Money to lower debt.

threlfaw

Good afternoon,

I am soon to receive a windfall of some £10,000 and as i have a lot of debt i want to clear some of it with all of the payment. My issue is that i am unsure of what to clear with the money.

Here are the list of debts i have and current monthly payments.

Natwest cc1 £5,774.46 £129.00 (interest free)
Nat West cc2 £3,653.72 £82.00 (minimum payment)
Barclaycard cc £1,773.55 £39.50 (minimum payment)
Virgin cc £1,878.04 £33.90 (minimum payment)
Halifax cc £5,689.72 £56.89 (minimum payment)
Natwest O/D £1,500.00 Charges of £30/month

Northern Rock Loan £17167 £260/mth

I have recently been unable to get anymore Credit cards.

Thanks in advance.

climbgirl

Pay off the ones with the highest interest charges first. Can you tell us what the interest rate is that you're paying on each card? Checl the terms and conditions on your loan too - you may not be allowed to make overpayments without penalties so you might have to forget that one and concentrate on the credit cards.

sofababe

As none of the debts are defaulted (I assume?) you would be unlikely to get any offer below 95% accepted so I'd suggest you start with the one that has the highest APR and work downwards, thereby saving more money over time.

Tixy

Paying off the ones with the highest APR is usually the best starting point. But you might also want to consider which cards might give you new 0% deals if you clear them, which depending on your credit limits might enable you to move more of your debt on to 0% or perhaps low life of balance deals.

ixia

Pay off the ones with the highest interest and perhaps your overdraft and then you wont have to worry about the monthly charges.

Good Luck.

MFWannabe

threlfaw wrote: »

Good afternoon,

I am soon to receive a windfall of some £10,000 and as i have a lot of debt i want to clear some of it with all of the payment. My issue is that i am unsure of what to clear with the money.

Here are the list of debts i have and current monthly payments.

Natwest cc1 £5,774.46 £129.00 (interest free)
Nat West cc2 £3,653.72 £82.00 (minimum payment) - this one and cut up card and close account
Barclaycard cc £1,773.55 £39.50 (minimum payment) - This one and cut up card and close account
Virgin cc £1,878.04 £33.90 (minimum payment) - this one as Virgin usually have good deals and may offer you a 0% offer to move some of the remaining balances on other cards to them
Halifax cc £5,689.72 £56.89 (minimum payment) - Pay the amount you have left (approx £1200) off this one to reduce the amount outstanding; hopefully within a few months virgin will offer you a 0% deal to transfer the remaining amount left on this card to theirs. If they do and you manage to clear this one then once again cut up this card and close the account.
Natwest O/D £1,500.00 Charges of £30/month - This so you are not always in your overdraft

Northern Rock Loan £17167 £260/mth

I have recently been unable to get anymore Credit cards.

Thanks in advance.

Hi
I've made some suggestions above. This is what i would do and then you have managed to close a lot of the cc accounts. This is based on the information given and guessing that these are the high interest cards.

threlfaw

Thanks for all your replies.
Here are the interest rates on the cards i mentioned above.

Natwest cc1 0%
Nat West cc2 1.385% Monthly Rate
Barclaycard cc 1.167% Monthly Rate
Virgin cc 1.4352% Monthly Rate
Halifax cc 21.95% APR

Tixy

Well I would clear halifax & virgin to start. Then I'd clear your overdraft and remove the overdraft (or reduce it to £200 or something).

Then with what remains put it towards the Natwest2 card.
I'd also close the halifax card at that point.
Then after virgin statements with no balance on them ring up and ask what balance transfer deals they have. If they have a good deal consider BTing the rest of your natwest2 balance and your barclaycard (credit limit permitting).