debt on card and bank

colinhotrodts

I currently have a balance of £15000 on my card MBNA. What is the best way to pay it off? I am in full time employment. Many thanks

zppp

Do an income and expenditure, from that you can work out how much surplus you have a month. Choose a payment that is affordable and call up the card company to change the repayment.

This would mean tht you would be clearing it faster than if you only made the minimum monthly repayment

colinhotrodts

Would it be better to take a loan and pay that. I can only afford about £225 a month

zppp

What are the repayments you are making at the moment? Also, how much interest are you paying on your card monthly?

pjread

fag packet calculation that might be a little out, but.... 225/15k = 1.5% per month MAX payment you say.

what are you currently paying? is that a minumum payment of only 1.5% - or is it more and you're behind on it? or is that 225 per month on top of whatever you're currently paying that you can afford?

colinhotrodts

This is the total I can pay per month. I was just wondering if a long term loan at a cheaper rate is better

zppp

If you can take out a loan over 7 years, then the the repayments are likely to be around that amount. may I suggest that you head over to the Debt Free Wannabee board, as they may be able to suggest alternatives that may be cheaper than taking out a 7 year loan.

The problem you may come up against is that even when you apply for lening of £15000 to pay off debt, the lender credit score assesses you as if it is additional credit, in case you don't get round to paying it off etc.

izools

Depends on the APR of your card, and the APR on a loan you could get.

If your credit score is great (which I doubt given you can only afford £225 PCM on a £15K debt) then you may be able to get a personal loan at a lower APR than your credit card.

What is your annual income vs total outstanding debt at the moment? Have you ever defaulted on any credit agreements or missed any payments? Have you applied for any credit in the last six months?