debt help and advice please

lcgoodac

I am 24 and have just realised how much debt I am in.

personal loan £3444

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pay £130 a month
credit card £1158

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pay about £50 a month
credit card £1250

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pay about £50 a month
car £203.21 a month
petrol £200 a month
rent £100 a month
phone bill £45 a month
graduate overdraft £2000

I earn about 900 a month after tax

I was wondering if I could get a better rate on my loan and what would I need to do? In 12 months my boyfriend and I are looking at getting a mortgage but obviously would like to reduce my debt as much as possible

Any help would be appreciated

thanks

Lucy

Tixy

Hi Lucy

What APR are you currently paying on your loan?
What is the total of all your debts? including the overdraft and car etc?
I expect you would struggle to get another loan to move that one to as the banks will probably consider you would struggle to afford a new loan on top of your existing commitments (which is how they will view it).

It would be worth finding out all your APRs and then having a look at the snowball calculator to see what order to pay off your debts to pay the least amount of interest.

Might also be worth doing a statement of affairs to see if there are any areas of expenditure you can reduce so you can pay more off your debts. From the looks of what you have entered above and after taking into account costs you have missed out (car insurance, road tax, servicing, haircuts, clothes, presents, entertainment etc) I would imagine you probably are spending at least £900 a month?

bargainbetty

Hi Lucy,

Welcome to the boards!

You are spending more than half your income servicing your debts - very few lenders are going to touch you for more credit at this point! That said, it might be worth calling your current credit card companies and asking them about better balance transfer cards etc, so seeing if you can get one.

Do you have any money left at the end of the month? Are you still spending on the cards? If you do, then going for a consolidation loan is pointless, because you will just run the cards back up again. (I'm not judging, I did it twice).

Do a proper SOA, start keeping a spending diary to see where the pennies go. Cut up your cards and live without them. You may want to think about getting a second job to bring down your debts, because with that level of debt and your salary, a mortgage is going to be hard to get too!

Good luck!

bargainbetty

You beat me to it, Tixy!

lcgoodac

I am paying interet on one credit card and the personal loan (19.5%) the other credit card is 0%

[Deleted User]

If you fill in a statement of affairs it will be easier for people to comment.

lcgoodac

one of my credit cards has a limit of 5500 and i owe 1150 on this card. should I decrease the limit and how would this affect my credit rating which is currently 948 on credit expert and puts me in the good category.

thanks

lucy

Nottoobadyet

Do you and your boyfriend have a deposit saved for a house? If so, you should use it to pay off your debts and push off buying for a bit.

If you dont have a deposit and you are spending nearly half your income on (minimum?) repayments, I doubt you'll be able to get a mortgage. How will you cope if your mortgage repayments + utilities + food are higher than your £100 a month rent, which they almost certainly will be?

MFWannabe

Do have any spare credit avaialble on the 0% card that you could move the other credit card debt over to?

lcgoodac

I have £20,000 for a house deposit but this was left to me and don't want to touch it.

My credit card has gone over the 3 month period in which balance transfers can be made to allow me to have the 0% deal

MFWannabe

It might be worth ringing them though to see if they would offer it?