide you with the required information within 10 working days of receipt of your request. Once we have received your written consent, if you require, we can iaise with a third party nominated by you. Simiary, if we appoint a third party to dea with your case we wi advise you in writing. As with a repossessed properties, if the bank ses the property and the sae amount is ess than the mortgage amount owed, you wi sti be iabe for the remaining debt. As outined in Section 10 your credit rating wi sti be affected even if you have given your house keys to the bank. Vountary Sae Vountary Sae is where you decide to se your home to pay off your debt. You shoud be aware that if your sae price is for ess than the amount outstanding on your mortgage, you wi sti be iabe for the remaining debt. Trading Down Trading Down is where you se your current property and move to a smaer home. As with vountary sae, just bear in mind that if you se your home for ess than the amount outstanding on your mortgage, you wi sti be iabe for the remaining debt. What if you are not happy with the mortgage resoution proposed? If you are having difficuty paying your mortgage or find yoursef in arrears, Uster Bank wi do a it can to find a soution to hep you. If you are unhappy with the proposed payment arrangement, or if we fee we are unabe to provide you with an aternative soution due to your circumstances, there are a number of other options you have a right to consider. Vountary Surrender Vountary Surrender is where you hand over the keys of your property to your mortgage provider. It is important to remember that, even if you do hand over the keys, it doesn t mean you are no onger obiged to repay the debt owed to their bank. There are a number of impications: The physica return of keys has no ega significance the amount you owe on the mortgage wi sti be outstanding. Even if you hand back the house keys, the bank may sti have to gain a possession order and the process wi be simiar to that outined for repossession. Returning your keys does not make this process any faster. 14

15 Other hep avaiabe 9. What other hep is avaiabe? Do check to ensure you are caiming any entitements you might be eigibe for with your mortgage, such as the Mortgage Interest Suppement or Mortgage Interest Reief. Mortgage Interest Suppement If you are unempoyed or your wages have been reduced, you may be entited to caim a Mortgage Interest Suppement to hep you with your mortgage repayments. To quaify, you wi have to meet the foowing criteria: when you began your mortgage, you coud afford the repayments your house is not up for sae you are habituay resident in this State (see Income taken into account for Mortgage Interest Suppement incudes: net Income from empoyment socia wefare payments with some exceptions HSE payments. There are some exceptions. Pease see Income not taken into account beow. Income not taken into account for Mortgage Interest Suppement incudes: Suppementary Wefare Aowance (SWA) rate for your househod circumstances Chid Benefit Mobiity Aowance Mortgage Interest Reief Mortgage interest reief is a tax reief based on the amount of mortgage interest you pay in a given tax year for your principa private residence your home. In order to quaify, the interest must reate to money you have borrowed to purchase, repair or improve your soe or main residence, situated in Ireand. In other words, you cannot caim mortgage interest reief for interest on a oan used to buy a hoiday home or investment property. Since 2002, it has been administered via Tax Reief at Source (TRS) which means your mortgage ender gives you the benefit of tax reief on the amount of mortgage interest paid. They do this by reducing your mortgage repayment by the amount of tax reief you are entited to in each tax year. Your mortgage ender then in turn caims this tax reief from the Revenue Commissioners. If you take out a new mortgage, you must compete a TRS1P form. Your competed form shoud be submitted to the Revenue Commissioners as soon as you have made your first mortgage repayment. This form is avaiabe from your mortgage ender or from the Revenue Commissioners at the address beow. If you have any difficuties competing this form, contact the TRS hepine at For more information on Mortgage Interest Reief visit or To find out if you re eigibe for this suppement, contact the Community Wefare Officer at your Loca Heath Centre or visit Remember, if your appication is unsuccessfu for whatever reason, you are entited to appea the decision. 15

16 Consequences of arrears 10. What happens if you don t pay? Here are some of the possibe consequences of not repaying your debts. You may be cassed as not co-operating There are may consequences if you are cassed as not co-operating some of which are that you wi ose the protection of MARP, ega proceedings may commence immediatey and you may no onger be eigibe for a Persona Insovency Arrangement under the Persona Insovency Act There are other disadvantages of bankruptcy to consider: A court coud order part of your saary or pension to be deducted to your creditors. Refusa of credit faciities. You may not be aowed to inherit. Any inheritance must be used to pay your creditors. Your name and address woud be recorded on the Bankruptcy Register kept by the Examiner s office. Even if you are eventuay discharged from bankruptcy, your name wi remain on the register, and anyone invoved in buying or seing property normay conducts a search on this register. You can t be a director of a company without permission of the court. You won t be abe to hod certain positions as an eected representative. Your Credit Rating Your Credit Rating is affected when payments due are missed and this record remains on the Irish Credit Bureau (ICB) for five years after your oan has been cosed or seven years if a judgement mortgage is obtained. If you end up with a bad credit rating, it can affect your future chances of getting a oan or any credit reated purchase, even a contract mobie phone. Repossession If your house is repossessed, you wi sti be iabe for the fu amount of the debt incuding any shortfa if the sae of the house doesn t cear the outstanding baance owed. If your mortgage is for an investment property, you coud face a charge on your famiy home meaning it coud ony be sod with the ender s permission. Otherwise, a judgement might be made which eaves you responsibe for the debt. Lega Fees If the bank begins ega proceedings, you may be iabe for ega costs which are ikey to exceed 3,000 and may be consideraby higher depending on the circumstances. You may aso be iabe for any ega costs where you retain your own ega advisers. Fees We do not appy fees and charges in reation to mortgage arrears. However, where fees are appicabe, such as Lega Fees, we wi advise you in writing. 11. What woud repossession actuay mean? 16 Pubic Record If a Civi Bi is issued, your arrears are then a matter of pubic record and you coud end up being named in papers such as the Stubbs Gazette. Bankruptcy If you re unabe to pay your debts, you can decare yoursef bankrupt. This is where your property or assets are transferred to a trustee and sod. The resuts of this sae are then spit between your creditors. It s worth remembering that if you re made bankrupt in Ireand, you stay bankrupt uness you re discharged by the court. Repossession is where you ose your property when you can t pay your mortgage. For Uster Bank, this is a ast resort as we wi aways try to work with you to find a soution. However, repossession can happen if you don t engage with us, if we are unabe to agree a soution, or if you don t compy with the terms of the soution. With repossession, your home is usuay sod at a pubic auction and the sae proceeds are used to pay your debt. Repossessions take severa months to compete and wi end with you osing your home.

17 What is the repossession process? Whether your mortgage is with us or another ending institution, the procedure is generay as foows: 1. Letter before action Before any action is taken, you wi receive a Letter of Demand from your bank advising you of your outstanding debt and the fact that ega action wi be taken if it is not paid within a certain period of time. 2. Court choice Cases for the repossession of houses may be taken to the High Court or the Circuit Court. 3. Issue of proceedings This is a Civi Bi in the case of the Circuit Court and an Equity Summons in the High Court. The proceedings are then served upon you by pre-paid registered post in the case of the Circuit Court and by persona service in the High Court. 4. Enter appearance If proceedings are served upon you, you wi need to appear in court at the time and day schedued in the issue of proceedings. If you don t, it may automaticay resut in judgement in defaut and coud resut in repossession. 5. Enter a defence Once you enter an appearance, you then fie a defence. You may wish to get your own ega representation at this stage (if not before). 6. Court date/hearing If you are unsuccessfu at the hearing in your defence of the action, an order for possession may be granted. Aternativey, the judge may enforce a payment agreement between you and your ender. 7. Foowing disposa of the property you wi be notified in writing of the: a) Amount of outstanding debt remaining. b) Costs arising from the disposa which have been added to the oan account. c) Interest rate to be charged on the remaining baance. It is never too ate to contact us to try to find an aternative repayment soution, even if proceedings have commenced. At Uster Bank, we wi do everything we can to hep you keep your home. Appeas Board At Uster Bank, we wi do a we can to hep you manage your debt and keep your home, however, if you are unhappy with our credit decision you have the right to appea to our Appeas Board on the foowing grounds: where an aternative repayment arrangement is offered by a ender and the borrower is not wiing to enter into the aternative repayment arrangement; where a ender decines to offer an aternative repayment arrangement to a borrower; and where a ender cassifies a borrower as not co-operating. Your appea must be made in writing and forwarded to our Appeas Administration Team at Appeas Board, Uster Bank, Appeas Administration Team, 2nd Foor, Bock B, Centra Park, Leopardstown, Dubin 18. Your appea must be submitted to Uster Bank within 20 business days from the date you received notification of our credit decision. We wi acknowedge your appea in writing within 5 business days of receiving it and provide you with the name of one of our members of staff who wi be your point of contact during the appeas process. Our Appeas Board wi consider and adjudicate on your appea within 40 business days from date of receipt. We wi advise you of the outcome of your appea in writing within 5 business days of the Appeas Board decision. If you are unhappy with the decision of the Appeas Board, you have the right to refer the matter to the Financia Services Ombudsman, 3rd Foor, Lincon House, Lincon Pace, Dubin 2. Teephone or o-ca

18 Usefu Contacts 12. Usefu contacts It can be hard to know where to turn when you are in financia difficuty but we want you to be aware of a the options. So here is a ist of agencies that can offer you hep and guidance in reation to controing your debt. Remember to make the most of the assistance avaiabe as eary as possibe. Uster Bank Branches As mentioned earier, the first step in managing debt is to tak to us. If you find yoursef faing behind in payments on an Uster Bank oan, contact your oca Uster Bank branch as soon as possibe. You find the number isted in the phone book or by visiting Uster Bank Arrears Support Unit If you are having difficuty meeting your mortgage repayments or you are aready in arrears, you can get in touch with us to discuss your situation. By taking to our quaified team, we can work out a soution together that wi hep you to resove your mortgage debt as we as ook at ways to manage your money. Teephone: or visit our website MABS (Money Advice and Budgeting Service) MABS is a Government agency that provides free, confidentia and independent advice on your debt probems. There are offices a over Ireand and their advisers can assess your overa financia situation and offer vauabe advice. MABS 2nd Foor, Commercia House, Westend Commercia Viage, Banchardstown, Dubin 15 Teephone: (Mon Fri 9am to 8pm) Website: Citizens Information Board and MABS We suggest you visit the mutua website of the Citizens Information Board and MABS which provides information on the services and entitements avaiabe if you are having difficuty paying your mortgage. Teephone: Website: Court Service The Courts Service can give you detaied information on the courts system and can answer any questions you have Phoenix Street North, Smithfied, Dubin 7 Teephone: Website: Lega Aid Board This organisation aims to provide professiona, efficient, cost-effective and accessibe ega aid. They wi aso provide you with ega advice. Quay Street, Cahirciveen, Co. Kerry Teephone: Emai: info@egaaidboard.ie Website: Code of Conduct for Mortgage Arrears A banks operating in Ireand must foow a code of conduct. To see the Code of Conduct that we are bound by, visit the Centra Bank of Ireand s website or ca

19 Recession Surviva Guide The Competition & Consumer Protection Commission has put together a free Recession Surviva Guide with tips and ega information that coud come in handy. You wi find this guide at Knowing Irish Law If you re in debt and worried, it s a good idea to know your rights. Reference websites which wi hep you to get a grasp of Irish aw are and It is worth ooking up the Consumer Credit Act 1995 and the Consumer Credit Directive. The Law Society (Officia Soicitor Organisation) If you have read through this guide and think you wi need to find a soicitor, a ink to the directory of soicitors is avaiabe on the Law Society s homepage at Free Lega Advice Centres If you need ega hep but don t have the money, FLAC is an independent organisation offering free services on a range of ega issues such as socia wefare and credit and debt. Address: 13 Lower Dorset Street, Dubin 1, Ireand Teephone: Website: Socia Wefare Agencies As mentioned in Section 8, you may be entited to hep with your situation, so you shoud check up on any potentia entitements. For a ist of socia wefare agencies that may be abe to assist you, visit Get in touch 13. Get in contro of your debt. Get in touch today We hope you have found this guide hepfu. Remember, you shoudn t have to face debt aone. Together we try to find a way of making things more manageabe. It s important that you co-operate with us, otherwise the protections of the Mortgage Arrears Resoution Process (MARP) no onger appy. So if debt is becoming a probem, why wait? To tak to one of our staff members about your finances, don t hesitate to pick up the phone or ca into your oca Uster Bank branch today and get the right peope behind you. If it is your Uster Bank Mortgage that you are concerned about paying, or if you are aready in arrears, contact us on and one of our trained advisors wi arrange to meet you to see if we can hep resove your mortgage debt. For hep with your persona debt, overdrafts or oans, contact us on Aternativey visit our website Meet with one of our staff members When you make an appointment to speak with one of our staff members, pease take the time to read the checkist overeaf and gather a the reevant information in advance of your meeting. This wi ensure you provide a fu picture of your situation to our staff member and hep us to identify some soutions that are potentiay avaiabe to you. 19

20 Checkist for your appointment with us Pease have the foowing information with you: 1. Teephone Number(s): Mobie/Home/Work: During the meeting we wi aso hep you to compete a Budget Panner to get an overa idea of your finances. It woud therefore be usefu if you coud bring detais of your reguar expenditure, exampes beow Eectricity/Fue 2. Mortgage Account Number(s 3. Other Uster Bank oan account number 4. Last 3 months current account statements 5. Last 2 paysips, if your saary is not paid to your current account 6. Letter from your accountant confirming your income if you are sef empoyed and your saary is not paid to your current account Food/Cothing Home Insurance/Life Assurance/Heath Insurance Car tax and insurance Other oan payments Teephone/Broadband Based on your financia situation we may need to review some of the foowing items, so it is a good idea to bring them with you: Cub subscriptions Chidcare Credit card statements Other occasiona costs Persona oan statements Credit Card Detais Provider/Limit/Usage/Monthy payments If you have recenty had a reduction in income Letter of Confirmation from your empoyer If you have recenty become unempoyed P45 and confirmation of any severance payments from your former empoyer 20

21 To find out more: Ca into your oca branch Uster Bank has dedicated staff avaiabe in every branch to discuss your mortgage situation Ca us on: Mon-Thurs 9am 7.30pm, Fri 9am 6pm, Sat 9am 1pm. Cas may be recorded Braie, arge print and audio This brochure is aso avaiabe in Braie, arge print, audio or on disk. Pease contact your oca branch for detais or Textphone Uster Bank Ireand Limited. A private company imited by shares, trading as Uster Bank, Uster Bank Group and Banc Uadh. Registered in Repubic of Ireand. Registered No Registered Office: Uster Bank Group Centre, George s Quay, Dubin 2. A member of The Roya Bank of Scotand Group Pc. Uster Bank Ireand Limited is reguated by the Centra Bank of Ireand. Cas may be recorded. ULST728RI 11 September 2015