Overdraft

ElmerFudd

Is it better to clear an overdraft first or a high interest credit card? Currently only paying £5 a month in fees on the overdraft and at least £150 of interest on the high interest credit card. Thing I want to know is - is having the overdraft impacting more negatively on my ability to get a 0% credit card to stooze to or is it my high level of debt (which is more than 80% of my yearly income).

surrey648

Hi Elma, pay off the high interest one first. Interest is dead money to you. Is your overdraft authorised?
Its far more likely that your CC company will put detrimental information to the likes of Equifax, than your bank (especially if your O/D is authorised... because you're not doing anyting "wrong").
If your O/D is being managed in such a way that the bank is happy, I would doubt that this would impact getting a 0%CC.
Have you applied and been refused?
Are there other factors - often if there are other reasons (previous owners/tennants at your property for example or not being on the electoral role...)?
I had massive debt, but had no problem getting credit... a friend of mine who'd never had a CC found it difficult to get one!
The problem is that the 0% companies can be a bit more fussy about who they accept, so their selection criteria is tight!
Good luck though!

ElmerFudd

Thanks for answering surrey648. Yep overdraft is authorised and I have never gone over. I haven't applied yet but since my actual debt level is so high I didn't want to proceed til it was down a little more. I have recently received an offer for 0% for 9 months from my old CC and may well take it. If I do it will cut my DFD by a month. However since they have done that I was thinking perhaps I could chance applying for a long 0% or lowish LOTB transfer somewhere. Has anyone had a problem with this?
I've also had an offer for a 10k loan from my bank, but the APR is 15.5% and it would work out that it would add a further year to my DFD, so I'm not going down that route.

triple_choc_chip

Hi ElmerFudd,

You're not in a position to stooze because the interest gained in a savings account would be negligible compared to the high interest you're paying on the c.c. If you qualify for a 0% card, use it to transfer some of the high interest debt onto it. Good luck.

ElmerFudd

Excellent triple choc chip. I'll try it over the weekend and let you all know how I got on. I'm just keen to be shot of this card early (they've wacked the interest rates up three times in the last 9 months, but since I wanted access to it I didn't decline and close the account). Wish me luck!