What should I do with my debts?

reddyteddy

Hi guys,

I have £13000, £1600 and £1600 on three credit cards and £2000 in payday loans and wondered if anyone could give me a bit of advice on the best way to deal with this.

I am not behind on any payments with the above but went to pay day loan providers to get me over a sticky patch and have kept returning and the debt has gradually built up over the last year to an amount I recognise is now getting to be a problem for me.

I have a steady enough job and should in theory be able to manage to service/reduce this debt but feel I just keep rolling things over every month and I'm not getting anywhere.

My big credit card debt is with Barclaycard and most of it is interest free for another 10 months.

My problem is that my debt level is possibly preventing me take out another interest free deal.

I also have one more monthe before an arrangement to pay note drops off my credit file.

should I roll over for another month or two and then go for an unsecured personal loan? or should I go down the secured route and try and clear this off asap?

I have a good amount of equity in my house and could possibly add to my mortgage but I am only paying 3% interest and probably wouldnt get that deal if I re-mortgaged?

Thoughts appreciated

Alex

ellesbellesxxx

Hi there Alex,
Well done first of all for realising something needs to be done! I would not recommend getting a loan at all... instead, servicing the debts is your priority. The payday needs to be done first as this will keep going otherwise.

If you fill in a SOA (Statement of Affairs) http://www.makesenseofcards.com/soacalc.html honestly then post it, people will be able to advise you where to start. Sometimes seeing it for yourself you can identify areas to cut back on straightaway to service your debt.

Good luck!

MusicalLawyer

It's always best to pay the highest interest first - which in this instance would be the PayDay Loans, whilst only paying the minimum balance off the 0% Barclaycard CC, and maybe just the interest on the other CC's, unless the minimum is more than that, then pay the minimum.

Post up your SOA so people can see what you're spending where, we may be able to advice places to cut back.

If your first figure for your CC is correct (£13,000) I doubt you'd be able to get another CC or personal loan. Loans aren't advisable anyway as unless you close the CC's you could be in a worse position in a couple of months time.