A little help re my credit cards

Needananswer_2

Haven't posted often so hope someone can help. I was made redundant in March last year. I managed to keep all my payments up through savings and my husband's help until a few months ago. I then got behind with 3 credit card's. I contacted each of the companies to advise of my situation and they allowed me (through a debt counselling service) to reduce my payments to a minimal £2 amount with frozen interest. I now have managed to get a job but at a substantially reduced salary. My problem is affording the payments if they were to go back up. I wanted to ask if anyone out there had came to an agreement with cc companies to pay a higher but affordable amount to run the debt down (cards cut up) and how it affected your credit rating. Really concerned as to how it will affect my husband.

Tixy

You will probably already have had default notices and defaults registered on your credit file as a result of making the £2 payments. Have you looked at your credit files to see if you have?

If you can now afford more but not the full amount then you should be able to offer reduced payments that you can afford - they may keep interest frozen - it depends on your individual case.
If you don't already have a default registered for the debts then continuing to make lower than the original contracted payments means they will almost certainly issue one.
A default stays on file for 6years and seriously affects your chances of getting mainstream credit for those 6years.

If you are financially associated with husband (joint loans, mortgage, overdraft) then it will also impact on his ability to get credit.

Needananswer_2

Hi, I have gone into my credit file and have an AP (arranged payment) and missed payments against the other 2. I want to pay down the cards with as much as I can afford but it will at this stage not be the cards minimum payment. Even though all my other payments are up to date I take it does not help?

mymoney12

hi , i would ring your credit card companys up and offer more than 2 pounds and explain the situation. they might freeze the intrest for abit. ten pounds or what ever you can afford is better than two. and it shows your trying to clear the debts.

Tixy

I think if you continue to pay less than the minimum they will all eventually register a default or a arrangement to pay marker on your credit file and this will affect your ability to get credit.

But notwithstanding the effect on your credit file they are likely to be willing to accept your offer if you produce an income & expenditue/ statement of affairs to show what you are offering is all you can afford. Make sure you treat them all equally by working out how much you can afford in total and then splitting in pro-rata between them based on the outstanding balances. If you are not sure you could always seek some further advice from whichever debt advice charity you spoke to last time (I assume it was one of the charities?).

knightstyle

I think there is a risk of the card companies reinstating the interest if you get in touch with them and increase the payments. How about putting the money into a saving account and paying of each card in a lump sum? Would take a while but that is what I did a while ago, the 0% deal was done by CAB with all the debtors except one who refused it, they never got paid, but all the 0% ones I paid over a period of 5 years. Now, over 10 years later I have an excellent credit rating even though I earn considerably less than when I ran up the debts.