Advice please!

Smartass43

Hi! This is my first post, just looking for some advice. My OH and I have managed to get into a bit of debt, which on my part is under control, but I'm worried about OH as his just seems to be spiralling. My overdrafts/credit cards are all interest free, although the largest one runs out in January. OH's are all high interest. He applied for a 0% card about 7/8 months ago but was rejected.

What I'm really wanting to know is whether anyone thinks it is worth applying for a bank loan given the present financial markets? I feel that if we had a steady monthly payment coming out just like any other monthly Direct Debit, we would be in more control and would cancel all other access to credit once an emergency fund has built up.

I'm worried my desperation and impatience to be debt free will mean I'm not thinking things through properly, and will end up being refused the loan, ruining my credit rating and getting more depressed and more in debt!

We have already scrutinised our SOA and everything that's not fixed has been reduced. I'm so fed up of thinking about money I never seem to be happy anymore.

doodledo_2

Hi and welcome to the forum. You have definately come to the best place for support.

Taking out a loan to cover debts isn't always the best option. I have done this twice now and just ended up with higher debts, although obviously not everyone does this.

Plus you have to think that by taking out a loan in your name or joint to cover both your debts this ties to his debts as well as your own.

I would post your SOA on here using this link http://www.makesenseofcards.com/soacalc.html and we can see if we can reduce you outgoings. Its amazing what people on here can tell you.

Make sure you list all your debts and the APRs too so you can work out a plan of action for paying them back.

I suppose a big question is whether your OH has had his LBM (lightbulb moment). Does he actually want to deal with his debts, because if not you may be fighting a losing battle and be better dealing with your own debts.

RAS

hi

Get him to check his credit record to see if there is a problem.

Then set up DDs to make the minimum payments to each account.

Check if he has PPI or charges on any of these accounts and reclaim them if appropriate (the halt in bank charge reclaim does not affect CCs, catalogues and loans).

Then make a budget and throw everything you have at the most expensive debt. See the snowball on wwwwhatsthecost.com to see why this works better.

CAFCGirl

Only want to echo what was said above really.

You sound like you've got your head screwed on, and know what needs to be done.
Can you suggest to OH that he checks out his credit report, there may be something on there which is stopping him from benefiting from reduce rates etc which could be easily rectified.

I recommend posting a SOA as sometimes even when you think you've cut everything you can, someone can see something you cant.... I'm regularly posting up my SOA as sometimes I cant see the wood for the trees.

I would also urge you against applying for a consolidation loan as Doodledo said even with the best intentions its all too easy to re-spend on the credit cards and then end up in an even bigger mess.

And have yu asked your OH how it feels about the whole situation?

Smartass43

Hi, thanks for replying. We checked the credit reports yesterday. There's nothing on there that shouldn't be, the only thing I can think of is that his said he was using 97% of available credit. Other than that everything was green and up to date!

I will sit down with him sometime this week to do SOA, I can't really do it on my own as we each have our own bank account but use a joint account for household bills, so I need to know exactly what his costs are. I know if I knuckle down I can have my debts cleared in 12 months or less, but I'm more concerned about him.

He knows it needs sorting, he suggested the loan! But he's also very proud and hates the idea of me helping to pay his debts, since he was the one who ran them up!

I really don't want to go down the loan route, for the reasons you've said. Do you think it's worth applying for another interest free card, or do you think the refusal earlier this year will affect my chances? He is an associate on my credit check as we have a joint account and a mortgage together.

Thanks for your help!

CAFCGirl

How much debt are you in exactly?
Can you post a breakdown of the debt, i.e to who, how much and the apr's and minimum payments? even if its just yours and then when you sit down together to do a full SOA you can post that.

Is he still using his credit? Thats probably the first thing I would suggest he needs to get in control of, theres no point paying it off and working like a dog to do that if you then struggle later in the month and then revert to using it again (plus a bit more).

Remove all day to day access to credit,cut up the cards, take them out of wallets/purses and live solely on your physical cash..

Its good of your OH to want to sort his situation out on his own, and if he would rather do it with his own cash, you can at least help him out in other ways, perhaps when your own debts are paid off (which you should really concentrate on for yourself) then you can offer to pay a greater % of the household bills so he has more free cash available to pay off debts (providing he does pay it off and doesnt fritter it elsewhere)

In short....... get that SOA up so we can really help