Balance Transfer help

kiis102 · 17 August 2017 at 8:58PM

Hi Guys,

Need a bit of help as I'm new to credit cards. My mom has a BarclaysCard (she's had it for years). She just informed me she's ran up £13,000 on it over the past few years. She didn't want to tell me as she knows I'd get pretty annoyed at her considering her wages each year add upto just about £14,000ish

She's paying about £310 every month but £300 is being added in Interest so I think the reality of the situation have finally dawned on her. She hasn't used the card for round about a year but she's struggling to keep up the payments.

I have enough in savings to pay off her 13k in full but I'm hesitant to hand it over unless I absolutely have to.

She didn't know about balance transfers or anything as she's always had the same accounts for everything.

I just need advice on what to do. I'm looking at a Tesco Bank card which has 0% interest for 40months and MSE eligibility calculator says she has 70% chance of getting it.

I want to check, if she gets one of these cards (pays the 2.69% fee) and doesn't use it. Transfers the 13k onto it and pays £300 a month until the 13k is cleared and closes the account, that's it? No more fees/charges right?

lynz68 · 17 August 2017 at 9:26PM

That would work but the chances of getting a £13,000 limit with a £14,000 salary is slim to say the least.

She could apply for two at the same time but again may still not get enough to transfer all of it.

Transfer as much as she can then concentrate on paying whatever is left on the Barclaycard as soon as possible.

kiis102 · 17 August 2017 at 9:43PM

lynz68 wrote: »

That would work but the chances of getting a £13,000 limit with a £14,000 salary is slim to say the least.

She could apply for two at the same time but again may still not get enough to transfer all of it.

Transfer as much as she can then concentrate on paying whatever is left on the Barclaycard as soon as possible.

I did just have a quick look at the Tesco card but it said £1400 Balance Transfer limit, that wouldn't be much help at all unfortunately. She'd need 2 at 6500 each.

Just having a quick look at loans and Admiral do one for 370 per month for 3yrs, total repayable is 13600 which is ok I suppose. It's not amazing but it's a lot better than the current situation.

Any cards with a higher balance transfer limit that may work?

SuzieSue · 17 August 2017 at 9:48PM

kiis102 wrote: »

I did just have a quick look at the Tesco card but it said £1400 Balance Transfer limit, that wouldn't be much help at all unfortunately. She'd need 2 at 6500 each.

Just having a quick look at loans and Admiral do one for 370 per month for 3yrs, total repayable is 13600 which is ok I suppose. It's not amazing but it's a lot better than the current situation.

Any cards with a higher balance transfer limit that may work?

As her income is quite low, she will have trouble getting higher BT limits.

She could apply for multiple BT cards on the same day and see how many she is accepted for, see http://forums.moneysavingexpert.com/showthread.php?t=5459702

She could then transfer as much as she could at 0%. It would ruin her credit rating, but if she doesn't intend to get a mortgage or any other loans then it shouldn't matter too much.

lynz68 · 17 August 2017 at 9:51PM

Was that £1,400 limit not just an example though usually you don't know your limit until you actually apply.

As for a loan getting a £13000 loan on a £14000 income is highly unlikely.

SHill · 17 August 2017 at 9:59PM

Before you do anything

First check her credit history file...with her permission..

So you can see where she is with her credit history..then she must go through her payments in & payments out.

She must need to do financial review so she can afford the payments and checks if owes anyone else.. then check if she paying too much for other things insurances, car, shopping; clothes and food...

Go on the debt free wannabe forum...it will help your mum...and you too.

My advice would be that you saved hard for your savings and just to bail out is a quick fix but what if she continues to spend more again you cannot bail her out...again..she need to learn good money management.

Contact citizen advice bureau...so they can help and support you both..

It may take a while to sort out but good careful planning will help you both did reduce the sleepless nights.

kiis102 · 17 August 2017 at 10:27PM

SHill wrote: »

Before you do anything

First check her credit history file...with her permission..

So you can see where she is with her credit history..then she must go through her payments in & payments out.

She must need to do financial review so she can afford the payments and checks if owes anyone else.. then check if she paying too much for other things insurances, car, shopping; clothes and food...

Go on the debt free wannabe forum...it will help your mum...and you too.

My advice would be that you saved hard for your savings and just to bail out is a quick fix but what if she continues to spend more again you cannot bail her out...again..she need to learn good money management.

Contact citizen advice bureau...so they can help and support you both..

It may take a while to sort out but good careful planning will help you both did reduce the sleepless nights.

Thanks for all the advice and info from you and everyone else. You guys are all great. Will definitely look into everything. Thought I didn't have many places to turn but got more options now.

She was pretty emotional when she told me, came out of no where. You're right, I worked hard for my money and was saving for a deposit on a house so it's going to set me back a few years if I even hand a few grand over, nevermind the 13k.

Plenty to look into, thanks guys.

[Deleted User] · 17 August 2017 at 10:44PM

Unfortunately with an income of 14k and debt of 13k she won't get a loan or new card from anyone, whatever you do don't lend her the money, money and family don't mix very well. She could talk to step change the debt charity for advice, she may even qualify for a DRO.

MaudeLebowski · 25 August 2017 at 4:50PM

I definitely recommend her (or you on her behalf with permission) getting in touch with Step Change. Or even using some of the templates available online—a friend was in a similar situation last year and used a template letter explaining her situation and asking creditors to freeze the interest on her accounts. She was successful-she had to send a statement of particulars detailing how much she could afford to pay, along with a bank statement or 2; but you can be a bit flexible with the numbers to ensure that she's not struggling in the day to day.
This procedure did put her accounts into default but it gave her breathing space to actually deal with the debt rather than just the interest. Might be an idea?

SHill · 25 August 2017 at 5:29PM

Your mum has had her light bulb moment.

Of course it is only natural to feel anger and sadness about what has happened.
It take a while to sort out but with planning and care it can get sorted.

Don't feel that you hot to sort the whole thing out your self your mum has admitted to the mistake so she must face up to be responsible.
She must follow up appointments at banks and with charitable organisation like Citizen advice Bureau her self or she will still be nieve to what she has done. It be difficult few months. Especially the run up to Christmas as I guess she may feel the need to splurge.
Tell your nearest and dearest that things will have be different at Christmas and new year.
Look through the forums pages and find good saving/spending advice too.
Make sure your mum writes down every spend (keep receipts) and ask her to try a spend challenge.

Dobbibill · 26 August 2017 at 12:44PM

OP - do not pay off your Mum's debt with your savings.

The emotional knee-jerk reaction is to do it - it's so tempting because you love them but it doesn't help them to help themselves.

You've already had really good suggestions above.

Get your Mum to fill in a SOA.

She needs to know why she has the debt - if the reason is not addressed there's a good chance it will happen again.

Balance Transfer help

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