Two Student Overdrafts

Helena_B_2

Hi. I was wondering if anybody could help me. I have just left University and have 2 student overdrafts totaling nearly 3000.

Can anyone advise me the best way to pay these off? High interest on them starts soon!! I have been advised to maybe take out a loan and pay them off that way so i just have the one loan payment? Maybe interest free.

Im not sure, please help!!!

Lokolo

Depends on the rates to be honest.

Do you not get a period where the ODs are reduced over a number of years?

If you haven't got a job yet get one.

Banks are very harsh on grads who haven't got jobs (they take overdrafts away!!! left with charges x100 etc.)

agsnu

Who are they with? Natwest will let you take out a £2000 interest free repayment loan.

greyster

i had three student overdrafts totalling £6000 at 0%. I knew they would be expiring soon so I took out a 0% purchase credit card, and did all my spending on that, while pumping all my income into paying off the overdrafts. This meant after 12 months, the majority of debt had been paid off on my student overdrafts while a considerable sum had built up on my 0% credit card. However when the credit card 0% ended, i could transfer it to another 0% card by taking out a 0% balance transfer card. When I had paid off my student overdrafts, I slowly paid off my credit card.

It needs discipline but I think this could be an option for you. At the peak of my uni experience I was £22k in debt (£6k to banks), its all paid off now and I never paid a penny interest apart from my student loan.

Helena_B_2

Yeah One is with Natwest ans one is with RBS!! Thanks greyster that sounds like a good idea!!! Any other ideas?? Please help!!

Natti_A

They should drop down by 500 per year rather than interest starting straight away.

I graduated last summer, and my £2000 RBS 0% student overdraft dropped down to £1500 yesterday. So they shouldnt be charging you yet. The interest on them is not that high (9.9%APR i believe for RBS) in comparison to some credit cards, and it is only on a proportion of it. So my 0% overdraft is now £1500, but my actual overdraft is £2000 still, so i would only be charged that rate on up to £500. (Not that i would use it!)

0% deals can be hard to get, especially for a graduate with limited credit history and/or no job yet (sorry i know i am presuming some things - this may not be the case for you).

RBS also did a 0% loan to pay OD's off, as i got offered this last summer. Instead i kept my overdraft, as i like having a buffer. If you take the loan, you cannot have the overdraft.