Interest rate freeze - does this affect credit rating?

littlemissb

I have a £6,100 credit card debt with a whopping 35% APR interest rate!! I can't transfer the balance as I also have a loan of £10,000 and in total this is more than my salary (albeit only just).

If I ask my credit card company to reduce the interest rate, will this affect my credit rating? And what do I need to say to get them to reduce the rate?

My fixed monthly expenses are:

£340 loan
£220 credit card minimum repayment
£100 board with parents
£26 phone
£15 contact lenses
£50 petrol
£25 sponsored child

When you factor in other things such as prescriptions, dentist trips, MOT, car insurance etc, this leaves very little to throw at the debt.

Can anyone advise or tell me about similar experiences?

Thanks in advance!

Tixy

Hi

If its just a informal request to ask them to reduce the standard APR then it wouldn't affect your rating - and occasionally ringing them up to ask this can get them to drop it a few percentage points. If you have missed payments or are unable to keep up with payments and write to them asking to freeze interest then it would affect your rating.
Some lenders (eg MBNA) will sometimes agree to an interest freeze for 6months just via a phone call and these are often marked on your credit file with an arrangement to pay marker, although they don't always make that clear on the call.

Have you done a detailed statement of affairs including all those other costs you mentioned to see how much you have left for debt repayments each month? Can you increase you earnings with overtime or a part time job? Do you have anything you could sell to raise money to put towards the debt? Could you reduce or cancel your charity contribution in the short term to free up a bit more money?

shiny76

littlemissb wrote: »

I have a £6,100 credit card debt with a whopping 35% APR interest rate!! I can't transfer the balance as I also have a loan of £10,000 and in total this is more than my salary (albeit only just).

If I ask my credit card company to reduce the interest rate, will this affect my credit rating? And what do I need to say to get them to reduce the rate?

My fixed monthly expenses are:

£340 loan
£220 credit card minimum repayment
£100 board with parents
£26 phone
£15 contact lenses
£50 petrol
£25 sponsored child

Whilst it may be a noble/admirable cause, you can't really afford to sponsor a child. Can you stop this, at least until you've got your debts under control?