Thinking of applying for a Barclycard Initial card

crube

So here's my situation, I have an HSBC credit card which is pretty much maxed out, around £2700. I pay around £80 on it every month, and also around £35 interest. I am currently unemployed and my credit rating isn't the best so I've been knocked back with a few balance transfer applications etc. I really don't use this HSBC card now except for 2 things - my monthly payments to Napster(£9.95) and Screenselect(£12.99). It says on this Barclaycard Inital Application form that there is 56 days interest free on purchases if you pay on time and in full. The main reason I would want this card is to enable me to cut up the HSBC one so I could simply concentrate on repaying it, and put the Napster/Screenselect monthly payments on it. Also it's there if I ever need it if cash isn't available and I need to spend. My credit rating definetely needs some building too, and although this rate is 27.9% APR, which is obviously high I think it may be benificial in terms of saving money as I would only ever use it as a last resort because of that high rate. I'm really struggling to make any progress in paying off my HSBC card at the moment and if I got this one I've made a promise to myself to cut it up.

What do you think? Bear in mind a Balance Transfer for me is basically impossible so this is perhaps currently my best chance to get the HSBC card down.........

The_Boss

You've got to ask yourself - would they risk lending money to someone who is unemployed? I dont think they would give you the card with no obvious means to repay it, and if they did, the limit might be only £500. Also going against you will be this combined with the fact they will see that you already have a card that is maxed out and the fact you say your credit record isnt that good.

It might help if you opened a bank account at the same time, but being unemployed I'm not sure this would help much either.

crube

The_Boss wrote:

You've got to ask yourself - would they risk lending money to someone who is unemployed? I dont think they would give you the card with no obvious means to repay it, and if they did, the limit might be only £500. Also going against you will be this combined with the fact they will see that you already have a card that is maxed out and the fact you say your credit record isnt that good.

It might help if you opened a bank account at the same time, but being unemployed I'm not sure this would help much either.

Well, normally I'd say you were 100% right but what gave me this idea was that I got a letter from Barclycard asking me to apply and saying I had already passed the first stage of their approval process. If they did only give me a card with a £500 limit I'd be really happy with that. Part of my problem with the HSBC one is that whenever I've asked them to raise the limit, they have - it's a little too tempting :laugh:

crube

Anyone else got any thoughts/opinions?

Fedz

As with all - Barclaycard saying that you've 'passed the first stage of their approval process' is a marketing ploy to get you to sign-up and send in a signed application so they can actually do a credit check on you - this stage determines if you get the card or not.

No disrespect too you but, if you are going to get the Barclaycard you're going to have to be highly self disciplined. The fact of having 2 credit card payments per month instead of the one and the temptation of the available credit.

Even if you do cut up the HSBC it doesn't stop you using it as you can always have another card issued and or write down the card details (inc. security code) and use it on-line!

In keeping with the self discipline I'd balance transfer the 75% of the credit limit on the Barclaycard using the 6.9% BT promotion but, I understand Barclaycard prefer you do this only once which will leave you the fact you have the HSBC and the Barclaycard nearly maxed-out!

If you do BT from the HSBC to Barclaycard, you shouldn't then spend on the Barclaycard as you get the debt down as this would sit behind any BT done on the account.

In my honest opinion I think you'd be better concentrating on simply paying the HSBC and leave applying for other cards as this could be adding fuel to the fire.

If you're finding it difficult to not dip into your HSBC as you're paying it off then getting another card isn't going to help - it's tempting but, it's honestly a trap!

I'm sorry to sound harsh but, it's the only way to put it

Hope this helps.

crube

Thanks for your reply Fedz, and I know you're right. Wasn't aware of the BT promotion, it's definetely worth applying for by the sound of it although whether I would get accepted is a big questionmark. Thanks again.

crube

Ian_Griffiths wrote:

The HSBC card is going up by 35 interest, and 23 you are putting on it with subscriptions?

You are paying 80 off, but that is actually 22 coming off the balance of 2700.

It will take you 122 months to get square in the current arrangement. Thats over 10 years.

In that period, you will have put 9800 in to the card. 10 grand

In a strange moment of madness, you have decided somehow taking on more debt at an equally stupid rate is a good idea because it will enable you to squander money on music and DVDs without incurring interest, but you fail to mention getting rid of the bulk of the debt.

My advice?

Cancel the luxuries, move the debt wherever the rate is the best you can get and use your money to pay it off.

Even interest free 2700 at 80 quid pm is 33 months.

At a very rough guess you're probably up to more than twice that with your credit score. You really need to stop spending and start settling.

This 'cut the card up' idea is crap. They can send you new cards. You need to actually do some maths, realise the amount of money that you're throwing away and sort it out.

Unemployed, 3k down and spending 10% of your income on movies. Christ.

Thats before you count the 21 pound on broadband and whatever Sky costs you. Work this out. Keeping yourself entertained while you're not actually earning money is costing you an awful lot.

Thanks for your reply. Don't know where you're getting the "spending 10 percent of your income on movies" thing from though. I make no apologies for spending money on 'entertaining' myself - I don't spend money in other areas, i.e I don't go out much, don't own a car, don't buy CD's etc etc etc. I also think you underestimate my willpower. My main point of getting the Barclaycard was that I could draw a line in terms of spending on the HSBC card, and I of course would pay off any debts fully with the Barclaycard within 56 days to get interest free. I wasn't asking for a lecture on my lifestyle, just some advice. Appreciate the reply though.

crube

Ian_Griffiths wrote:

Spending on 56 days interest free is better than spending on a big balance, indeed correct.

It just struck me that not spending at all on entertainment would fix the big balance problem as well.

Obviously you must live - but look at the total cost of this. Its huge when you consider the long term cost of the HSBC debt.

10% was a complete guess. It might be worth you actually working out though how much money you are spending on entertainment, and how much difference that spending would make to your debts if you channelled it in that direction. My understanding would be that it would shorten the lifespan quite considerably as well as reducing its cost by the same factor.

You need to spend more time in Debt-Free Wannabe forum, thats full of lifestyle decisions

I know I spend quite a lot on entertainment, but it makes me(and my wife and son) happy. Like I said, there's things I don't spend on such as a car, mortgage, nights out etc so I don't apologise for spending on entertainment. I also didn't say I was absoloutely desperate to get the HSBC card paid off - with the money my wife and I have coming in we manage to pay it off every month, but of course it'd be nice to make more of a regular dent in the balance. With the help of this site I have saved in lot's of areas, the credit card is the last area I am looking at really. I think I may apply for the barclycard, it's at least worth a shot.

Fedz

If you do get the Barclaycard are you going to use this card and pay the monthly balance in full or are you planning on balance transferring the 75% allowence to it from your HSBC card and are you going to cut-up the HSBC card and keep paying that off while you use the Barclaycard and maintain paying that off in full every month?

Important: If you are going to BT the 75% allowance then please do remember not to spend on the Barclaycard in any way, shape or form as this will sit behind your BT building up interest (at full rate) until the BT is paid in full.

Good luck and please keep us informed of the outcome of your Barclaycard application

Kind regards

crube

Fedz wrote:

If you do get the Barclaycard are you going to use this card and pay the monthly balance in full or are you planning on balance transferring the 75% allowence to it from your HSBC card and are you going to cut-up the HSBC card and keep paying that off while you use the Barclaycard and maintain paying that off in full every month?

Important: If you are going to BT the 75% allowance then please do remember not to spend on the Barclaycard in any way, shape or form as this will sit behind your BT building up interest (at full rate) until the BT is paid in full.

Good luck and please keep us informed of the outcome of your Barclaycard application

Kind regards

I'm gonna try and transfer the balance, hopefully I'll be succesful cos that'll be a big help. I'll keep you informed, many thanks. :beer: