Help - What do I do?

boxerlover_2

Hi, I'm a long time reader, first time poster.

I have seen that people on here give excellent advice and wondered if you could help me please.

I'm so worried about my debts and I'm struggling to sleep for the worry. I have debts of around 4,000 (credit card and store card) I was wondering if its a good idea to take a loan out to pay them off?

I am recently divorced and struggling financially, I never seem to have any money left at the end of the month and can't have any sort of life due to my financial situation.

My current repayments are around 100.00 per month and I've had alook at loans online and I could get a loan for 4,000 over 4 years for 84.00 per month.

I know my situation isn't as dire as some people on here but its really worrying me now.

Any advise would be greatfully received.

Thanks.

pepe2008

Make sure that you are confident of repaying it. have you looked at transferring the balance to a 0% deal with an alternative Credit Card ( Virgin e.g?) this would give you the chance to get the balance down for a year or so and then you can take out a smaller loan if you still need to.

If you go down this route MAKE SURE YOU DESTROY THE NEW CARD AS SOON AS YOU GET IT! That way you protect your Interest Free status and wont get tempted to spend more.

DONT get a Secured Loan!

Sit down and make out a proper budget ( templates available on www.nationaldebtline.co.uk ) and see if there are any areas where you can reduce spending/increase value.

boxerlover_2

pepe2008 wrote: »

Make sure that you are confident of repaying it. have you looked at transferring the balance to a 0% deal with an alternative Credit Card ( Virgin e.g?) this would give you the chance to get the balance down for a year or so and then you can take out a smaller loan if you still need to.

If you go down this route MAKE SURE YOU DESTROY THE NEW CARD AS SOON AS YOU GET IT! That way you protect your Interest Free status and wont get tempted to spend more.

DONT get a Secured Loan!

Sit down and make out a proper budget and see if there are any areas where you can reduce spending/increase value.

Thanks for the advice. I'm sure I could afford it as the loan payments would be less than what I'm paying at the moment.

I have a store card with Comet with a balance of around 800.00. The APR on this is shocking, but you can't pay the balance off with a CC, only a debit card, or this would be the first thing I would have done. I already have the Virgin CC with an outstanding debt of 3,000. This are my only 2 debts, but my income isn't very high and I want to find the best, cheapest way of paying them off.

redlady_1

Personally, I think this is a dangerous route to go down. I think there is a thread about repaying credit cards with loans. And is a saving of £14 per month going to allow you to have a life? When you say have a life what sort do you mean? Have you done a SOA? Can you get another job, increase your hours?

boxerlover_2

redlady_1 wrote: »

Personally, I think this is a dangerous route to go down. I think there is a thread about repaying credit cards with loans. And is a saving of £14 per month going to allow you to have a life? When you say have a life what sort do you mean? Have you done a SOA? Can you get another job, increase your hours?

Thanks for your advice. I'm really not sure what the best route is to paying off this money. The APR on my store card is 29% and I'm paying off about 40.00 per month. So its going to take me around 2 years to pay this off. The loan I have been looking at has a rate of 9.5% and I thought it would be easier to have all my debts together with one repayment.
I haven't done a SOA yet. I work full time and can't increase my hours, its also written into my contract that I can't be employed anywhere else!

mummy2mygirls

with the commet card - we had the same thing where they just charged me silly money on interest each mth - i knew i had the space on a lower cc so i spent on the cc and paid the money onto the commet card....got rid of the high interest but not the debt....might be worth it if ou can do that... It took me a few mths to cover the whole commet amount though and had to make sure i only spent on cc what was needed and put all the money towards the commet
HTH a little...

Im not sure the loan would be a good idea. It saves you £14 a mth but im sure if you did a soa then people on here would be able to help you save that - if not more on you mthly outgoings.

pepe2008

redlady_1 wrote: »

Personally, I think this is a dangerous route to go down. I think there is a thread about repaying credit cards with loans. And is a saving of £14 per month going to allow you to have a life? When you say have a life what sort do you mean? Have you done a SOA? Can you get another job, increase your hours?

It only works if you have discipline and can TRUTHFULLY afford the repayments.
The first issue to adress is 'are you living within your means?'

boxerlover_2

Ok, i'm going to do a SOA now. Thanks for all the advice so far.

planning_ahead_2

boxerlover wrote: »

Thanks for your advice. I'm really not sure what the best route is to paying off this money. The APR on my store card is 29% and I'm paying off about 40.00 per month. So its going to take me around 2 years to pay this off. The loan I have been looking at has a rate of 9.5% and I thought it would be easier to have all my debts together with one repayment.
I haven't done a SOA yet. I work full time and can't increase my hours, its also written into my contract that I can't be employed anywhere else!

I'd be very surprised if you employer could enforce this. Employers have no right to dictate what you do with your non-working time and provided you can demonstrate to your employer that a second job will not affect your work with them then they cannot force you not to work in a non-conflicting post.

Many contracts that state this, but what they actually mean is that you cannot work in a second job that conflicts in some way, eg commercial confidentiality or health and safety reasons. Might be worth approaching your HR dept and asking if you could take on a second job and what the limitations would be.

pepe2008

But there are responsibilities under the European Working Time Directive to take into account. Management get around it by claiming that they have to be flexible in their working hours, the rest of us ( try being a truck-driver!) have to follow the rules....or at least the Employer has to make employees aware of them and show that they are taking steps to ensure that the rules are adhered to.
Its another pile of cr*p that only the UK take any notice of!

boxerlover_2

Household Information
Number of adults in household........... 1
Number of children in household......... 0
Number of cars owned.................... 1
Monthly Income Details
Monthly income after tax................ 930
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 930

Monthly Expense Details
Mortgage................................ 280
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 89
Electricity............................. 20
Gas..................................... 20
Oil..................................... 0
Water rates............................. 15
Telephone (land line)................... 11
Mobile phone............................ 10
TV Licence.............................. 11
Satellite/Cable TV...................... 18
Internet Services....................... 5
Groceries etc. ......................... 100
Clothing................................ 0
Petrol/diesel........................... 40
Road tax................................ 10
Car Insurance........................... 20
Car maintenance (including MOT)......... 5
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 5
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 5
Haircuts................................ 10
Entertainment........................... 10
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 684

Assets
Cash.................................... 700
House value (Gross)..................... 90000
Shares and bonds........................ 0
Car(s).................................. 1000
Other assets............................ 700
Total Assets............................ 92400

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 60000....(280)......5.6
Total secured & HP debts...... 60000.....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Virgin Credit card.............3000......30........0
Comet Card.....................800.......40........29
Total unsecured debts..........3800......70........-

Monthly Budget Summary
Total monthly income.................... 930
Expenses (including HP & secured debts). 684
Available for debt repayments........... 246
Monthly UNsecured debt repayments....... 70
Amount left after debt repayments....... 176
Personal Balance Sheet Summary
Total assets (things you own)........... 92,400
Total HP & Secured debt................. -60,000
Total Unsecured debt.................... -3,800
Net Assets.............................. 28,600

Hi,

I hope I have done this correctly, I'm alittle surprised at the results as I never seem to have any money left!