Sinking deeper...

BlewIt

RAS wrote: »

you need to set up and escape account with someone not in any way related to RBS, in case things get sticky.

any recommendations?

BlewIt

Little_Miss_Uni-Debt wrote: »

PLEASE don't consolidate. It seems like you've got around £10k debt now, if you are offered a loan - it won't be at a helpful APR% rate. You'll then be in between 12K-14K debt just by signing the papers! I know it's difficult but taking on more debt takes you further away from being debt free. Freeing up income now doesn't fix the reasons why you spend on your cards. Only a budget does that

could anyone explain this to me mathematically?

i don't get how continuing with debts being charged interest @ 30% APR can be any less expensive than a debt with interest at say @ 15% (and possibly less - maybe even 10%)

Little_Miss_Uni-Debt

Because a loan would be at 15% EVERY year you have it and you would have a loan longer than the cards (hopefully)

You would be tackling your 30% card first so actually your overall APR% on the cards would drop as you paid off the higher cards. It all depends on how much you can throw at your cards each month.

The snowball calc will work it out for you http://www.whatsthecost.com/ You need to see how much it would cost you per month to pay off debts before the interest is higher than a loan would be. I estimate a loan would cost you between £2k to £4k in interest (depending your credit rating)

Also if you take on a loan you are just free to spend on the cards again. Plus there is nothing to say you would be able to get a loan with banks being so tough on lending now.

Hope this helps!

Skint_but_Optimistic

I admit tackling the debts head on is the best way. The snowball calculator has helped me alot too.

RAS

For

BlewIt wrote: »

Unsecured Debts
Description....................Debt......Monthly.. .APR
RBS Loan.......................2837......216.......11. 2
RBS Card.......................1179......27........30. 6 - any spare capacity on this card? about £400
HSBC Card......................1237......31........34.6 - this is your priority
RBS Overdraft 2................1000......13........16.7
RBS Overdraft 1................1380......18........16.7
MBNA Card......................2015......55........29.9 - any spare capacity on this card - £2100 limit
Total unsecured debts..........9648......360.......-

Right for the next month (ish) every time you buy petrol or food, put that on the RBS card.

Then immediately pay exactly the same amount towards the debt on the RBS card. Obviously stop when you are about £50 short of the limit on the RBS card. That way you transfer £350 to a lower APR, which measn that your monthly payments reduce a bit. Looks like you could also make one purchase around £35 on the MBNA card as well.

It is only 4-5% reduction but it is better than a kick in the teeth and cost you nothing but self discipline. When you have cleared the HSBC card ring up to cancell and if you are lucky they will offer you a balance transfer at a lower rate than you have on one of the 29-30% cards. Even if it is only a £500 limit, take it off the RBS card as long as the transfer fee is less than the percentage gain.

BlewIt

Cheers,

I have applied for, and been accepted for a new current account with Santander. It asked on the form for my current OD limit so i put £2600 - no mention if this has been granted in the acceptance email. If it has been accepted it is 4 months interest free.

If that is the case i was going to pay off some of the cards with it. History has shown that MBNA offer the most frequent & best interest free balance tranfer offers so i was going to do that one first (i know thats against the system proposed as its not the highest interest but it should trigger the best offer and therefore best longer term) - shoot me down now!

BlewIt

RAS wrote: »

For




Right for the next month (ish) every time you buy petrol or food, put that on the RBS card.

Then immediately pay exactly the same amount towards the debt on the RBS card. Obviously stop when you are about £50 short of the limit on the RBS card. That way you transfer £350 to a lower APR, which measn that your monthly payments reduce a bit. Looks like you could also make one purchase around £35 on the MBNA card as well.

It is only 4-5% reduction but it is better than a kick in the teeth and cost you nothing but self discipline. When you have cleared the HSBC card ring up to cancell and if you are lucky they will offer you a balance transfer at a lower rate than you have on one of the 29-30% cards. Even if it is only a £500 limit, take it off the RBS card as long as the transfer fee is less than the percentage gain.

will do, i like that. thanks.

RAS

BlewIt wrote: »

could anyone explain this to me mathematically?

i don't get how continuing with debts being charged interest @ 30% APR can be any less expensive than a debt with interest at say @ 15% (and possibly less - maybe even 10%)

Go to the snowball on www.whatsthecost.com.

It does depends on the APRs and the term of the loan. If you can get a 15% loan for £4500 over three years and pay £156 then you only pay £688 in interest.

Which is great is you completely stop using your cards but that is more costly than you current deal each month.

If you try and reduce the monthly payment to £80, then it will take 8 years and cost £3140 in interest payments.

With payments of £156 per month, even at 29%, you will clear the debt in 4 years at a cost of £2961.

RAS

Well done - time to tart those cards if you can.

but you must add all of these into your SOA - hit the edit button.

BlewIt wrote: »

Groceries etc. ......................... 110 - you can take £30 off this no problem - will try
Clothing................................ 0 - never? realistically £30 a month
Petrol/diesel........................... 180
Road tax................................ 0 - how much is this per year - divide by 12 and account for it. - £17.50
Car Insurance........................... 38
Car maintenance (including MOT)......... 0 - how much did this cost last year? Divide by 12 and save it separately - £42

Presents (birthday, christmas etc)...... 0 - never? - £20
Haircuts................................ 0 - never? - nope!
Entertainment........................... 0 - ditto - £20 - £150

BlewIt

Updated SOA

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 1
Number of children in household......... 0
Number of cars owned.................... 1

Monthly Income Details
Monthly income after tax................ 1204
Partners monthly income after tax....... 0
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 1204

Monthly Expense Details
Mortgage................................ 0
Secured/HP loan repayments.............. 0
Rent.................................... 400
Management charge (leasehold property).. 0
Council tax............................. 0
Electricity............................. 0
Gas..................................... 0
Oil..................................... 0
Water rates............................. 0
Telephone (land line)................... 0
Mobile phone............................ 0
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 110
Clothing................................ 30
Petrol/diesel........................... 180
Road tax................................ 17.5
Car Insurance........................... 38
Car maintenance (including MOT)......... 42
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 14
Buildings insurance..................... 0
Contents insurance...................... 0
Life assurance ......................... 0
Other insurance......................... 8
Presents (birthday, christmas etc)...... 20
Haircuts................................ 0
Entertainment........................... 50
Holiday................................. 0
Emergency fund.......................... 0
Total monthly expenses.................. 909.5


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 1500
Other assets............................ 1000
Total Assets............................ 2500

No Secured nor Hire Purchase Debts

Unsecured Debts
Description....................Debt......Monthly...APR
RBS Loan.......................2837......216.......11.2
RBS Card.......................1179......27........30.6
HSBC Card .....................1237......31........34.6
MBNA Card......................2015......55........29.9
RBS Overdraft 2................1380......18........16.7
RBS Overdraft..................1000......13........16.7
Total unsecured debts..........9648......360.......-


Monthly Budget Summary
Total monthly income.................... 1,204
Expenses (including HP & secured debts). 909.5
Available for debt repayments........... 294.5
Monthly UNsecured debt repayments....... 360
Amount short for making debt repayments. -65.5

Personal Balance Sheet Summary
Total assets (things you own)........... 2,500
Total HP & Secured debt................. -0
Total Unsecured debt.................... -9,648
Net Assets.............................. -7,148