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£5k cred card debt - need advice on what to do pls!!!!

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I need outside perspective on my current problem.

I have run up a £5k Barclaycard bill - £4.5k is old(ish) being paid back at £200 per month (£75 interest, therefore reducing balance by £125 per month approx). I have however maxed my card out at £5k after terrible money management over Christmas and into January.

My credit score is frankly dreadful (538 with experian) due to having a number of accounts open (2 loans.... 6 monthly payments and they are both done, 2 cred cards, one with egg with £300 and £5k with barc and an overdraft of £1600).

I earn decent money, £25k approx, my girlfriend and i want to buy a house at the end of the year and I need to try and sort out as much of this as possible.

Please can I have some advice on the best way to go about clearing my debts and quickly. I have reduced my spending to food, rent and other necessities. I feel as though I'm stuck with no options other than to pay them off bit by bit and use the new "spare" money to pay off the next one more quickly etc.... if I have any other options, please let me know.

Any help welcome!!
Thanks

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  • saskay
    saskay Posts: 53 Forumite
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    I need outside perspective on my current problem.

    I have run up a £5k Barclaycard bill - £4.5k is old(ish) being paid back at £200 per month (£75 interest, therefore reducing balance by £125 per month approx). I have however maxed my card out at £5k after terrible money management over Christmas and into January.

    My credit score is frankly dreadful (538 with experian) due to having a number of accounts open (2 loans.... 6 monthly payments and they are both done, 2 cred cards, one with egg with £300 and £5k with barc and an overdraft of £1600).

    I earn decent money, £25k approx, my girlfriend and i want to buy a house at the end of the year and I need to try and sort out as much of this as possible.

    Please can I have some advice on the best way to go about clearing my debts and quickly. I have reduced my spending to food, rent and other necessities. I feel as though I'm stuck with no options other than to pay them off bit by bit and use the new "spare" money to pay off the next one more quickly etc.... if I have any other options, please let me know.

    Any help welcome!!
    Thanks
    What is your credit limit on Egg card?
    What is the interest rate on Barclays, Egg &loans?
  • bouncydog1
    bouncydog1 Posts: 2,696 Forumite
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    Would also suggest that you post a full statement of affairs over on the debt free board - make sure you use the link at the top of the page as this makes it easier for people to read. Include all of the interest rates.

    The people on the Board are brilliant at picking over SOA's and will provide helpful advice as to where you can cut back to pay off your debts. It might mean that unless you can up your income quite drastically you will have to put off the house move, but far better to be in a sound financial position before you approach lenders - that way you get the benefit of the best rates instead of having to pay higher rates because of your exisiting financial commitments. Also reduces the chance of being refused.
  • redpete
    redpete Posts: 4,695 Forumite
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    Please can I have some advice on the best way to go about clearing my debts and quickly.

    Earn more, spend less, borrow at a lower rate from somewhere else and put all spare money towards paying off the debts, starting with the one charging the highest interest rate (look up 'snowballing'). No magic answer really.
    loose does not rhyme with choose but lose does and is the word you meant to write.
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