A positive message to everyone

misslizi

Hi,

After many years of sitting back, reading tons of advice and help I am finally ready to tell my story and feel today was a light at the end of the tunnel.

My husband and I bought our house 4 years ago and had no debt other than the mortgage, however we soon realised we were too young and had too low salarys to keep up with everything. We began to use credit cards as back ups and bought luxurys when we didnt need to. When both my husband and I had amazing promotions at work (our salaries are now double what they were) we began to live up to this new lifestyle, buying new cars and generally over committing ourselves.

We had 2 x HSBC cards with total of £4800 and 2 x barclaycards with a total of £3800. It may not sound like a lot to most people but working for a bank I knew I wasnt being sensible and when our 0%s ran out recently I was making as much overpayments as I could with our higher salarys but nothing was clearing anytime soon and I couldnt see an end to it. I worked out timescales etc on calculaters on this website and others and it was still going to take several years to clear the cards, not taking into consideration the large overpayments would probably have to stop once our mortgage rates go up.

Id like to stress we have never missed any payments and paid more than the minimum each month on the highest interest card.

Today we swallowed our pride and went to see our bank - HSBC.

The lady was fantastic, she looked through everything and agreed a loan with us, over 3 years at 7.5%, with the conditions that every single credit card we have is closed down, she sat there with us, paying off all the cards and closing them all down.

The payments to the loan are the same as they were to the cards and after using several tools on here we have calculated we are knocking around 3 years off the length of time it would have took to clear the credit cards (the interest rates were really high).

I know a lot of people are against consolidation loans however I addressed our credit issue a long time ago - credit cards were cut up over a year ago and we havent borrowed any funds in over a year now. The interest rate on our loan with the bank is great, they allow overpayments at any time and we will be debt free in a maximum of 3 years.

I will never touch another card again. I know some people on here may have missed payments or may not be able to get a loan but if you are in a similar situation to myself, try speaking to your bank, they really suprised me and I am happy to say I havent felt this relieved since we bought the house.

So!.... Heres to being debt free in 3 years...

rictus123

Thanks for the positive thread! I pay 570 a month as it is...could come down to about 300 a month if I consolidated...that would mean max 3 years till debt free but Noone will lend me 9k with 9k debt...I'm Overpaying massively though and doing masses of overtime so should take no longer than a year now

dreamdreamer

I know a lot of people are against consolidation loans however I addressed our credit issue a long time ago - credit cards were cut up over a year ago and we havent borrowed any funds in over a year now. The interest rate on our loan with the bank is great, they allow overpayments at any time and we will be debt free in a maximum of 3 years.

Sounds like you're the perfect candidate for a consolidation loan - someone who sees it as a means to an END of debt. Not a means to freeing up credit, which is how it seems to be used all too often these days and is why it's so hard to get one. Plus I assume with your payrises you're able to cope with your living costs now, as you've survived without credit for a year. If you want to feel even better about it, sit down and work out how much interest your cards would have cost you until they were paid off, compared to how much interest you'll pay on the loan! I worked it out after I got my loan last year and it's saved me 4k. The loan (and subsequently overpaying said loan) has knocked 4 years off my debt free date. Good luck, I hope it works out as well for you as it has for me!

KPR11

Well done MissLizi!

You have certainly used consolidation in the right way. Continue overpaying and you will be debt free in no time.

Good luck and keep the hard work going