Now what to do

lynseydee

We decided that as the time was ready for us to remortgage we would get a fixed rate interest only mortgage for 2 years, pay off as much of our debt as possible and then re-mortgage again in 2 years with a repayment mortgage. The plan was for me to clear my credit card, which I probably could do in 9 months and then start paying off my loan. We decided that as our re-mortgage would finish around the same time as our joint loan and the APR was manageable we would just let that one run its course. I have since been e-mailed by Cahoot to say that they are increasing the interest rate from the 19th December to 14.9% (what a great Christmas present). I have now told my husband that we are going to have to throw all spare money at that debt instead. My dilemma is do I just go ahead and do that (hopefully we will get that paid off in 13 months) then pay off my credit card, the APR is 9.9% which I have calculated can be paid off in about 9 months then pay off my Egg loan which is 7.7% or do we see if we can put the Cahoot loan either on a credit card or maybe another loan with Egg. My only doubt is that as we have just re-mortgaged our credit rating isn't going to be too good. I had planned that we could probably be debt free in just 3 years and now I just don't know when it will happen. Just when I thought we were getting ourselves sorted again this happens. Arrrrrggggggghhhhhhhhhh

tyllwyd

What a shame! Maybe if you posted APRs, total owing and for how long etc, people might be able to give you a few different points of view on the best way forward.

loftygirl

Hello, I have been lurking on this site for months, but your post made me register!

I got that email too from cahoot. If you go to abbey.co.uk there is an offer of 5.8% that you can switch to if you quote the code they gave you in the email. It is a fixed rate loan so you can't overpay like you can now, but it is a better rate.

I decided against it as I want to repay in under a year and they can't do that. I also calculated that it is still cheaper to stay with cahoot at the higher rate than to switch to a lower rate BT card by the time I had paid all the transfer fees etc. So check that out before you transfer in anger.

Good luck with it. I was cross too, they only sent us an email last week saying it was going up on 7th December to 9.7% because the first year discount rate was finished. I hadn't even realised I had a discount rate!

lynseydee

Hi loftygirl

I had that e-mail about the interest rate going up the first time but as it was still less than my Halifax card didn't worry about it too much. Don't want to do fixed rate as we like the flexibility of being able to throw more at the loan if we have it.

All amounts and APRs will follow in a minute.

lynseydee

Ok, here goes:

Provider Amount o/s Payment Interest rate Ending

Cahoot £4,846.05 £223.05 14.9% October 2008
Halifax £1,331.21 min 2% 9.9% never at minimum
(roughly £27.00)
Egg £5,692.88 £93.00 7.7% 1st June 2013

Hope someone can make sense of this. Look forward to some suggestions.

whatatwit

Usually it works out cheaper to repay the most on the one bearing the highest rate of interest and minimum payments on the lesser ones.

Have you had a play with the different options on the snowball calculator. there is a link floating around somewhere on here.

If you put in the debts and the basic info that you have shown above, and the minimum payments, it will calculate a debt free date.
If you juggle with the payment figures, it will show you how the date changes depending upon what you pay.

I will have a hunt for the link.

Here it is http://www.whatsthecost.com/snowball.aspx

lynseydee

Thanks whatatwit. I thought of doing that then started getting confused as the Cahoot loan comes out of our joint account and we both contribute money into that and then my credit card and loan come out of my bank account. Not very good with working out figures at the best of times without this added complication!!

CLAPTON

if the mortgage is your only recent credit search, i would suggest you try for either lower APR loan or a low LOB CC to transfer that Cahoot loan.


with your present loans/CC clearly best to pay as much as possible off the cahoot loan and just pay the minimum on the halifax.

lynseydee

We have just recently taken out finance on a mattress for the next 12 months. It is 0% so we didn't have a problem with putting it on finance. We had problems with putting it in hubby's name and when they tried on mine it did get referred to the credit company before they accepted. Would this have an impact? Also how would we go about putting the loan onto a credit card if we were able to get one?