Nearly there but not yet.Please help

xrflyby

Hello I was wondering if anyone can help me out.After several years now of not being able to get credit because if several reasons bad payer ignorance and the worst gambling i have nearly sorted my act out.I have now no debt as such apart from 500 pounds owed to halifax for a overdraft which im paying off very soon and a Very account which is all up to date.I have no longer any CCJS on my credit file but do have a couple of financial companies on there who i no longer owe any money too but some say satisfied and some say arrangement agreed(i think thats what they say)So in total i have personal debt of £1300 and earn £50k a year.I have had the same job for over 20 yrs and moved in with my girlfriend 3yrs ago and are registered on the national register at this address and rent and council tax are in both names.

With me not being able to get any credit we have used my g/fs credit cards uptp 18k.We are looking at getting a loan to pay the credit cards off but are frightened to apply in case i/we get turned down.My g/f has no history of debt or in any trouble and earns £5k a year.We have a joint bank account which is in credit and never been overdrawn.Do you think i shoukd apply now for a loan or do i need to do some more cleaning up before doing so.Like i say i am afraid to apply in case i get turned down which ive read will go against me.We are also hoping to get a morgage before it is too late.
Thank you for listening and any advice will grateful.

Verbatim

If you have a joint bank account I believe that means that your credit scores will be linked so that may bring down her ability to get credit. If you can get whatever poor history you have on your credit history removed now then do so before applying for any credit.

BUT it is not a good idea to get more debt to pay off existing debt. Why have the cards been run up and if you got a loan what would stop them being run up again? Perhaps getting a 0% card to transfer the balances, or as much as possible and a concerted attempt to pay them down would be better.

ellesbellesxxx

If you want to get a mortgage, I wouldn't apply for ANY more credit... you will see on here that consolidation loans are RARELY a good thing. You are best off working out where you can save money to throw at the debt...
The more you apply for credit before applying for a mortgage, the more likely they will reject you.
Why don't you post your SOA up here so we can advise you where to make cut backs? You need to cut up those cards now too.

xrflyby

Cheers for the info.The cards have already been cut up and will NOT be used again i just thought this would be a quicker way of paying the credit cards off.I roughly pay £600 pound off a month and could afford more.I just thought a loan would apply less interest over the years and repay quicker than credit cards.The credit cards are all up to date and have never fallen behind.Keep the advice coming.Thanks

savingholmes

Hi xr

I agree with other posters - the first question is what rate of interest are you and your girlfriend paying now - and what is the best possible interest rate you can get at the moment. That would potentially answer the question of whether staying with credit cards or moving to a loan is the answer

We have paid off around your level of debt since we joined the site about 2.5 years ago. We used to go for quick fix solutions - using inheritance, redundancy lump sums, house sale etc to pay off debt but found ourselves back in debt. Now we are in the proverbial slow lane but have learned our lesson and hopefully good habits that will stick with us for life.

If you are prepared to give the slow and steady approach a try - perhaps start with posting a statement of affairs and have a good hard look at where you spend your money now, and what sacrifices or changes you could make to maximise your debt repayment. You may be able to ring up some of your existing card lenders (or get your girlfriend to) to find out what is the best apr they would give you on a transfer and then take action accordingly.

Also try reading a few people's diaries to see how they do it. Most of us on here have learned so much from each other - and both supported and been supported by other users of the forum

Good luck. It really is possible to crack this....

xrflyby

Thanks people for all the replies.I am going to dig out all the interest rates and put up a statement of affairs but in the mean time im getting a tad confused as to why you dont think a loan at say £600 a month for 36 months equals 21600k and would pay off the debt alot quicker than paying the credit cards off at the same rate of £600 a month?I am now in a comfortable position and do not intend to get in anymore debt.I have gone through the long slog with a bad credit score to get ino this position so dont mind going the full journey.All advice is grateful Cheers.

Clarie_2

Hi xrflyby!
Basically, 9 out of 10 people who get a loan to consolidate credit card debt end up with more credit card debt (include us in that one!)
Which doesn't mean to say you aren't going to be the 1 who makes it of course! If you have cut up the cards and you don't need them at all for living, then it comes down to interest rates (you can often balance transfer to get lower rates than a loan) and flexibility - most loans don't allow you to over pay or pay off early.
But do the maths, and see which option is best for you.

Clarie