Do I save for fees or clear 3k debt?

djdymond

good afternoon everyone, hope your all well!

after a bit of advice really! wasnt sure which of the threads to put it under so apologies if its wrong!:o

BASICALLY i have a cc which has 3k on it. i want to buy my own place with other half in january. we need 4k for fees etc as were getting a 100 per cent mortgage. we already have 2k saved. the plan is to save 2k between now and january. my dads giving us 500 towards it next month so we are sure with some pulling of purse string we can do it.;)

what bothers me is this damn cc i want to clear though. at the moment the way i see it, is house prices are always on the up. we should buy asap really, as leaving it another year or so would see a rise in prices. any money which isnt being paid on bills etc is going into our "new home" savings account as i thought once weve moved somewhere in janury, i can then go to town clearing the card.

as the other half gets paid about 270 weekly, were putting at least 100 pounds into it so we can have this 4k by jan. after that, the 100 a week will then go to the cc.

do you think this is the best way to go about it? im 23, other half is 24. weve had family say "get on the ladder asap" so we can have a longer mortgage and pay it off while were both young etc.

3k is all (!!) i owe and am in the process of changing cc so that im not paying interest for a year so i can still clear some of the balance. at the moment interest and this payment protection thing im paying is totalling 80 quid. i was unaware of this as ive been paying off 100 for the last few month so obviously ill soon be getting no where! im certinaly NEVER getting another cc ever again, or start getting loans to pay other debts. ive seen what its done to people on here as well as my parents and dont want to go down that route. everytime i get some cash in i think well i need as much as poss for our fees etc furniture so really, every spare penny should be in there, but i feel guilty this cards not really going down! although im not spending any on it anymore! the interest seems to be doing that for me!!

all the while im throwing 650 a month at our landlord when i want a place!

so, the question is, do you think im doing it in the right order? or shall i be splitting this 100 a week 50 50 or what? i really wanna move in january!!!

thanks everyone!

Love

Helena
xxx

Numpty_2

Firstly get rid of the payment protection - from what I gather credit card ones are not worth it.

If your cards at 0% then pay the minimum and pay for the house - we too did the leap on the ladder thing, with lots of debts - we're glad we did. If we had waited a year it'd have cost us 10%+more for the house.

Other options - see if you can and dont mind buying a house in an "unpriviliged area" - these used to offer no stamp duty up to £150k (but dont know if thats changed since stamp duty threshold went up) - I think the land registry have details on this, and on the areas. Saves yourself £1,500 on stamp duty on a £150k property. Also dont forget that you only pay solicitors fees and stamp duty on completition, so you can split to make sure it's there at the end.

Furniture - ebay - so many people I know have spent next to nothing on immaculate furniture. Alternatively freecycle may have what you need

Toomuchdebt

Hmm I think if you can get it on a 0% interest card then go for the mortgage.TBH I wish my debt was yours instead of being 10 times more-lol.Defintely cancel the PPI!!

djdymond

thanks guys really appriciate the feedback and yes i will cancel it and change it over!

it all seems so duanting but ive just got to that point were i think, it really is dead money, renting!!

thanks again!

djdymond

just to let you know, im being sent the forms for a new card with no interest so i can swap it over.

in the meantime, i rang my cc company and asked them to cancel the payment protection which they did, after scaring me to death. he said "you do realise now that if you are sacked, made redundant etc, you are liable for the money" which i said yes and he asked me why i was cancelling it and i said ive never needed it and im saving money where ever i can to which he laughed and said "fair enough" as if i was crazy.

feel rather stupid now!!!

djdymond

sorry numpty,

whats freecycle?

Thanks

Helena

Numpty_2

http://www.freecycle.org/display.php?region=United%20Kingdom

If you have stuff you don't need anymore then you can advertise it on here - similarly people give away stuff for free. It's a swapping community

dumpy

Don't feel stupid about cancelling PPI there are loads and loads of small print that give the cc company an opportunity not to pay out. I always get offered it and say no, they then look at me as if I am stupid and give me the doom and gloom story.

I normally respond by saying "I have a short term contract and I KNOW that you will not pay me anything if I come to the end of this contract." They normally back off at this point.

They make a LOT of money from PPI which is why they don't want you to cancel. They make you sound like you are crazy becasue they are gutted that you've seen the light!

CLAPTON

have you worked out a budget for your living expenses after you buy the house? generally house are a real sink for money...furniture, redecoration, the odd things that dont work or are hanging off the wall? can you be sure that you can pay the CC debt off before the 0% runs out?
have the mortgage co agreed to give you a 100% and at what rate?