In Debt, Some advice needed

timjones16

Hello there, I hope that you guys can help us.
We are after a bit of advice as we seem to be going around in circles, 1 day we think 1 solution is the best the next day we have changed our minds.
The situation is like this,
I have become nearly £3000 overdrawn on my bank account and we have approx. £2000 on credit cards 2 of which are on 0%, one ends soon and the other ends in Jan 07. Another of the cards is paid off each month and is usually about £500-£600 each month so that forms part of the £2000.

We would like to know just what the best direction to take is with all of this debt, is it more credit card tarting, is it a loan, do we tag it onto the mortgage or is there something that we are missing. Obviously we have looked at the web site and while it is great we keep thinking every new idea we see is the best.

Thanks in advance for any help you can give us
Cheers.

Thriftylady

I don't want this to sound blatantly obvious or a bit cheeky, but since you can pay off one of the credit cards in full each month, is there any chance that you could just not spend on it again ? That way you could throw that money at clearing the other one.....and at that stage when both are down to zero balance, you could close one account and keep the other one, using it and paying off the balance each month (as you have already shown yourself that you have the self discipline to do this).

CLAPTON

unfortunately the only real way of reducing debt is to increase your income or reduce your spending or both. obviously arranging debt to pay the least amount of interest is helpful but the key point is to address the reason you are in debt.

why dont you post a Statement of Affairs (SoA) here and maybe people here could help advice how to gain control of your spending.
see this link for more details of how to do this:

http://forums.moneysavingexpert.com/showthread.html?t=107280

Annie_Fanny

As mentioned before it is best to post up a Statement of Affairs. From this we can help you make savings to throw at these debts...

The people on this board will rarely advise on a consolidation loan or a remortgage to swallow your debts as it will more often then not end up costing you a whole lot more in the long run. I see the approach on the board as a kind of 'debt repayment purists'. We generally advocate a diy approach, i.e. understanding why you are overspending and making the necessary changes to your lifestyle in order to free up more money to throw at the debts, i.e. knocking the gym membership on the head, getting a part time job etc...

Your debts:

Overdraft: £3000
CC1: £1400 (am guessing this figure) 0%
CC2: £600 (am guessing this as well) 0%

What are the apr's on these debts, i.e. what does the 0% cc's apr revert to after the 0% period? Don't make the mistake of discounting the overdraft it is still a debt and the apr may well be pretty high.

Have you heard of the snowballing technique? It may well be that you are not 'attacking' your debts efficiently? The best thing to do is pay only minimum payments on the 0% credit cards and get the OD cut down. I am assuming that the overdraft is not at 0% ofcourse. Check out http://www.whatsthecost.co.uk/snowball.aspx for more information on snowballing.

Good luck!

Annie

david_hellier

Before you start switching money products you need to do an SOA and prioritise your debts. Run a budget first for a few weeks then start thinking about switching.
I recommend you stop using ccs and borrowing any more money.

timjones16

Thanks everyone for help offered, I tarted debts onto 0% cards, seriously put the brakes on spending (Really reduced spending on food changed some suppliers. All stuff that is so simple but you don't think of when in major panic mode!!!!)and am saving towards paying them off when the offers expire anything unpayed I will hopefully tart again until clear. Just got to stay clear of those gadget and electrical shops!!!!