Paying over £500 per interest - help!

stevesmithanon

I am in a hole and need some help. Not sure if this is the right forum for advice, but I figured its all very closely related so here goes...!

My financial summary is as follows:

Card Balance Limit Interest
Lloyds 13274 15000 1.53
MBNA 0 1000 2.53
MBNA 6220 7000 2.53
Capital One 3048 5000 1.4
Egg 11147 13000 2.0
Barclays 554 900 1.02
Total 34243 41900

Currently, I must be paying over £500 per month in interest alone and this dire situation is not helping me! Is there some clever way that I can manipulate the above sum so that I can take advantage of lower interest rates on balance transfers?

Tried my best to format but it looks horrid. Sorry guys!

Thanks,

Steve

nomoneytoday

I would check your sums again. I make that nearly £45,000 in debt.

Unfortunately there is little room for maneavour to low rates, so it may be better to snowball, do some overtime and pay off the most expensive first. If another company will give you a card then BT the most expensive rates first

Good luck

Cash_Flow

stevesmithanon wrote: »

I am in a hole and need some help. Not sure if this is the right forum for advice, but I figured its all very closely related so here goes...!

My financial summary is as follows:

Card Balance Limit Interest
Lloyds 13274 15000 1.53
MBNA 8514 0 2.53
MBNA 8388 6220 2.53
Capital One 3048 5000 1.4
Egg 11147 13000 2.0
Barclays 554 900 1.02
Total 34243 41900

Currently, I must be paying over £500 per month in interest alone and this dire situation is not helping me! Is there some clever way that I can manipulate the above sum so that I can take advantage of lower interest rates on balance transfers?

Tried my best to format but it looks horrid. Sorry guys!

Thanks,

Steve

You need to start snowballing:

http://www.whatsthecost.com/snowball.aspx

Cash_Flow

stevesmithanon wrote: »

I am in a hole and need some help. Not sure if this is the right forum for advice, but I figured its all very closely related so here goes...!

My financial summary is as follows:

Card Balance Limit Interest
Lloyds 13274 15000 1.53
MBNA 8514 0 2.53
MBNA 8388 6220 2.53
Capital One 3048 5000 1.4
Egg 11147 13000 2.0
Barclays 554 900 1.02
Total 34243 41900

Currently, I must be paying over £500 per month in interest alone and this dire situation is not helping me! Is there some clever way that I can manipulate the above sum so that I can take advantage of lower interest rates on balance transfers?

Tried my best to format but it looks horrid. Sorry guys!

Thanks,

Steve

Total Debt £44.925;)

stevesmithanon

Strange. When I pasted it, it came out wrong so I have edited the above figures. The totals are correct now. Sorry.

I was wondering if I could do something like this...

1. Transfer a little from each card to a bank account, thus using up the spare credit.
2. Apply all this credit to one card.
3. Then transfer balances from other cards to that card.
4. Transfer from the new free card and so on.

What do you think?

Cash_Flow

stevesmithanon wrote: »

Strange. When I pasted it, it came out wrong so I have edited the above figures. The totals are correct now. Sorry.

I was wondering if I could do something like this...

1. Transfer a little from each card to a bank account, thus using up the spare credit.
2. Apply all this credit to one card.
3. Then transfer balances from other cards to that card.
4. Transfer from the new free card and so on.

What do you think?

How much spare cash do you have each month that could be use to attack these cards?

stevesmithanon

Expenses are currently exceeding income. But my business income varies. If I can get the interest rates down I will be much closer to matching expenses with income.

May I ask the reasoning behind the question?

TheEffect

I'd get a 45k loan and clear all credit cards.

stevesmithanon

Would it not be better to get a 10K loan and then do the whole zero rate balance transfer thing?

CannyJock

TheEffect wrote: »

I'd get a 45k loan and clear all credit cards.

Maximum unsecured loan is £ 25k unless that's changed recently. With that amount of credit card debt I wouldn't hold out much hope of a loan. Maybe once you've reduced the overall amount of debt a low APR loan might be an option.

Do the snowballing thing.

Using the lower APR card to help reduce the debt on the higher APR cards might be worth thinking about, but you'll pay a fee each time (typically 3%). Transferring it to a bank account will count as a cash withdrawal and you'll get hit with an even higher rate of interest on that amount.

CannyJock

Okay, couldn't help doing some calcs on this.

Assuming you can transfer up to 95% of your credit limit onto your card, if you take all of the cards up to their maximum and transfer this onto your highest APR card (MBNA @ 34.96% APR), you can shuffle £ 4,182 between the cards.

Assuming a 3% balance transfer fee, it'll cost you £ 125.46 in fees to do it.

I calculate next month's interest will be £ 631.72 as it stands. After doing the shuffle the interest would be £ 593.77.

So it'll take you about 4 months before the interest you've saved covers the BT fees for the shuffle.

It'll then mean that you have a mixture of "BT balance" and "purchase balance" on your card, and the allocation of payment rules means that they'll put your payments to the lowest interest balance first.