paying off cards has got me befuddled

puggyone

Hi Everyone,

My first post here although i have been reading and lurking for a while. I am determined to try and clear my credit card debts but Maths has never been my strong point and i am getting a bit confused about the best way to to this:( i have read the article about "snowballing" which seems very sensible but is it right for my situation i wonder.

Right - I have a £9000 debt on a halifax card, at 14.9%, min payment is approx £120 per month

I have a £3,500 debt on an M&S account, has been on zero interest but this is about to run out and rate will then be same as Halifax card, min payment is approx £80 but this may change when rate kicks in.

I don't know if i have done the right thing but I have been accepted for a HSBC card (thought that getting a balance transfer with a lesser rate might help) This card will have a £2750 limit with 0% for 16 months.

I can afford to pay in the region of £500 per month off the debts (hopefully more).

I have stopped using the cards and have started to save an affordable amount to cover some of the things that I used the cards for in the first place.

Should i use the new card do you think? I can't help thinking that if i transfer debt onto it I won't have paid off the other debts by the time the interest free period is up. I suppose the idea is to freeze interest for a while but I feel like I'm just getting another debt and minimum payment to make each month.

I have a headache trying to work out all the interest etc, any opinions would be much appreciated, wish i had concentrated more in maths:o

thanks,
catherine

[Deleted User]

You should BT as much as you can (probably from the Halifax card) to the HSBC card.

Then pay min payment to HSBC for now and as much as you can on the other two. While they're the same rate, it doesn't matter which you prioritise, but keep an eye out for rate increases. If either goes up, that's the one you pay the most on, with minimum payment on the other.

If one of them raise their rates, then BT as much as you can to the other. This should be fee free and will keep as much as you can on 14.9%.

When your HSBC rate is nearing the end, you will want to close down one of the other cards (hopefully one will be paid off) if you need to look for another 0% deal.

puggyone

Deleted_User wrote: »

You should BT as much as you can (probably from the Halifax card) to the HSBC card.

Then pay min payment to HSBC for now and as much as you can on the other two. While they're the same rate, it doesn't matter which you prioritise, but keep an eye out for rate increases. If either goes up, that's the one you pay the most on, with minimum payment on the other.

If one of them raise their rates, then BT as much as you can to the other. This should be fee free and will keep as much as you can on 14.9%.

When your HSBC rate is nearing the end, you will want to close down one of the other cards (hopefully one will be paid off) if you need to look for another 0% deal.

Thanks so much for your reply...becoming clearer already

Hax

If they try to increase your rates (excluding when a promotional rate ends), you can reject the rate increases within 30 (or maybe 60 now) days. At that point, the account is closed to new transactions and you have to continue paying the balance off at the existing rate.