MBNA Problem

deth999

Hi guys,

I stupidly have run up a debt of about £10,000 with MBNA when I helped out my mates business which then went bust. I was on a promotional interest rate which was keeping the payments down whilst I tried to pay it off. Unfortunately, I lost my job and was out of work for around 3 months, during which I missed one payment and forfeited my promotional rate. They have now put my interest rate to 30.9% which means my minimum payment has gone up by around £200 per month. I called to explain my situation regarding my job and that I am now employed again and will do everything I can to pay off my debt. They have told me they are leaving me on the 30% interest rate and that I owe them £700.00 before they will discuss anything futhur with me. I know I will never get the promotional rate back, but i want to pay off my debt to the best of my ability. If the interest rate stays the same, no matter what I do I will never be able to clear the balance. What should I do? Do I try a payment plan with them to reduce the interest? I don't want to mess up my credit file too much. HELP!

deth999

forgot to add, MBNA are being completely unhelpful and have told me there is nothing they can do to help despite the fact that I don't want to renege on any debt.

YorkshireBoy

deth999 wrote: »

They have now put my interest rate to 30.9%...

I believe, since January this year(?), that you could opt to stay on the old rate (15.9%?) by agreeing to cut the card up and not use it again. That should be your next move, as it will halve your interest in one go.

All the above depends on "they have now" meaning very recently?

Moggles_2

They have told me they are leaving me on the 30% interest rate and that I owe them £700.00 before they will discuss anything further with me.

Sorry, I don't understand how missing a single payment leaves you with a bill of £700. MBNA's minimum monthly payments are the lowest in the UK.

Do I try a payment plan with them to reduce the interest? I don't want to mess up my credit file too much. HELP!

I would avoid this route, if possible. It will be marked as "arrangement to pay" on your credit file and that would affect your ability to get credit for 6 years.

TBH, it's in your interest to work out a budget in order to pay it off as quickly as possible, rather than rely on MBNA to impose a payment schedule.

To help you further, we would need to know which credit cards - besides MBNA - you have at the mo or have held recently.

YorkshireBoy

Moggles wrote: »

Sorry, I don't understand how missing a single payment leaves you with a bill of £700.

The 1% missed payment - £100

At least 3 months of interest at 15.9% APR - £123 x 3 = £369

Total £469

Sounds like it's been going on a little longer than 3 months...maybe 5 months?

taktikback

if the default was two months ago, the promo rate would have been removed from the beginning of the first statement period missed, and interest applied at 30.9%. That could be nearly 3 months interest by now - on £10k that's easily £700

..I feel sorry for you. MBNA swindled a similar amount out of me for a minor transgression. I wish more people would vote with their feet and leave this disreputable company...their offers are designer scams.

MBNA will screw you into the ground. Don't bother trying to negotiate with them

Perhaps a personal loan is the answer - 8% ish - pay MBNA off, cut the cards up, and don't forget to tell your friends to steer clear of them and their cover brands like virgin.

Debt_Free_Dreamer

I was late with a payment to Virgin and they ended my 0% rate. I wrote an begged for them to reinstate it and remove the interest they had already applied to my account.

The halved the interest and put me back on 0%.

A letter is often better than a phone call. Be nice (very nice) and see where asking might get you.

I fell foul yet again with Tesco when I forgot to pay on time and luckily they removed the late payment fee. Oddly they said the late payment did not affect my 0% rate. However, after pleading they did remove the charge.

Mental note to self. Must set up the Direct Debit as soon as I get a new card next time!!!

RoyalBlues

YorkshireBoy wrote: »

I believe, since January this year(?), that you could opt to stay on the old rate (15.9%?) by agreeing to cut the card up and not use it again. That should be your next move, as it will halve your interest in one go.

Hi, do you have any concrete info about this 15.9% rate. I'm in trouble at the moment with MBNA (I've put my situation in another thread) and I cut up my card many months ago but find out today that im now on a 34.9% interest rate!

Cheers!

deth999

taktikback wrote: »

if the default was two months ago, the promo rate would have been removed from the beginning of the first statement period missed, and interest applied at 30.9%. That could be nearly 3 months interest by now - on £10k that's easily £700

Spot on. I just don't know what to do. I don't want to enter into anything that will damage my credit for so long, and the worst of it is, I can actually afford to pay off £250 per month if they would just knock down the interest to a reasonable level. Does anyone have any advice, as I am not confident I will get a personal loan??

deth999

BTW- The interest is actually 34.9%.