Maxed Out Credit Cards

loveandlight

I have a lot of money owing on several credit cards all of which appear to be maxed out apart from one. They look maxed out because the card companies kept increasing the interest rates and reducing my credit limits at the same time so it looks as if I've maxed them out when I haven't. I don't use any of them.

My credit file is otherwise squeaky clean. No defaults or missed payments etc.

Just wondering what you think my chances are of being able to switch some of these cards on to 0% interest or very low interest rates elsewhere?

Thanks.

stephane_2

That will all depend on your level of debt compare to your annual income and each lender will have their own lending criteria so you won't know if accepted until you apply....

loveandlight

My debt to income ratio is about 60 - 70%.

stephane_2

That will be considered as already very high for most lenders, you may get accepted but I would think that the limit given will be small

loveandlight

Thanks stephane. It's more like 60% but even a small limit on a low rate is a step in the right direction than being forced to pay out a very large interest balance every month. One of my cards that's on a very low balance (2.9%) will be paid off in the next 6months so I'm concentrating on that one at the moment and when that one drops off it should give some confidence to other card companies.

fozmcfc

It looks like you are in a no win situation at the moment.

The only thing you could try, is to contact the companies and ask for any special offers on transfer balances etc and/or if they would lower the APR on any of the accounts. That way you might be able to juggle them around to reduce overall APR. Sorry to say, but I must admit I don't really rate your chances as it is virtually unheard of.

Do watch out for any APR rises as well, as you would be better off rejecting them and having the card closed down and paying of the balance at its current APR.

Other than that have a go at the snowball calculator about in what order you should look to pay off your cards. See what it comes up with, it may be a long way off, but it can at least give a small chink of light at the end of the tunnel.

CLAPTON

loveandlight wrote: »

Thanks stephane. It's more like 60% but even a small limit on a low rate is a step in the right direction than being forced to pay out a very large interest balance every month. One of my cards that's on a very low balance (2.9%) will be paid off in the next 6months so I'm concentrating on that one at the moment and when that one drops off it should give some confidence to other card companies.

why ever are you concentrating on the old with the lowest APR?
you should be paying as much as possible on the one with the highest APR

MFWannabe

Hi
I think you need to give people on here more information so they can give you better advise.
How many cards? How much outstanding on each card and what are the apr's?
How much do you earn?
then we will be able to give you better, more accurate advise

Hope this helps

loveandlight

why ever are you concentrating on the old with the lowest APR?
you should be paying as much as possible on the one with the highest APR

Because I prefer to do it that way as that's the one where the interest rate is extremely low and so the debt is coming down in leaps and bounds every month. Whereas I won't even make a dent on the others in the next 6mths as they are all at 22.9%.

jonesMUFCforever

loveandlight wrote: »

Because I prefer to do it that way as that's the one where the interest rate is extremely low and so the debt is coming down in leaps and bounds every month. Whereas I won't even make a dent on the others in the next 6mths as they are all at 22.9%.

But what is the interest costs on the high ones compared with the lowest one???

Utter madness IMO.

fozmcfc

I can understand that way of thinking, but in the long run, you will 99.9% of the time end up paying more back. Sometimes it's a case of not letting our heart rule us.

The only way I could see it wouldn't be that case, would be if the 2.9% card has a much, much higher balance than one of your other cards, but that's where the snowball calculator comes into play.

If the snowball calculator tells you that paying off the 2.9% card last is the way forward, you need to tell your heart, sorry but my brain is right.