Credit Card with bad Credit?

Wayne-Kaz

Hi all

I have horrendous credit. Not the amount so much (around £5k is all), but who I owe it to - people like high interest creditors... Welcome Finance etc etc

What I want to do is to get a CC, and pay off as many of my existing debts as I can. That way I'm killing 2 birds with 1 stone - I'm "consolidating my debts" as all the adverts say, and since I'll be paying off the CC bill regularly each month, I'll be slowly raising my credit score as a "good payer"

Unfortunately, I seem to be in a catch-22, since my credit is bad, I can't get a CC. Even Capital One turned me down!

Advice please...

M_Ryan

There are CC's that MAY accept you BUT.... if you have a s bad credit as you say, you are likely to only get low credit limits from them! (possibly around £250 per card! On this basis you would need 20 different cards to pay it off!

AND.....the cards you get will probably be around the same interest as you are pay WF.

I don't believe that this is the right option for you!

Have you tried talking to your bank for a loan? If you explain your circumstances and your credit isn't TERRIBLE, they might help you.


Matt

Wayne-Kaz

Due to circumstances, part of that debt is also a loan with my bank, so I'm pretty certain they wouldn't agree to refinance that loan (again!) even if it helped me to get straight

Thx for the quick answer tho - appreciated

ICan'tStandIt

Wayne-Kaz wrote: »

Due to circumstances, part of that debt is also a loan with my bank, so I'm pretty certain they wouldn't agree to refinance that loan (again!) even if it helped me to get straight

Thx for the quick answer tho - appreciated

Will you be looking to pay off the credit card in full each month ?

From the sounds of things, I'm not sure you will be doing that so a credit card could be a bad idea as the APR can be quite high if for people with a bad history.

Try people like Monument or Aqua but make sure you fully understand the implications of a high APR before taking one out and using it.

Good luck !

Wayne-Kaz

ICan'tStandIt: No, that would be unfeasible. I know I can afford to pay around £450 a month, so ~£400 per month off my debts with charges on top would be manageable

Would mean I'd be out of debt in no time too

I just want to get to a stage where I'm paying a single charge each month - just for my own sanity!

benf90

If it does end up that you're stuck with your existing lenders for the time being and unable to transfer the debt elsewhere then a trip over to the Debt-Free Wannabe section of this forum may be a good idea.

It may be a good idea anyway. It's full of people that can help with the financial side of things like which debt to clear first etc and also people that can suggest practical solutions to saving money which can then be used to clear the debt even quicker.

ICan'tStandIt

I'm not sure where you would get a credit card that would start you off at £5,000 limit if you have a bad credit rating.

Have you tried negotiating a better deal with your existing lenders ?

Wayne-Kaz

Well, one debt is the dreaded Council Tax, but I contacted the debtors for full details, and it seems the local council are trying to stiff me for multiple locations for the same period, so when I get that dealt with, that'll save me about £1k or so

Welcome are very good - as long as I stick to my current plan with them, they'll knock a whopping chunk off (about a third)

It's just all the little piddly ones that add up, but cause so much paperwork between them. Would be much easier to be able to pay them all off, and repay to one place

But thanks for all your advice. Have spent the evening trawling thru the DMP forum and making lots of notes!

gwenstefni

People with poor credit ratings are viewed as very high risk; most lenders would rather not take a chance on them. This practice can leave out a lot of people because, besides bad borrowers, it's not uncommon for perfectly responsible people to end up with poor credit ratings due to unforeseen circumstances or events out of their control.Credit cards for people with bad credit allow just about anyone of legal age access to credit, whether you've had CCJ's, defaults, mortgage arrears or are simply new and have never borrowed before, bad credit card issuers will consider you, and except in extreme cases such as a previous bankruptcy, your chances of approval are high.

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Gwenstefni

Guaranteed ROI

Wayne-Kaz

I've just received an email from "Yes Loans" (I assume these are the old "Yes car credit" company?) Stating that they can find me an unsecured loan

After checking their website out, there is no info on any kind of interest rate or repayment. Are these likely to be the 5.5% monthly interest rate, like Welcome are?

I'm still seriously tempted to consolidate, but not if it ends up being 70-odd% interest a year which is what Welcome worked out at when you add all those monthly 5.5%s up..!

Obukit

Hi Wayne,

Any unsecured loan, including credit cards, are likely to be either very low credit limit, or very high interest, or both, considering your poor credit history.

Have you spoken to anyone in your family and asked them if there's anything they can do to help? If they have a better credit rating and are happy to apply on your behalf, this may be a way of getting on top of your debts. However, if you do this it's obviously crucial that you make an agreed repayment every month without exception.

If you can't do this, why not write down a list of all your debts, the minimum monthly repayment and the rate of interest. That way you can work out which loans are costing you the most each month, and target them in turn. This will give you goals to work towards, and will help minimise the cost of your debts. However, in the nicest possible way if you're in debt already getting more expensive debt to "pay" them off is something you should think about really carefully - you say you're "only" £5k in debt but this is a lot of money, especially as we are heading for an economic downturn which means jobs and wages will be under pressure. Be sure you don't overstretch yourself and are prepared for a rainy day if required.

Have you filled out a statement of affairs or done a budget? If you posted either of those to this thread we'd be able to give better advice on how to deal with your debts.