Time to take my head out of the sand!

System

Shinji - if you do what frugglewump says you'll immediately start saving money.

Prior to making any Balance Tfers, I'd first phone ALL of your credit card companies and ask what are their best rates available to you. You're lucky in that you really have the freedom here for some serious card tarting! Make sure you let them know that.

If you say something like "I'm re-organising my finances at the moment and I’m in the process of cancellling my worst performing credit cards. I really like my XXXX credit card BUT I've got a lot of available credit on other cards, most of which are at better rates than you're currently giving me. I'd like to know what the best rate is you can offer me..." (Wait for answer and if their offer is greater than 0% haggle all you can. Remember you've still not transferred a penny, you're just doing the ground work. Find out how long they'll keep the offer open and then do the same for your other cards.

Other thoughts :-

Make sure you're just using one card for your purchases and the rest for balance tfers. Would the Barclaycard be sufficient for your day-to-day expenses plus your business expenses? If not see if Barclaycard will increase your credit limit. This will free up your First Direct card for card tarting, it also makes it easier to keep track of your expenditure if it’s all on one card and that’s something you really do need to start doing.

If you follow frugglewump's advice, you'll still need to rethink your options in a few months time when the special offers revert to full APR. I believe there’s a handy reminder function somewhere on here ?? so that you don’t forget.

Because of this, you need to retain some flexibility to allow you to balance tfer again with ease. If you leave your MINT and Morgan Stanley cards at £0 they’ll be fighting to give you sweeteners to go back to them!

For that reason, I’d not get rid of your MINT card for the time being – it may prove very useful in a few months time.

However, the flipside of keeping all these additional cards is that your available credit on your Credit File will be approx £40,000. Some companies may not bother to offer you future “0% Introductory Rates Deals”, which are every card tart’s dream whilst this figure is so high. You can immediately reduce it by phoning up the companies and asking for your credit limit to be reduce to one of your choosing, but of course then you don’t have the great flexibility you have now.

My gut feeling here would be leave the Credit Limits for now and lower them after next April.

Right, just a couple of other things:-

It’s generally not a great idea to bank with the same firm that you owe a load of money to (in case the worst ever happened and they dipped into your current a/c if you couldn’t pay your loan or credit card).

As you seem fairly stuck with the First Direct bank loan, consider opening a bank a/c with someone else. Use this list to make sure it’s not with a company you also owe money to on your credit cards:-

http://www.stoozing.com/cards.htm

Finally, are you managing to currently stay in credit at the bank each month or do you also have an overdraft which needs paying off?


That’s me done, hope some of the above helps and sorry for the long post!

Best of luck

Dave

Shinji_2

Thanks Dave!

Right, no overdraft use, my overdraft limit is only £100 anyway.

I can't change where my salary is paid into.

I have a Nat West current account that's got about a quid in it (since about 1994 lol), so I could always restart this account if needs be, but it'd mean transfering a bunch of cash to it each month, then transfering all my direct debits to it??

System

Shinji wrote:

Thanks Dave!

Right, no overdraft use, my overdraft limit is only £100 anyway.

I can't change where my salary is paid into.

I have a Nat West current account that's got about a quid in it (since about 1994 lol), so I could always restart this account if needs be, but it'd mean transfering a bunch of cash to it each month, then transfering all my direct debits to it??

Pleased to hear you're not living by your overdraft.

Can't see why you say you can't change where your salary is paid into. (Unless that's a term in your bank loan?) The idea behind opening a new bank a/c is to to move all of your existing salary credit, direct debits and payments and standing orders to a new account and close your First Direct a/c. It's simple "future-protecting" yourself in case the worst happens. Even if you don't feel the need to do it now, always have the idea on the back-burner as you're sorting your debts out.

Re. your old NatWest Current a/c, as noted on that "Stoozing" list, the NatWest is owned by the Royal Bank of Scotland group who also operate your MINT card. So while you owe money to MINT, you should never deposit money with NatWest.

If you decide to close your MINT card, then moving all your existing salary and other bank transactions to your NatWest a/c would be a sensible idea.


BTW, I haven't worked out what you'd be saving if you followed Frugglewump's earlier suggestions, but by shifting such a large amount from cards charging APRs of 16% or 17% to new deals, you should easily be saving between £100 - £200 each month, which takes care of your "budget deficit". By checking on MSE Forums, you'll probably be able to reduce your budget even more.

Shinji_2

Hmm, that 100 to 200 pounds per month needs to go to paying off the cards though.

If I keep paying the minimum, then they'll never go down.

I'm going to stay in as much as possible over the next 5 months while they're on low APR and pump as much as possible into reducing the balance on the cards.

Should I split this money equally over all the cards, or should I just pump the extra into the highest APR card (I think this will be Cahoot once I've transferred the balance over to it)?

Thanks again

mariejader

"I think my PSP will have to go around Christmas time as I don't use it much any more (now that WAS an impulse buy if ever I've seen one!). I'm waiting until all the shops run out of stock LOL! "


Now is a good time there is no stock and what little stock is available is already pre-ordered.

I know this from experience this week, the shops are full of empty dispaly boxes with no confirmed idea of when new stock is arriving.

Get it on e-bay I am sure you will probably get more than you paid originally

frugglewump

Shinji wrote:

Should I split this money equally over all the cards, or should I just pump the extra into the highest APR card (I think this will be Cahoot once I've transferred the balance over to it)?

Well the snowball calculator can help with that.

Personally i would pump the money into either the MBNA or Egg card. My reasoning is that

(i) either you will BT again in april reducing this debt will reduce the BT fees.
(ii) or if you don't/can't BT the rate on these cards will shoot up way above the cahoot one.

Something to consider is that these 2 cards have the highest limits - doing a BT off these elsewhere will probably have to be done in more than one lump unless the balance decreases enough and multiple BT fees rather spoil the idea. This does assume you can't increase the limits on your other cards - which is entirely possible.

System

Shinji wrote:

Hmm, that 100 to 200 pounds per month needs to go to paying off the cards though.

If I keep paying the minimum, then they'll never go down.

Agreed, but at least you should have enough to get by on each month.

As you've never really (I presume !) properly budgeted, I'd give your budget a month or so to make sure you've included everything in it. You're bound to have forgotten something. When you have a really accurate budget worked out, you can then decide how much you've regularly got in cash to reduce your credit card debt. There's NO point trying to reduce the debt too much too soon if it means you run out of cash and then have to put something on a credit card.

Should I split this money equally over all the cards, or should I just pump the extra into the highest APR card?

You're priority should always be to reduce the highest %age APR debt first, and for the rest, just pay the minimum amount.

Once you get everything set up and if you keep checking out the forums for moneysaving ideas, you should be fine.

Shinji_2

Hey everyone

Really sorry I've not been around since I initially posted this up last year.

I've been rubbish and didn't use any of the advice given here... I just went back into denial mode and kept spending

A month or so ago I met a girl who is absolutely amazing and after a while we felt comfortable enough to talk about pretty deep stuff, and my debt problem was discussed. She took it really badly (as being in debt can't be the most attractive attribute someone can have!) so that was the KICK I needed to make me want to sort this out once and for all. We're still in contact a lot, and after the initial rejection, we're now really good friends and she's been helping me to get through the initial pain of telling my friends and family about my problem.

Anyway, I called CCCS and went through the interview with them... Sorted out my budget and worked out that a DMP was the answer.

However, I work for a bank...

I owe money to a subsiduary of this bank, and I also get my salary paid into this subsiduary.

CCCS told me to get a basic bank account and to have my salary paid into that, so that the subsiduary can't get their hands on it, but part of my T&C of employment state that I have to have my salary paid into one of their bank accounts. I have set up a basic account with the bank, but CCCS advised that the subsiduary might still be able to take payment for the loan and CC that I have with them. Neither CCCS nor my employers know whether they'd do this or not, but I don't want to take the risk, as this would mean I couldn't go on a DMP and then I'd be in trouble.

Another thing I'm not so happy about is that in the CCCS DMP documents, they mention CCJ's and the fact I won't be able to get credit for a further 6 years after the debt is paid off... This will mean no credit for 11 years if I did go on the DMP. That sucks, as when this is all paid off, I'll want to get a mortgage and a new car!

SO:

My Mum has offered to pay my loan off for me... With the agreement that I'd pay her back once all the other debts have been paid for.

I then want to tart my cards and try to pay it off this way.

At least then, if I do need to go on a DMP in the future, there won't be any issue with my bank/employer (they are ok with me doing a DMP, so long as my line manager is informed).

Anyway, sorry for the long post, but here is my current state of affairs:


Salary: £1587 per month net

CCCS Approved Budget: £766 per month

That leaves me with £821 per month to pay my debts.

I currently owe the following (minus the loan that my Mum is going to pay off):

Credit Cards:

Card
Type
Balance
Credit Limit
Minimum
APR

Egg
Green
£5,005.28
£13,000.00
£102.15
15.9%

MINT
Standard
£8,981.79
£10,000.00
£202.00
17.9%

Cahoot
Standard
£0.00
£7,000.00
£0.00
9.8%

MBNA
Platinum
£7,322.18
£15,500.00
£102.85
16.9%

Morgan Stanley
Gold
£1,785.33
£7,100.00
£36.00
15.9%

First Direct
Gold
£2,591.19
£5,100.00
£70.00
14.9%

Barclaycard
Standard
£767.18
£2,450.00
£19.00
0.0%

Create (Lloyds TSB)
Standard
£3,002.28
£8,200.00
£61.00
12.2%

TOTAL CC Debt: £29,455.23
Total CC Credit Limits: £68,350.00
Total CC Minimum Payments: £593.00

Car Loan:

Initial Amount: 12250
Term (Months): 60
Payments Made: 22
To Go: 38
Balance: 9486.28
Settlement: 8510.91
APR: 8.9
Montly Cost: 248.06

That makes a total of £841.06 per month, £20 more than I've got to spend... But a hell of a lot better than having another £350 a month if my Mum wasn't sorting me out.

Basically, I've been getting into roughly £5k a year extra debt because I've been putting a lot of everyday stuff on my cards because I can't afford to pay for them due to me paying so much of my salary towards my debts... That and I've been buying consumer stuff to try and enhance my life... Yeah right! The CCCS Budget has catered for pretty much everything that I can think of, so I really shouldn't need to use credit at all. I know it's going to be tight, but I'm ready to sort this out.

Anyway, the tarting plan that you guys did for me last year probably isn't relevant now, so could someone please work me out a way of getting out of this situation, without going on a DMP.

I reckon there must be a way of doing it!

I PROMISE TO TAKE YOUR ADVICE THIS TIME... I NEED TO GET THIS SORTED.

The DMP was going to take 5 years to sort (@ £821 per month). I can live with this amount and this term, but now that I don't have the extra £12000 on my total debt, I reckon I must be able to sort my £29500 cards debt out with £573 a month?

Is it possible?

Many Many Thanks in advance!

gallygirl

Welcome back! I hope that this time rather than have a lighbulb flickering moment it stays full on!

I am no expert on the tarting side of things, but a bit of general advice. You MUST take control of your life - it's cost you what could have been a great relationship - you MUST NOT let this happen again.

OK - no pain, no gain. Make a list of all the 'c**p' you've bought over the years and put it on ebay. Chuck that at your debts. It's not yours to keep as you haven't paid for it and frankly don't deserve it.

Same with your spending - you need to get a grip of it. Start writing down EVERY penny you send - it's a pain, but done properly will have 1 of 2 results:
1. you'll realise a pattern of where you're wasting money and stop it, or
2. you can't be bothered to write it down so won;t spend it in 1st place!
but only IF you do it properly!

Right, will hand you over to the experts now. A lot of time & effort went into trying to help you last time round. DO NOT waste their time again young man!!!!! (assume you're male?)

ps good luck by the way!

Shinji_2

Hehe, Thanks!

I WILL DO WHAT I HAVE TO TO GET THIS SORTED.

(I've already sold a lot of my stuff, so unfortunately don't have much left I can sell on eBay I'm afraid )

Lightbulb is on, and bright (but is an engergy saving bulb LOL).

Anyone else?