Virgin credit card - 34.9% extortion...help

debtdesperado

I have just under £10,000 worth of debt on a Virgin credit card. The rate was previously 20.9% and I have been servicing the minimum and trying to make overpayments.

Yesterday I got a letter saying that the interest rate was going up to 34.9%:eek: :mad:

I feel as if I'm NEVER going to be free of this debt, and doing the snowball calculations left me in tears. I had a sleepless night trying to work out what to do - does anyone have any good suggestions?:

1. I have about £2,000 remaining of the maximum limits on other credit cards, so I thought I would balance transfer this amount from the Virgin card. They won't be interest free, but the interest rates are around 20.9 so less than Virgin.

2. I recently tried getting the credit limits increased on my other cards - no joy there.

3. I thought I would try getting a low percentage loan/credit card for a couple of years to pay it off (on the snowball calculator, paying off £500 a month would take 30 months and cost me nearly £4,500 in interest) but this might be difficult if the criteria for lending have tightened...

Does anyone have any other suggestions for how I could get this rate down (zero of course would be great, but I'd be grateful to get it under 20%....)

And has anyone else had a similar letter recently??

milliemonster

This has happened loads with virgin/mbna, I doubt they will reduce your interest rate, it sounds like if you can't get any of your other creditors to increase your credit limit, it's unlikely you will get another credit card on low interest/interest free.

If you have £2000 on another card, you can BT some off the virgin card onto this one, but remember you will only be able to go to 95% of the maximum credit limit on your other card and you will be charged a BT fee usually around 3% aswell,

Your best bet is to budget carefully and throw all your spare cash at the virgin card to clear it asap, can you post up an soa?

boredofbeingathome

Well i would try and speak to their customer loyalty dept..and get them to keep it at the same rate or lower if you can. They sometimes respond to that. Keep calm when ringing them and be matter of fact about it.

I would certainly look at switching things around...and very carefully budget to see what else you can throw at the card.

If they do agree to keep it at the same rate this will be for about another 3 months, and then they will try again..just from my own personal experience.

Good luck
BOB

firesidemaid

it is worth ringing them and asking them to reduce it back to what it was - they may agree to somewhere inbetween. say that it is extortionate and not helping that you will have to move (some of) it to other cards, making them less money.

good luck x

GingerSte

firesidemaid wrote: »

it is worth ringing them and asking them to reduce it back to what it was - they may agree to somewhere inbetween. say that it is extortionate and not helping that you will have to move (some of) it to other cards, making them less money.

good luck x

Just make sure you do this before you transfer the money to the other card. Then transfer it anyway. :rolleyes:

Miss_Piggy_2

My husband had the same and they won't reduce the interest rate. This is what pushed him over the edge into a DMP!

Regards

Miss P
xx

longforthesun

We had 2 MBNA cards owing Approx 16k between them. Interest rate was really low about 14% then slowly increased to about 20% then they hiked it up to 33% on both we could no longer afford to pay the min and this forced us onto a DMP.

As others have said it may well be worth calling them and asking them to lower it they can only say no you then have the option to BT onto the other cards. Good luck.

debtdesperado

Thanks everyone... it doesn't sound as if there is much to be done - fingers crossed they at least keep it on the same rate as before, even for a little while.

Will try calling them and let you know what they say - thanks for the help.

What a horrible company to deal with... none of my other cards seem to be quite as aggressive with interest raises.

What is interesting is that a couple of months ago I wanted to set up a direct debit payment for a flat amount of £200 each month, only to be told Virgin could only set up a DD for the minimum or the maximum amount....

I don't know who I'm more cross at - me for getting into this mess or them for making it worse....

coolcait

If you live in Scotland, you could look into the Debt Arrangement Scheme www.moneyscotland.gov.uk.

It works in a similar way to a DMP, in that you make agreed payments to all of your creditors. However, by law, creditors MUST freeze interest, fees and charges - and they'll be written off when you complete the programme. Creditors CAN'T take any kind of legal action against you when you're in a DAS programme, and your home will be protected.

I know I sound like a saleswoman when it comes to DAS , but I think it's a great scheme for those who are eligible. And it's free.

The first step - as ever - is to have a word with your local CAB or local authority money advice team.

HTH

beanielou

You could set up a SO to Virgin to make up difference between dd & what you want to pay.

GeorgeUK

I would post up a SOA as advised and also get a copy of your credit report (free at experian if you cancel within 30 days).
https://www.makesenseofcards.com/soacalc.html

Make sure that you don't have too many credit checks against you, then perhaps you can try for another 0% card when you have had no credit checks for about 6 months. You can usually have about 3 credit checks in a 6 month period before your credit score is affected.