Help! What to do with my credit card debt?

chris10131121

Have had a look and nothing seems to be wrong. Would the fact I have moved house a lot affect it?

nikki_angel

Have you always been on the electoral roll? Moving definitely does affect in my experience.

chris10131121

Yes I've always been on the electoral roll as far as I know. I'll check the council just to make sure in case the form got lost!

Virus_2

I'd transfer as much as you can from HSBC to Virgin as the interest will be cheaper, then concentrate all your overpayments to clear the remaining debt on the HSBC card. Not sure if that's the best advice, anyone else back me up/tell me I'm wrong?

Tixy

Regarding your credit rating -I think its probably based on your affordability.

You earn around £21k but have total credit accounts of £10,500 plus whatever the overdraft is. And you have debt of £5772 + overdraft + the laptop loan. If someone gave you more credit you could in theory spend the available credit of £4728 on your existing cards and max out any new debt, a lender would probably judge, quite rightly, that you would struggle to pay this back.

I know you would want to move the debt not rack up more but lenders will look at what the worse case position you could get yourself into when deciding whether you'll be able to meet repayments.

Tixy

Virus wrote: »

I'd transfer as much as you can from HSBC to Virgin as the interest will be cheaper, then concentrate all your overpayments to clear the remaining debt on the HSBC card. Not sure if that's the best advice, anyone else back me up/tell me I'm wrong?

Should be the right way forward Virus.
I think it will depend on the BT fee involved in moving the debt over. Usually I think you can only move over 90% of the total card limit so Chris you could probably only move £778 over, the fee for this might be around 3% (you need to check) so it would cost say £23 to move. So £778 will then be at 6% less, Depending on how long it takes you to clear the remainder of the HSBC card and the £778 from the transfer you will get that interest benefit for that amount of time. So to clear the £2050 on top of the minimums to virgin will probably take around 10months (based on your SOA). So £778 at 6% over 10months equals around around a £40 interest saving, compare to a cost of £23, so it looks like it is worth doing (although isn't going to save you massive figure).

Anyone who wants to look to see if my calcs look correct do feel free (the logic makes sense in my head!)

chris10131121

Thanks Tixy that makes sense!
Guess I have to focus on paying back the cards!

Is it really true that spending and repaying on the HSBC card could help the credit rating?

Welshdebtor

chris10131121 wrote: »

Is it really true that spending and repaying on the HSBC card could help the credit rating?

Yes if you pay the full amount off everytime, it's is a dangerous game, so only do it if you trust yourself not to overspend what you can afford

Tixy

chris10131121 wrote: »

Is it really true that spending and repaying on the HSBC card could help the credit rating?

Yes, but only after the card is cleared though, and actually won't make that much difference if you still have a 3 other credit accounts running within their terms (the overdraft, other card and laptop). However it is recommended once people are getting close to paying off their debts to keep an ongoing credit history and show you can handle credit responsibly.