Decent (?!) Debt consolidation companies

LolaB2010

Hi,

I'm a new user to this forum. I am 25 and managed to accumulate £12000.00 of credit card debt... not good! I have been maxed out on most of these cards (and gone over their limits several times in the last 6 months) due to some expensive personal issues (broke up with partner etc)

Anyway, as a result of my poor management of my cards over the past 6 months i now have a pretty rubbish credit score. I have 5 credit cards and desperately want to get all my debt in one place and pay it off over 5 or 6 years.

My bank wont give me a loan due to the credit rating (although I could provide proof of earnings / ability to pay the loan) and I can easily meet repayments of up to £350.00 a month.

Has anyone had a good experience with a consolidation loan company? And do they give out loans to people with bad credit? Any opinions / recommendations would be great.

Thanks
Lola

LolaB2010

p.s also, how long does it take to improve your credit rating... would I be better off making sure all repayments on my cards are met properly for 6 months and then trying again with a high street lender?

gonzo127

basically stay away from consolidation.

speak to one of the debt charities ie CCCS or payplan or CAB these will hopefully get you on a DMP (debt management program) which usualy includes a freeze on interest and charges and a set amount you pay each month with they dish out to your creidtors

since your credit history is already shot this will do it no more harm and will likely mean it takes you less time to get your debts paid off, however if you can get on a DMP with on eof the charities you can sort out a self managed one

RAS

Hi

Do an SOA http://www.makesenseofcards.com/soacalc.html

And we may be able to help you sort your debts out more effectively.

Tixy

If you have a bad credit rating and your own bank have turned you down you are unlikely to get any consolidation without a hideous interest rate (quite possibly much higher than some or all of your credit card debts).

Rather than consolidating (which can cost more and doesn't address the route cause of spending more than you earn) if you can meet your monthly minimum payments you would be better trying to pay more to your exisiting debts (by reducing outgoings or increasing your income).

If you cannot meet the minimum payments even with cutbacks then as others have said a DMP may be an option for you.

First step, as RAS says, is to write out a detailed statement of affairs and post on here, that way you and we can see exactly what your position is and the best way to move forward from here.

Welcome to DFW.

LolaB2010

Ok thanks for the advice guys. I'm at work at the mo' but basically this is my monthly expenditure / income:

Pay - After tax: £1450.00

Outgoings:

Rent: £400.00 (non negot')
Phone: £50.00 per month
Credit card repayments: £500.00 per month
Car Insurance / utilities: £100.00
Petrol: £120.00 per month
So I am normally left with £300.00 per month which I can just about manage on

So there's not alot of room for me to trim down my expenditure....

I really don't want to have to do a DPM as I believe this stays on your credit history for 6 years....? I am hoping to manage this myself and improve my credit score etc alot sooner than that... perhaps I am being a tad unrealistic?

I owe £12500.00 across 5 cards (one of which only has a small balance of £250.00) and I have written today to my creditors asking for an interest free period of 6 months. I pay at least £100.00 per month to 4 of the cards but due to high interest I end up paying half of this amount back to them each month.

Thanks for your advice, much appreciated

gonzo127

well the reason to suggest a DMP is because the way it reads so far
"I have been maxed out on most of these cards (and gone over their limits several times in the last 6 months)"
this probably means you already have the marks on your credit history which will stay with you for 6 years anyway so going down a DMP route will make very little difference

but anyway when you get home do as Tixy has said and write a detailed SOA in the link provided above by RAS, this allows you to mark down all expenditure, some of which you have missed out of your basic one above, such as hair cuts, car maintenance, tv license ... you get the idea

once we have those details we should be able to suggest other possible 'cuts' to allow you to free up some money to help you along