I need some advice please

fox33

Hi
I need some advice regarding credit cards and reducing the monthly outgoings, have read most of Martin's write ups on here but still not sure the best way forward, so here goes.
Current cards are as follows

Yorkshire bank - £6750 this used to be Matalan
Paying £200 per month off this of which only £100 is coming off each month

BHS - £638
Paying £30 P/M of which £14 is then added each month in interest

Dorothy Perkins - £824
Paying £35 P/M of which £18 is then added in interest

As you can see its gonna be a long haul to get these sorted
I'm wondering which is the best route
Would i be better off getting a loan over 5yrs and paying the lot off or transferring some of it to say The Texaco 3.9 % life of balance

Any help would be appreciated
Thanks

b44rch

I would try to get one or more SBT cards, so that atleast you don't have to pay interest on part of your debt for a while; this will enable you to pay off more, as the full amount you pay every month would go towards reducing the balance.

I don't think a loan would be any good, as the interest rates are usually quite high - unless you can't get any other cards with a lower rate. The texaco card might be an option. You want to get the lowest interest rate possible, this way most of your repayments would go towards reducing your balance instead of just paying off interest. You'll need to reduce your balance otherwise you'll be stuck with these debts for a long while...

jellyhead

i think the dorothy perkins one is charging you the most interest? apply for a 0% card and maybe a texaco one as well (3.9% is great, not as low as zero obviously but it's a long term offer. i have 2 thousand on mine and the interest is only £6 a month, min payment £40).

a lot depends on how much people are willing to give you. not everyone is given a high credit limit when they get a new card so it may be that you can only transfer some of your debt onto the cheaper cards. if so you'll need to look at what else is cheaper than your current cards. loans are probably cheaper (but not as good as the 0% or 3.9% so use those up first). i've got a loan at 6.3% from marbles. i'm guessing that your current APR's are around 15-20%. my overdraft (8.9) is also lower than my credit card APR (plus the interest isn't charged on the same amount every day, when the salary goes in we're charged less interest because our overdraft isn't as high as it is towards the end of the month when the salary has been spent). to keep our overdraft as low as possible to reduce the interest we keep one of the credit cards for monthly spending - this card gives us cashback once a year and we pay it off in full every month by direct debit. the direct debit is taken after the salary for the next month goes in so the shopping money for each month is still sitting in the account at the end of the month waiting to be taken by the credit card, we get our shopping interest free and with cashback this way.

sorry if that's lots of waffle lol! but transferring our debts to cheaper interest has meant we are paying them off sooner :-)