Would you u, or wouldnt you?

canidothis

If you were desperately trying to get rid of debt and felt you didnt want cc any more would you cancel a lloyds cc that was about to go up to 24.9% from 19.9% with only an available balance of £324???

before you all shout yes yes yes, remember the early lbm days when your back felt up against the wall, there was no overdraft limit left and the only available balance was £324.

These are such early days - it is the fine line between sussing out the money for 6 months car tax and thinking that cc is the only way to go.

So what do I do? cancel and have no credit at all OR continue and pay a ridulous about of % just to have a safety net of £324 (which..when you havent had time to put into a slush fund seems a fortune)

Help please xx

SCO

Can you not apply for a new card to BT the balance over to? then keep that one for emergency. always good to have more than one card.

canidothis

Am afraid options are so tight right now, have just been declined for two cc so darent go elsewhere x

RuthnJasper

A toughie. Sorry you're faced with this.

On balance - and with experience - I'd say no. Do NOT go with a CC. Put a little aside each month for the car tax - OR buy "car tax stamps" from the Post Office (http://www2.postoffice.co.uk/counter-services/counter-money-services/saving-stamps).

I did, with a similar interest-rate and history - and the upshot now is that I am back where I began, pre-cc spending, only now I owe the CC, as well as having the same problems I had before.

PLEASE don't make the mistake I just have made. Do you have family, friends, etc., who could lend you the car tax money on an interest-free repayment plan. Can you apply for a crisis loan from the Social Fund? Is there anything that the CAB can advise? Consider all these things before doing what (currently) looks like an appealing option.

A safety net is a wonderful thing - but only if it is tightly-stitched and won't split if you have to land on it...

Good luck. xx

SCO

What is the debt on the card?

BabyBetty

Hi,

I was in a similar situation earlier this month. Recieved a letter from Santander informing me that my Debenhams credit card rate would increase from 24.9% to 29.9% from 19th May 2011. My balance at the time was £1701. I must admit that I had been putting aside some money for things like car tax, mot and to replace my car later in the year. I had roughly about £800 so I used this with my overdraft to clear the card. Once this money was gone I had nothing more as a back up. To add to my misery I still have not been paid (supposed to have been paid on 15th April) so very low on funds but there are some things that will just have to wait to get paid. My aim now once I get paid is for my overdraft to be cleared and to put aside something each month so I don't depend on cards.

I have been chopping up and closing the cards as I clear the balances. Having a safety net has meant that I am able to not feel pressured into keeping high rate cards.

In your situation since the amount (available balance) is so low I would possibly keep the card open until you build up a buffer fund and then look at closing it.

I have just noted you have not mentioned what the actual balance on the card is at present, just what is currently available. Can you provide the figure as the answer might be different if everyone had a clear picture.

BB

book12

Assuming you pay your balance on time, you won't be charged interest. In that case, keep the card.

dresdendave

book12 wrote: »

Assuming you pay your balance on time, you won't be charged interest. In that case, keep the card.

Athough the OP hasn't stated what the outstanding balance is, it seems their finances are stretched, so it's unlikely they are paying the full balance off each month. Also if they always paid in full, they wouldn't have an issue with the interest rate rise.

canidothis

Hi Guys

My balance is currently £1676, interest is about £25 per month and Im paying £60 per month - I also have two other cc which are maxed and cards are cut up (total being paid to these two is £290 per month). I am trying to get money put away for car tax even if its only 6 months I feel thats better than putting 12 months on a cc. I havent had to use my CC since beginning of March so maybe just maybe I could get rid of it?