3.8K CC balance - 6K salary - Ideas?

JesseJames_2

A friend of mine is a bit stuck regarding his credit card balance of about £3.8K as he only has a salary of around £6K.
(He lost his other part time job recently)


The credit card is
Thomas Cook rewards platinum plus
It is now a plain old MBNA card
held for 10+ years with a limit of 4K

He says he has been paying the minimum for sometime now and the interest is almost the same at the payments he makes.
Until recently he was paying around £80 per month, but now in total he pays around £120 per month.
I am not sure what the interest rate is but I think it may be around the 35% mark.


He has card protection around £15 per month
He had recently asked to cancel the protection but was told not able to cancel as that was in the original agreement.
So he has been paying this protection for over 10 years as well.


Now is living back with parents for last 10 years, and on voters roll
Main bank is Clydesdale for over 10+ years.
Salary around £6K and had been living back with his parents for the last 10 years or so.


With his very low salary what would be the best card to get to maximise the chances of transferring the balance to 0%

Any other ideas as to what he should do?

JayZed

JesseJames wrote: »

He has card protection around £15 per month
He had recently asked to cancel the protection but was told not able to cancel as that was in the original agreement.

Really? That sounds highly dodgy to me - card protection is not part of the credit agreement, and I don't think any lender is allowed to prevent you from cancelling card protection. Your friend should put it in writing, send them a letter stating that he wishes to cancel his card protection. If they don't, he should lodge a formal complaint.

I'm afraid I can't really offer advice on the wider problem but I'm sure there are people on here who can. Has he ever tried to apply for a 0% balance transfer card, or at least a card with a lower interest rate?

YorkshireBoy

JesseJames wrote: »

Main bank is Clydesdale for over 10+ years.

what would be the best card to get to maximise the chances of transferring the balance to 0%

I think you've found the answer. Approach Clydesdale Bank.

However, be warned that, at 2.5% of the balance, his contractual minimum payments may be more than he's paying now.

JesseJames_2

My friend actually came round with his newest statement and the actual APR was 27.9%.
Another thing was the card protection was around £31 on that statement, not the £15 that he originally stated.
Balance actually 4K of 4.1K limit.
interest £79, card protection £31, total payable £120 per month, so around £10 was being thrown at the capital.

Small success
The first thing we did was to renegotiate the rate.
His actual APR was 27.9% and is now lowered to 17.9% but the card is now frozen for use.

The other thing we are doing is now asking for the T&Cs for the card protection (also by MBNA). As stated in the opening thread he had asked to stop the card protection, but that was around 5 years ago.

YorkshireBoy, I take it you mean a credit card from Clydesdale - they have a 6 months 0% typical 16.9% card.
At the moment we are hanging fire on that one.

Do you need to have a full credit search to enable the bank to offer a credit card at a given APR and credit limit or would a quote search be sufficient, so as not to leave a search trail?

In light of not getting the Clydesdale card or enough of a credit limit, what other cards would be the best bet for a low earner?

alanf1314

Card protection is not an obligation and hopefully you made a typo by saying its £15 pound a month (it should be that per annum).

CPP, Sentinal etc are outsourced and renewed on a yearly basis...no tie in with the actual card eg Morgan Stanley (CPP) and Goldfish (Sentinal) which are both roughly £20 per year.

davey9998

on £6 per hour he works 1,000 hours which is about 20 hours per week or just under

could he not work longer hours to the normal working week of 40 hours and double his income

also, he won't be having much of a life on £380 per month after the card expenses - why doesn't he get other jobs and work harder, pay the debt off quicker and move on in life?

i am presuming he has kids or an illness? if he has kids then he could get tax credits etc, if he has an illness stopping him from working then he could also get help

JesseJames_2

alanf1314 wrote: »

Card protection is not an obligation and hopefully you made a typo by saying its £15 pound a month (it should be that per annum).

Actually it was £31 last month, it will be the payment protection cover (not card protection as I stated in error) at about 80p per £100

davey9998 wrote: »

on £6 per hour he works 1,000 hours which is about 20 hours per week or just under

could he not work longer hours to the normal working week of 40 hours and double his income

also, he won't be having much of a life on £380 per month after the card expenses - why doesn't he get other jobs and work harder, pay the debt off quicker and move on in life?

i am presuming he has kids or an illness? if he has kids then he could get tax credits etc, if he has an illness stopping him from working then he could also get help

He works 22 hours per week and can't work any more in THAT job.
As stated he just lost another part time recently (about 5 weeks ago).
He also has no kids.
He is looking for more employment, but in the current climate is much harder to find.