advice please!

gymbunny_3

Hi All

My debt is primarily between a loan with halifax which I am paying 12.9% and a barclaycard which is 8.4K

Is there any way to reduce the interest on either? Have approached Barclaycard and they said no.

I am also being turned down for credit so I can't move the amounts to lower interest rate cards

Thanks

camuk81

Whats the barclaycard apr?

If its higher then 12.9 you need to clear out the Barclaycard first.

If you getting refused for credit it might be an idea to take a sep back and work out why.

Is you debt level too high for you salary

gymbunny_3

Thank you so much camuk for answering my post.

The barclaycard interest is 16.9% interest.
You are right - I have more than half my salary as debt which is the reason I am sure I am being rejected.
This is such a wake up call. I never ever want to be in this position again.

Ok - this might be really silly questions but here it goes

The barclaycard debt is actually 9.4K
1.2K is life of the balance @6.9% (I only transferred this a week ago)
the 8.2K is @16.9%
In terms of payments - what will my payment pay off first.
eg if I made a payment of 300 the next time I get a statement, will I get to pay some of the balance at the higher interest rate.

This is much further into the future, but can I buy a place even if I have outstanding money on my credit card or loan? I mean say if I have £6K remaining - could I still buy somewhere. Obviously this is quite far off, but I want to have something to work towards.

Thank you so much again

[Deleted User]

They will not reduce the rates until you fail to pay at least one payment.

This will then cause even more damage to your credit report.

You have to decide if getting the debt paid quick and cheap or your credit report is more important. If you don't mind having late payment markers and taking a few years break then miss a payment and request interest be frozen, don't make overpayments, pay minimum and then save surplus, you then use the surplus as a lump sum to settle (whilst be interest free).

I am in the same situation and I just have to make so as I want to sell and buy another home soon.

If you can wait 6 years before you need credit again? then you have some options

[Deleted User]

Sorry and meant to say you always pay the highest rated balances first, this is now the law.

foxgloves

When you buy a new home, the mortgage lender looks at what debt you have as part of your regular monthly outgoings. For instance, when we bought this place (long before partner or I had, had our lightbulb moments re debt & overspending....), my debts were not too bad at the time, but partner owed £16k as he'd made a loss on selling his previous house. We had enough positive equity on the house I was selling to be able to say we would be clearing this debt as soon as my house sold (which we did do) but the mortgage lender would only agree to lend whatever sum it was minus the £16k we already owed on the loan. This didn't turn out to be a problem as we didn't want to borrow the full amount anyway, but I think that would still be the case today....probably more so because of the poor economic situation. So, you can buy a new home if you have debts, but they will look at your ability to pay back anything they decide to lend you, so it could affect you in that way.

gymbunny_3

Thank you so much for your help foxgloves.
I know with this current economic climate, the lenders are tightening up.
Ideally I want to clear most of my debt and even if I have 8K remaining would like to start looking to buy.
The missing payment option is not really an option as I do want to buy at some point.

loveyourmoney

Gymbunny - am reading between the lines but do you have savings?

gymbunny_3

Not that much unfortunately loveyour money.
Due to changing circumstances, much of had to be used up
I have some shares not a lot by anyone's imagination, but don't want to touch them.
I just want to have a goal. The past few years have been so stressful and whereas I was a saver several years ago, I have been having to take out loans and credit.
However that is all stopped. I have worked out a payment schedule for gulp the next few years and hopefully will be in a position to look for a property. (This is in a few years but hey at least that is something to work for!)

camuk81

Welcome to your lightbulb moment. Scary thought!

Work on the highest apr as you make more of a dent. For every £231 you are paying at the minute £113 goes on interest. It would be great to reduce but first you need to clear some and work on your credit.

I was in your situation and keep applying till the credit lines dried up. Now doing it the old fashioned way but at least I won't be tempted to get a loan, splurge and have twice the amount of debt from the first time round

gymbunny_3

Hi All

I have had the lightbulb moment and still in shock.
Currently owe 13.7K on a halifax loan which is 12.9% apr
9.9K on barclaycard which is at 16.9%
and 5.3k which is interest free until July on a halifax card.

I can't borrow anymore, but wish there was a way of reducing the interest that I am paying.
I am trying to save a little while I am paying this to build an emergency fund.

Any advice relating to interest reduction would be greatly appreciated.