How do you tackle high interest on credit cards??

jenniferwren

Some advice please!! I have a Virgin (MBNA) credit card which I orginally set up to transfer a balance from another card for an interest free period of 12 months. This was in 2009. I now have a balance of £14k, Virgin have steadily put the rate up from 16.5% to 24% APR. I received a notification from Virgin that they were going to increase the rate again to 27%!!! I opted out and cancelled the card but continue to pay off the minimum payment each month. I am paying around £300 each month, (I have noticed that some months the payment is higher than others, goes down and then goes back up by a few pounds??), this amount just about covers the interest and does not go towards paying back the actual debt. I cannot afford to pay any more than £300, but would feel alot happier if a portion of this goes to pay the debt and not the interest. Can you tackle credit card companies in the same way you can banks for unfair charges??? or some advice please on how to approach MBNA to see if they will freeze or lower interest so that I can at least have some chance of paying off this debt this century!!!

Tixy

Hi jennifer - I posted this on your other thread but in case you didn't see it

You can always try and ask if they will lower the APR - occasionally a card provider will agree to - however once you have opted out and the card is closed people don't generally have much luck (or not unless they cannot meet minimum payments and enter a DMP and be prepared to wreck their credit rating).
But you cannot try to reclaim it like with card charges. have you had any card charges for missed payments or overlimits on this card at all?

You really need to try to find some way to pay a little more than the mininmum - even a few quid more a month will make a difference in the long run.

If you only pay the minimum payments it will take 28years to clear this debt.

If you keep the payment at £300 a month it will take you 180 months to clear the card - thats 15years. If you can up your payment to £320 a month then it'll knock 5years off that.

Might be worth posting up a statement of affairs to see if people can spot areas you can save money/get things cheaper or cut back somewhere so you can try and put a little more each month to the debt.

BeautyandtheBeast_3

Hi Virgin changed the way that they calculate the minimum payments. They charge me 1% of the balance plus the interest. just double check they are doing that with you. The dd will take for example £104.55 this month, so round the overall payment up to £110 by transferring over £5.45 extra. This is helped to bring it down a little bit at a time. I tend to think its a marathon not a sprint, but the marathon has little bursts of energy now and then. You will do it, it just maybe a little longer than hoped but it will go!!!

CatchFazed

I had a similar situation with Barclaycard a few years ago - they wanted to up my rate from 14% to 24%! A few months previously, they'd also increased my limit by over £1000 :huh:

I called them up and asked why they were upping my rate and they stated it was due to my credit profile. When I asked why I was then offered extra credit a few months previously, they were very quiet!

I managed to negotiate a lower rate of 11.9% as long as I spend £50 per month on the card (which I use to do my tesco shop, then put the money straight back in).

Good luck in getting a better rate x