Need to focus ........DEBT........Any help welcome?

gemmylouise

Hi

My house situation is a nightmare to be honest. My house is in the wrong area so I couldn't live in it! The mortgage is interest only so the capital is only because the property has increased in value.

With houses being so difficult to sell I chose to rent it out. This is extra income however I then rent in my new location for 585! I know that is throwing money away, I can't buy anywhere else here without selling the other property.

Its a difficult situation because if I put my property up for sale I will lose my rental income, and I honestly dont think it would sell as others are taking forever in the climate.

I thought I would pay off my credit cards, then change my mortgage over to repayment.

Hmmmmmmmmmmmmmm so much to think about! Confused!

Thanks

[Deleted User]

gemmylouise wrote: »

Hi

Thanks for your comments. Heres a few points you raised.

I own a property that is rented out. The rent that comes in is my other income 347.60. I can't increase my salary as I'm too tired to work any more hours, I will use my weekend to concentrate on ebay though.

My mobile phone is on contract so i am stuck with this.

I use my car very infrequently as I can walk to work although to not have it would be a complete pain so if I can manage my debt I would prefer to keep it. I've lost a lot of money on it now so could be more expensive in the long run to buy another car.

My Tesco card is 0% for another 3 months. My Virgin Card has just ran out of the 0%, the interest was 60 a month but I just transferred the 3000 over to Halifax on 0% for 15 months so I guess I need to clear the Virgin first.

I appreciate I'm not in as much debt as others, but 7,000 on cards seems very scary to me especially as house prices are falling!

Thanks for your help.

Hi,

You are right to concentrate all your overpayments on the Virgin card at the moment, because this is the only one that you are currently paying interest on.

In 3 months time though, when tesco start charging it would be a good idea to revisit your plan.

First off, before the tesco card runs out of 0%, see if you can transfer all/any of the balance to 0%, or even a low life APR.

If neither of these are an option, then in three months time compare the APR of both Tesco and Virgin (then the only two that will be charging you interest), Over pay as much as you can on the one charging the highest interest, and stick to minimum payments on the other. When the one with the higher interest is gone, then move on to the other. All the time focusing your overpayments towards the debt that's costing you the most.

HTH

D9