Help Me. I Have Sinned!!!

Foxy1075

Hi. I'm new to Money Saving and want to sort out my credit card debt. I have the following cards:

A Barclaycard with a balance of £3500 and a credit limit of £3600.
A Capital One card with a balance of £631 and a credit limit of £1600.
A Bank Of Scotland Card with a balance of £4100 and a credit limit of £4250.
A M&S Money card with a balance of £6000 and a credit limit of £8000.
A Virgin (MBNA) card with a balance of £4950 and a credit limit of £5000.

I no longer use any of these cards and cut them up six months ago.

I can afford to make the minimum payments on each of these cards every month (approx £350 in total), and every so often I have lump sums come through that I can use to pay more off if needed.

None of the cards now have special rate APR deals on them and are charged on the standard terms.

I would like to apply for a 0% card and become a rate tart but am worried that my credit history might count against me.

I have just had my equifax credit file through today, and although there's no horror information on there it does point out that with 3 of my cards I have been 1 or 2 months in arrears at some point in the past 12 months, though the others have an impeccable payment history, this is because it's only recently that I've set up DD on all accounts, and in the past forgot to pay.

I want to apply to one of the best 0% cards (the one's that don't charge a handling fee) for balance transfers but am nervous about doing so as there have been 4 searches performed on me in the past six months, for mobile phone contracts.

Does anyone know if this history will count against me, and if so does anyone know of a lender that will almost definitely accept me as they have more lenient lending criteria?

Thanks.

Foxy.

steve237

Hi Foxy,

I'm no expert on this but I would think for £19k of debt, a beter route would be through one of these debt consolidation firms rather than try to get 0% credit cards with £19k with of credit to do a transfer to - could prove difficult!

I think you should also post a topic on the Debt Wannabe board too as I think you might find some people with more experience in getting rid of larger debt through different means than keeping it on credit cards.

Just my two penneth, good luck with sorting it out!

MSE_Martin

Please read the Credit Card Shuffle Article, that in combination with one new card (see best balance transfers article) if you get it - can massively reduce your interest. All these articles are linked to at the top of the page.

Even if you cant get a new card - by using the shuffle correctly, you have the right cards to substantially reduce your interest. (Sound like doing the budget plan would also be a good move too)

martin

fatbelly

steve237 wrote:

I'm no expert on this but I would think for £19k of debt, a beter route would be through one of these debt consolidation firms rather than try to get 0% credit cards with £19k with of credit to do a transfer to - could prove difficult!!

Be careful. Debt consolidation is the domain of Carol Vordemann and other sharks.

Or did you mean fee-free debt management firms - like Payplan or CCCS?

steve237 wrote:

I think you should also post a topic on the Debt Wannabe board too as I think you might find some people with more experience in getting rid of larger debt through different means than keeping it on credit cards.

Ok, Steve, that's good advice. But 0% deals could still be (part of) the answer for the OP.

Foxy1075

Thanks Martin, I have applied and been accepted for an HSBC Credit card with the 0% for 6 months offer, and no balance transfer fee.

Only problem is I have a credit limit of just £2750 to start with, which helps but doesn't solve the problem.

I also tried the Shuffle Step 1 by asking existing companies to reduce the rate, of the five companies I have two agreed, Virgin (MBNA) reduced my rate from 22.9% APR to 14.9% APR and Barclaycard from 19.9% to 12.9% APR, the other three refused.

Dilemna I've now got is that as I've been accepted for one, should I try for another, bearing in mind it will now be five credit searches in 1 year (after my acceptance today) or should I just carry on with the shuffle steps 2, 3 and 4, will I actually have anything to lose in applying?

The only problem with doing steps 2, 3 and 4 is that I don't really understand them, hopefully that doesn't make me thick in your eyes.

Seeing as you know my balances and credit limits I've already posted can you actually advise me what to do in my personal circumstances please?

After reading the shuffle steps I have since realised I need to include my personal overdraft as well, that's with Barclays £2100, the first £250 of which is interest free, and the remaining monies at 9.9% APR.

In order to have this rate I have an account called Additions Plus for which I pay £12 per month.

Anything you can advise to help me out of this stupid situation (for which I have only myself to blame) I would be most appreciative of.

Thanks.

Foxy.

PoorDave

You are doing the right thing getting the rates reduced, and should now concentrate any extra payments you can make onto the worst rated debts.

I would suggest not applying for more cards right now, but that's just my opinion.

You will not solve the problem instantly. Sorry. You have to be patient.

As Martin says, a monthly budget plan would help you to see where you can save money to help pay these off.

The_Boss

Only problem is that £19k of debt isnt going to look attractive and also lenders will see you maxed out and fear the worst in lending you more money.

I would suggest applying for a low rate loan through your bank, paying the cards (or most) off and then closing down some of them. Tell the bank the reason for the loan is debt consolidation and they will be more sympathetic. There are some good offers out there, ranging from around 6.9% to 8.9%. That might be a better idea as I think any credit card issuer will run away once they see how much you owe and how close to the limits you are.

steve237

fatbelly wrote:

Be careful. Debt consolidation is the domain of Carol Vordemann and other sharks.

Or did you mean fee-free debt management firms - like Payplan or CCCS?



Ok, Steve, that's good advice. But 0% deals could still be (part of) the answer for the OP.

Yes, that's what I'm talking about. I detest these debt sharks like the Vordermann advert types. I knew there were good options out there worth looking for as a friend of mine had it all sorted out for him many years ago when he had high debts. They sorted everything out for him at a very low interest rate.

Bothered!

Foxy hi! you might want to post on the DEBT FREE WANABEE board as there are lots of people over there that are in similar situ as you and they can help with your Statement of Affairs to help you find ways to cut back.

regards and good luck x