Eeeeeeek!!!!! Is This Right????

vindalooloo · 26 December 2006 at 8:16AM

Just going through my finances to go into the new year with - pretty crap really as you know. Spent about fifty quid extra on the CC over Christmas (needs must!) so my payment of £45 last month was cancelled out effectively.

Anyway .... just gone onto one of those calculator sites and put my CC balance in. It's telling me that on £1972, paying £39 a month it will take me TWENTY THREE YEARS to pay off this debt. I'll be bloody 69 by then?!?!?!?!?

Is this right? Bleeping hell!

Can anyone advise then if it would be better to just take out a £2000 loan over say, 2 or 3 years and pile it onto that? Our other loan currently running has about 2 1/2 years still to go so we would be able to pay both things off round about the same time.

Certainly don't want to be tied to this small amount for over £25 years :mad:

Sugarhunny1 · 26 December 2006 at 8:28AM

Morning Vindalooloo,

Well done for taking the time to work out that out! Just a small suggestion from a fellow DFW, Can you not take out another credit card (many doing offers of 0%) and do a balance transfer? Gives you a (possibly 12 months) few months of no interest.

Can you afford to pay more? If not then taking a loan wont help because the loan repayment will be more than your currently paying towards the CC, If you can pay more........... then put it towards your CC!

HTH!

Merry Christmas :-)

vindalooloo · 26 December 2006 at 8:39AM

Hi Sugar,

I have an egg card which has 0% on balances till Aug, which I haven't used yet, but I only have a limit of £800 on that one. I start a second job in January so our income will go up slightly.

Mmm, but I'm thinking that the interest will be far less on a loan. We've had the current one coming out of our bank by DD for 2 1/2 years with no probs (we've not defaulted on anything YET, with careful 'robbing Peter to pay Paul' techniques.)

If I take my CC balance and divide it by 24 or 36 (months that a loan would run for) and pay that much per month it still won't work though will it ... the interest on the remaining balance will keep shooting it up and up, if you see what I mean ... is that right, or am I puddled?

Sparky67 · 26 December 2006 at 9:43AM

Paying a minimum balance off a credit card with interest being added to it is tantamount to daylight robbery by the CC company IMHO. They will be adding on nearly as much in interest as you are paying off, that's why it will take so long to clear...

Transfer as much as you can to interest free, and pay as much as you can afford each month - not what they tell you!

EG if you could get an interest free CC with no balance transfer (and transfer again when that runs out) and paid £54 a month, in theory it would only take 3 years to clear...

SunderlandBlackCat · 26 December 2006 at 11:05AM

Hi Vindalooloo

I haven't caught any of your previous threads so just had a quick skim through them.

The first thing I would advise is don't take out any further credit until you know for certain your other half has had his lightbulb moment. I know it looks better on paper to take out a loan to pay off the credit card debt but in reality what will happen is that the loan is going to free up some space on the credit card & that will then get used again next time things are tight (Believe me I know from personal experience)

I didn't notice anyone pointing you to the snowball calculator on previous threads. You can use this to figure out how much to pay to each card once you've done a balance transfer to the 0% egg deal. Also if you've not missed any payments before you should be able to qualifiy for other 0% cards that you can transfer the rest of the balance to or it may even be a better option to get the &more card from M&S as they do a 3.9% life of balance deal & no transfer fee. Again the snowball calculator will be able to help with working out if this is the cheapest option.

One other thing I would advise is to cut up the non-0% cards as soon as you have cleared the balance. The other thing is that the egg card offers a 0% bt rate every year on the anniversary of the card so by shuffling your card balances around you can benefit again next year (but make sure there isn't any outstanding balance on it before you do)

vindalooloo · 26 December 2006 at 5:14PM

"The first thing I would advise is don't take out any further credit until you know for certain your other half has had his lightbulb moment."

He's coming round to it. Had some serious discussions this last week and I might have him 'on board' at last!

"it may even be a better option to get the &more card from M&S as they do a 3.9% life of balance deal & no transfer fee"

That sounds FANTASTIC - much cheaper than a loan. Just depends of course whether they give us enough 'credit' to transfer the balance of the other card. If we made a joint application (so we could add both our wages together as incomings) do you think we would be able to get a larger figure to transfer up to?

savememorecashmartin · 26 December 2006 at 5:46PM

vindalooloo wrote:

It's telling me that on £1972, paying £39 a month it will take me TWENTY THREE YEARS to pay off this debt.

Can anyone advise then if it would be better to just take out a £2000 loan over say, 2 or 3 years and pile it onto that?

https://www.moneysupermarket.com loans pages are showing that someone with a reasonable credit rating can borrow £2000 over three years for £59 a month. Ok it's bit more a month and the payments won't go down as the capital reduces, but there you go, three years and it's gone. Just remember to cut the card up.

COOLTRIKERCHICK · 26 December 2006 at 5:47PM

hi...vindalooloo........

i transfered bal.. from some credit cards to tescos credit card in the summer.... which was 0% on bal transfers.. had to pay 2 %.. but that worked out cheaper than a months payment......that offer finished this month......

so i have opened and transfered to m & s credit card... which is 3.9% of the bal transfer.. with no transfer fee....

i will then have 3 credit cards with 0 bal......

so after the new year... i will be contacting them.. to see if they do a 0% transfer.... ( which they prob..will)

say they do 0% for 9 months..i will only transfer over what i know i can pay off in 9 months...so i dont get stung with higher interest after the 9 months

so basically what i have done is jumped from one credit card to another..... then back again to the first card.....

card hopping between now 4 credit cards.... i need the m & s low interest one as a secure base really as peace of mind.....just incase i forget to transfer.. and have high interest rates.....

hope that makes sense......

but maybe for peace of mind it might be worth transfering to the m & s credit card... and the lower 3.9 % for the life of the bal transfer.. and just throw every spare penny at it......

COOLTRIKERCHICK · 26 December 2006 at 5:49PM

oh..yes i forgot......to say...... if you are going to apply for a new credit card/loan etc...

go through quidco.... or a cashback site.... so you will get some cash back......

it all helps....

cathybird · 27 December 2006 at 8:59AM

hi vindalooloo, if/when you transfer the balance or get a loan, make sure you ring the provider of your current credit card and close the account, as well as cutting up the card. Otherwise the account will stay open and they will probably send you a new card at some point, making it tempting to start spending on it again. Also the more accounts you've got open the harder it is to keep getting 0% deals. Each time a balance is switched the old account really has to be closed. Good luck with it all x

cathybird · 27 December 2006 at 9:02AM

also, forgot to say – if you can scrape up more money from anywhere to throw at the debt, then do, and if you do get a loan (which is dangerous because it leaves the credit card free and you can easily end up maxing out the credit card again, thus ending up with both debts), make sure it's flexible and will allow overpayments if possible, so you can get rid of it sooner