Shall I get a consolidation loan?

tubsolard

Hi,

I have a credit card with about £3,000 and an over draft that I'm into by £1,000 on an account I don't need / use but I'm paying £30 a month for the pleasure (£1 a day for the time I'm over drawn).

I'm freeing up some cash at the moment and as of August this year will have paid off all but the above debt so I want to make a big effort to cleart in order to look at buying a property.

Ideally I would like to get a loan for £4,000 to clear the above in 12 months so by this time next year I'll have no debt and it is conceivable that I can afford it, if not then I could drop to £3,000 and clear the credit card and as much as I can on the over draft.

Question is, should I do this? or should I just put the cash into those debts? The interest rate on the card is not great but I dare say that (having been over my credit card limit as recently as last 1/2 months ago) I won't be able to get a loan with a good rate either.

I can see some light at the end of the tunnel and I was to make a final push to clear the debt (I've even moved back home with the parents to save on rent!

Appreciate the help and any suggested loan companies for poor credit (although no CCJ's just the credit card limit being slightly abused).

Thanks for your help.

Scott

camuk81

Best thing Tubsolard is start with a statement of affairs to work out where you are.

From there you can work out what you owe and if you can trim back anywhere.

As regards consolidation loans they take a lot of commitment to go through I've failed on 3 so far and I'm doing it the old fashioned way as none will lend to me any more. If you are going to do it make sure you close off the overdraft and credit card otherwise a few months/ years down the line you could end up with 8k worth of debt!

tubsolard

Thanks Cam

You are right, I've been here before and one my last consolidation loan finishes in August this year and yet the Credit Card and Ovewrdraft are still there - so I guess that speaks for itself!

I think I can cope for a year though. I'm quite optimistic at the moment that I can realistically be debt free in a year whereas up until now it's always been a very long term goal.

I think I can stick to it but I can't resist a treat every now and then so I will have to be disciplined!