Advice needed please to get rid of overdraft

iscamaid

Hi

When I moved house a couple of years ago i found costs spiralled and I ended up using my overdraft to pay high bills. I went from a monthly overdraft of about £40 to £3000. This may sound pathetic but I have tried hard since then to clear it, but sods law every time I save a few hundred something in the house breaks and needs replacing. I also moved to a bigger house with higher mortgage that also needed basic work (broken doors, 40 year old boiler etc) to make it liveable. The debt is really getting to me now, and paying £40 a month interest is getting me annoyed with myself. I know I am in a much better postion than others, this is my only debt other than mortgage, but I want to clear it. I have checked everything on this site but am still confused what is the best way, credit card, loan... I can proabaly afford £100 - £150 per month to pay it off, want the shortest deal with least interest. Please can someone offer advice or know of the best deals available?

barbiedoll

If your credit rating is good, you should be able to apply for a 0% credit card. There's loads of info on the main MSE site about the best deals but you must be ruthless with yourself and make sure that you don't run up any other debt on it. Cut up the card if you must (keep the pieces in case you need to refer to the number later!)

You should probably open a basic bank account for your bills and other payments, if you don't need any more credit, don't take it. If you have a large mortgage, you need to make sure that you can pay that, you don't need high repayments on loans or credit cards. Set up a savings account for household expenses and repairs, don't use credit unless you absolutely have to.

When your 0% deal has run out, if you have been making payments on time, you will probably get another deal. You're absolutely right to act on this debt now, as many of us will testify, debt has a nasty way of snowballing and it is easy to get out of your depth. Good luck!

beanielou

You need a super balance transfer card.
This means you can transfer money into your bank account.
MBNA do them.

determined_new_ms

When the credit crunch hit I found I couldn't get 0% ccs any longer. I switched to a 0% od with the A&L (as long as you go into the black for a couple of days a month they will match your od) and then I used the tried and tested method of living well below my means and paying it off each month (have been paying between £450 & £600 each month) and over the year I've slayed it. No easy options if you can't get a 0% balance transfer I'm afraid x

Marisco

Why not go to the bank, explain the situation, ask them to freeze the a/c so no more interest goes on it, then come to an agreement re paying it back? I did that with my partners debt, and we are paying it off slowly. And just pay as much as you can comfortably afford, take a soa with you to prove how much is left for debt payments.

iscamaid

Many thanks to all the people who have posted replies. I would love to do the MBNA super balance transfer, but after reading the post I checked Martins details on this and I dont qualify as I have Virgin credit card (zero balance but still current). I am tempted by the idea of a mule card to get the zero balance, just need to be super organised. My other thought was the same as Marisco, go into Natwest, apologise and see what they can suggest. I know they will try to "sell" me a loan which may have a higher rate of interest than I could get elsewhere, but it would be a simple method.......With regards to getting a credit card with zero rate, I think I should be ok. I did the free 30 day Experian credit check a couple of weeks ago and it seemed alright. I had been a bit worried that being overdrawn for so long would count agianst me, even though it is within agreed overdraft levels.

beanielou

There is another SBT card.
Can any one else remember which one it is?

natsing

If you've got a current Virgin card with zero balance have a look at the online section, I have an MBNA card and was offered a 9 month 0% SBT as an existing customer and I didn't have a credit check done either, it could be the answer you are looking for.
Alternatively set up a new account somewhere else and get your pay, bills and DDs moved and pay off an amount every month to your OD as a standing order, this way you won't flag up to the bank that the account isn't used, in a asense treating it as a credit card or loan which has a fixed monthly payment. I did this with three accounts which had £2500 on them in total, they were gone in six months and our banks never queried them, this doesn't work if you have an account which requires a monthly figure to be deposited however.

MegandNicsmum

We're paying back our £2200 overdraft at £100 a month....paid £600 back so far and after our holiday we will ask them to increase the amount again....once a month the balance reduces itself by the £100 and that's it.....as simple as that?!?

Happytogetdebtfree

A and L do not give an overdraft unless you are in the black for 30 days that is what they told me when i moved for the 0% overdraft needless to say i havent got an overdraft with them because of that clause ! i was so mad so always read terms and conditions of any new bank app :O good luck and clearing the debt

Lemon_Tree

whilst you're trying to find a way to borrow to pay off your overdraft, have you thought about moving DD's/ SO's to later in the month so that you can reduce the time you spend near the maximum of your overdraft, i did this and it saved me about a tenner a month on an overdraft of £1650. the only way i eventually got rid of my overdraft was to reduce it everytime i finished a month with £50 less on the overdraft balance than the previous month. My bank allowed me to reduce it in £50 amounts and i knew if i didn't reduce it every month/ or whenever i didn't use the £50 i would spend the money again up to the limit. Another thing i did was to transfer some money into another account at the start of the month and if i hadn't touched it at the end of the month i would transfer it back and then reduce the limit once again.
As you can see the common theme i used was to reduce it each month if i was able to so i couldn't spend it again. when i first started clearing it, it would take me 3 months to reduce it by £50 nearer the end of it's life i was reducing the balance by £100 - £150 each month as i was getting more on top of the other things which were going out of the account so had more free.
The feeling of not being at the banks mercy if they decided to cancel my overdraft with no notice was wonderful and well worth the struggle to live within my means and get rid of the bloomin thing.
good luck