Help needed...

JoshThomas

Hi there,

I am looking for some help!

I am a recent graduate, who whilst at University - have completely ruined any credit worthiness I may have had. I had no regard for paying my cards/bills on time and have completely ruined my credit score. Now - I have realised this - I am trying to do something about it!

Let me tell you a little more of my situation...

I have 2 credit cards - one which defaulted for £1300 a couple of months back but I will have paid off in full at the beginning of January via a collection agency.

I have another that is over the limit - but have been put on a payment plan until I can start paying it off - this is at about £750.

I have one store card with about £250 on it - and im currently paying the minimum off each month. I don't have a problem with cancelling this and cutting it up.

I have one student overdraft of £1700 and another of £1300 - both are interest free for 3 years.

I SHOULD be recieving a bonus from work next August of about £6000 which I plan to pay off all of my overdrafts with.

Basically what I am asking is the best way to obtain some credit/loan - so I can not only consolidate my debts on my cards - but have a little extra cash to...

a) have a deposit on a flat (£600)
b) buy a few bits of furniture for the flat
c) possibly buy my girlfriend an engagement ring (but this may have to wait until i recieved said bonus!)

Can anyone please suggest anything I should do...

Magentasue

So in January you will have two cards to pay off - total £1000. Pay these off as a priority then in August you will be able to clear your overdrafts and have £2000+ leftover.

My answer would have to be - wait til August before you buy furniture and rings.

Robert_Sterling_3

Remember that the bonus

a) Is not certain.
b) Will be taxed .... Tax in the region of £1452 eventually
although in the month that you get it and using the
PAYE system will be more than that but the extra taken in
August will reduce the amount paid in September to March.

JoshThomas

Yes I will have £1000 left to pay on cards - but I would like to pay them off NOW and consolidate my existing debt.

I would like to move in with my girlfriend in February as thats is the maximum time I can stay at my friends for - I also can't move back home as they live 2 hours from where I work - and it means paying £300 a month in travel anyway!

If paying off my cards monthly until then - it means I will not have enough for a deposit on renting another flat...

JoshThomas

Robert_Sterling wrote:

Remember that the bonus

a) Is not certain.
b) Will be taxed .... Tax in the region of £1452 eventually
although in the month that you get it and using the
PAYE system will be more than that but the extra taken in
August will reduce the amount paid in September to March.

It is not certain - but its about 85% likely as it was a major factor in taking the job.
The bonus is actually £9000 - I worked out a rough guess of £3000 tax and NI....

Magentasue

But you won't be paying the cards off ... you'll just be moving the debt elsewhere.

Robert_Sterling_3

JoshThomas wrote:

It is not certain - but its about 85% likely as it was a major factor in taking the job.
The bonus is actually £9000 - I worked out a rough guess of £3000 tax and NI....

OK

I will go for £2800 tax and NI in that case

However they will take rather more than an extra £2800 in August
and it will eventually sort itself out by the end of march.

JoshThomas

Ok thanks people.

I know its the best advice you can give, as I am just moving the debt. But I really need some funds for a deposit on a flat - any ideas?

Magentasue

By your own admission, you have a poor credit history which means you will find it difficult to get cheap credit. If you pay the minimum on your cards (keeping to your arrangements), can you save up some/all of the £600 deposit for February? Or get an evening or weekend job to earn it?

exessexmum

The problem with consolidation loans is that its very tempting to "just get a little extra" which racks up even more debt.

If you are determined to do the engagement thing (and I'm a girl, I understand the *need* for the ring and all) get her a cheapy Argos £50 CZ ring for now. It looks all shiny for her friends and family and gives her something to show off (which is important to us, shallow yes, but important nonetheless) No-one but you and she need to know how much it cost, and unless any of her mates are jewellers with a handy loupe, then they ain't gonna find out either. Tell her that its only a cheap one but that you were desperate to show her how you felt and that you will replace it with something fantastic when you can afford it. Trust me, she will be thrilled that you thought of it like that and were so desperate to propose that you bought it for her.

Re the deposit on the flat, is there any chance your folks could lend you the money on the understanding that as soon as the bonus comes you will pay them straight back, with some interest? what about your gf? Can she stump up some of the deposit? Or her folks?

I really would not recommend getting any extra credit for the moment, its how I started and I now owe £20K <eek>

Good lcuk

Tracey

JoshThomas

Magentasue wrote:

By your own admission, you have a poor credit history which means you will find it difficult to get cheap credit. If you pay the minimum on your cards (keeping to your arrangements), can you save up some/all of the £600 deposit for February? Or get an evening or weekend job to earn it?

No - as I mentioned in the first post that I am paying off my £1300 defaulted credit card. Two more payments of £340 odd a month with one payment at the beginning of Dec, and the final one at the beginning of Jan... With my current rent of £300 a month and my other debts/card repayments/other outgoing costs totalling £100 a month - I am left with about £500 a month left... so saving for it is not an option.

My hours of work are 9-6 which are tiring enough for me to add another job on top of that.

I'm not looking for cheap credit - just looking for somewhere that will give me a loan - that I will use to pay off my cards - as well as have money for a deposit that will NOT penalise me for paying the full amount of any loan early...ie when I get my bonus.