How Do I Get Out of This Debt!

PT66

After a combination of divorce, self employment and unemployment, I find myself with over £26500 owing to 3 different credit cards. I am now lucky enough to be in a farely well paid job and have paid back all of my credit card arrears. The problem is this however; I am paying back almost £600 per month across the 3 cards, which is more than the minimum but 75% is only covering the interest. As a result of the missed credit card payments when I was unemployed, my credit score is very poor so I cannot apply for loans or 0% cards. Have looked at IVA's but I am really trying to rebuild my credit history and not damage it further. Any ideas?

pepe2008

Be very wary of IVA's, they are not 'sold' for no reason. They are not the right solution in most cases.

Jesthar

Hi PT66, and welcome!

Could you put together a Statement of Affairs for us when you get a moment? If you use the handy calculator here:

http://www.makesenseofcards.com/soacalc.html

choose, the 'MSE' buttong in the format post section near the bottom, then post it up here, the lovely residents of this board will be able to give you advice on what to do next.

~Jes

GeorgeUK

Have you tried getting a credit card recently, or have you assumed you will not get credit? You can have about 3 credit checks in a 6 month period before it affects your credit score. Do you know when your last missed payment was? If it was about 6 months ago, your score may have improved a bit. Possibly worth checking you credit file (free at experian if you cancel within 30 days) to see how things look. Also make sure you are listed as bing on the electoral roll and that the address is correct.

Usually it is best to pay the minimum towards all your debts and throw anything left over at the highest APR. If you have a card with a relativeley low balance and the limit can take about 75% of one of your other cards, it may be worth trying to tackle that one first however. As an existing customer you may be offerred an incentive to keep your card open especially if you have a nil balance. You could be offerred 0% for 6 months or a low interest life of balance - as an existing customer, this should not require a credit check, but it would be best if it was a card that you hadn't missed too many payments on.

If you post up a statement of affairs (SOA) we may be able to suggest some areas of your expenditure where you can make some savings. This calculator is helpful to see how much you should have at the end of the month. If you don't have the amount you should, keeping a spending diary may identify any areas you are losing money that could be better spent.
https://www.makesenseofcards.com/soacalc.html

PT66

Thank you for the advice. I will put together the SOA and post again. I am a member of Experian and check my report on a regular basis. I have about 4 monthsd now of being totally up to date so maybe I need to wait a bit longer to apply for another card - and I need one that would give me a large enough limit to transfer the balance.

Numpty_Monkey

To go along with what George said about paying the Highest APR first have a look at the snowball calc
http://www.whatsthecost.com/snowball.aspx?country=uk