Getting rid of £11k's worth of debt... Help!

angelinaballerina25

Hi!

My boyfriend has a debt and is currently struggling with his monthly payments. The first part is a credit card debt of about £2,500, of which he pays £70 a month (including interest). The other part is a loan from HSBC for £9k, which costs him £300 a month. Together, this is getting too much and although he hasn't added to this debt for ages, it is eating at his monthly outgoings so much that he is skint the first week after getting his paycheck.

Any tips to reduce the monthly repayments? He says he tried to renegotiate with HBSC, but they refused to change the terms. Obviously, he'd like for his credit rating to remain good and doesn't want to just default.

Any tips to make get him a little bit more breathing space each month?

Thanks!

mrcow

Firstly - do not default.

You need to get him to draw up a budget. How much does he earn? What does he spend it on each month.....it isn't just the loan and the credit card, that's for sure!

Also, what's his credit rating like? If he keeps it good, then he has lots of options open to him. If he starts defaulting, then the options will dry out quicker than if they'd been left out in the sun.

If he's got a good rating, then consider switching his debt to a 0% deal (Capital One for example have 0% until Feb 2010 at present - but they stress that you need a GOOD rating!).

Also he needs to cut up the cards. Right now - and it's non negotiable. None of this is going to work if he's still using them to buy things that he simply can't afford!