10K CC Debt Cycle

udydudy

If your friend has the 10k on 4 barclaycards then I do not think you should be looking at another Barclay card as he will not be allowed to transfer balances between two barclaycards.

Why not have a look at this credit file before any applications to see how many missed/late payments have been reported to the credit reference agencies by Barclays. The statutory reports cost only £2 so a total of £6 if you order all three: Equifax; Experian & Call Credit. The last one you could try going via noddle which I believe is still free and shows you the callcredit report but I think 1 month late.

IMHO, if he has missed payments on his CRA reports he would best be applying for "Bad Credit" credit cards as he will be rejected by most prime lenders and it would be unecessarily an extra search on his file.

But the flip side of these "Bad Credit" cards is that they have lower limits and also have a very short promo period. Example the Capital one Classic card has a maximum limit of £1500 and has a 0% promo upto Aug 2012(4 months) but it is available even to people with CCJs.

Your friend will have to pull up his socks and start spending less and saving more otherwise he will only get into more trouble as the debt increases.

One other way would be to talk to Barclay card and freeze the debt which would effectively cancel the card and all charges would be frozen but he would have to send them a statement of affairs to prove that he cannot manage to pay. But this woul dget recorded on his credit file and would affect future credit applications.

Deru

The risk is he may use that "new" available credit and max his cards again...

If he did manage to get it, I'll tell him to not spend on it. The credit would be used up via the balance transfer anyway.

missile,

Thanks for the advice. What's noddle? Some sort of cashback site? I've only ever used equifax and experian myself.

The thing with the Barclaycard lifetime balance transfer deal is it's meant to be open to existing customers. Logic may be that it's better that existing customers stay with them rather than take their debt to another provider. You might be right in that his credit may stop Barclaycard giving it to him but on the other hand, maybe more likely to be accepted because he's an existing customer?

Does that last bit of advice work? That sounds like basically declaring bankruptcy but straight to the card provider. Surely they'd refuse straight out as they'd lose money. I actually asked him to ask Barclaycard to see if they'll give him a reduced in interest rate, which might be more likely to work?

But the flip side of these "Bad Credit" cards is that they have lower limits and also have a very short promo period. Example the Capital one Classic card has a maximum limit of £1500 and has a 0% promo upto Aug 2012(4 months) but it is available even to people with CCJs.

I've had a look at these but after the 4 months or so, the rate shoots up to 30%. That and the low credit limit.

missile

Deru wrote: »

.... The thing with the Barclaycard lifetime balance transfer deal is it's meant to be open to existing customers. Logic may be that it's better that existing customers stay with them rather than take their debt to another provider. You might be right in that his credit may stop Barclaycard giving it to him but on the other hand, maybe more likely to be accepted because he's an existing customer? .....

I don't know where you got that idea? This offer is for new customers only, existing customers need to exploit "The Loophole Solution"

I suggest you go back and read the link carefully. [URL="http://www.moneysavingexpert.com/cards/barclaycard-offer-loophole"[/URL]

Deru

Ah, I missed something. Debt has to be shifted to a card from a different provider and then back again....

camuk81

And a bit of pre warning he would need to close down all the cards and then reopen 6 months later. Yep tried this one with Barclays myself about talking to switching to another APR

Getting_By_2

Only a lifestyle change will get him out of this mess. He needs to curb his spending ASAP.

tlh858

Barclaycard balance transfers are available to most existing customers for 6.9% (and sometimes less, such as 5.9%), but this is only of any use if you have credit available, and want to transfer from another card (NOT another Barclaycard or any other card they now own such as Egg).

But with nearly 10K debt on cards and an income of 20k, the only answer is to get the scissors out and cut up the credit cards, drastically reduce all other spending and pay as much as possible onto the cards every month.

Another loan or card is NOT the answer, and it's extremely unlikely he would get one anyway due to the existing debt being 50%+ of his salary.

Deru

Well, the loophole is NOT available to him. Most likely because he's missed payments. Logged into his account to see that he has no offers and one was a card with £70 left to spend. The option is available on my own cards. Or does it only show if you have less than 50% balance or something?

I was thinking of transferring to my Halifax card, then back again.

I think he's relying on the cards to eat...but cutting out luxuries is a must..

glasgowsaver2011

Deru wrote: »

Well, the loophole is NOT available to him. Most likely because he's missed payments. Logged into his account to see that he has no offers and one was a card with £70 left to spend. The option is available on my own cards. Or does it only show if you have less than 50% balance or something?

I was thinking of transferring to my Halifax card, then back again.

I think he's relying on the cards to eat...but cutting out luxuries is a must..

Transfer at your peril

Many people here (me included) have lent money and never seen it again.

I lent money to my best friend who then passed away

Her family did not want to know.

Luckily she had nominated me as a death benefit recipient.

Her family wanted to contest that too.

I got the money but I was very lucky!

udydudy

Deru wrote: »

.......What's noddle? Some sort of cashback site? ......

Noddle is a "free for life credit report" and is a part of Callcredit, so basically you see the same credit report details but as it is free it is one month late(from what I have noticed). So if say you paid late last month and your card provider put a late payment marker on your call credit file you would see it on Call credit report but on Noddle only one month later. The main thing is it is free...

Deru wrote: »

...........Does that last bit of advice work? That sounds like basically declaring bankruptcy but straight to the card provider. Surely they'd refuse straight out as they'd lose money. I actually asked him to ask Barclaycard to see if they'll give him a reduced in interest rate, which might be more likely to work?

It not exactly bankruptcy.... with bankruptcy after 1 year you do not need to pay anything but with a payment arrangement you are still liable for the balance as on the date of arrangement but future charges and interest costs could be frozen until paid. It is an option if your friend cannot get a card anywhere else nor get barclaycard to reduce interest rates. you would need to put all options in front and evaluate which would be the best one based on his cashflow. It is surfely better than having a high interest rate being applied and your friend not being able to pay even that amount.

Deru wrote: »

.......I've had a look at these but after the 4 months or so, the rate shoots up to 30%. That and the low credit limit.

Exactly the idea being that he keeps reducing the interest rate on that £1500 (if he gets the max limit) and then clearing that amount in 4 months.

Your friend is going to need a lot of will power and hard work to get this correct. if required a second job if he can find one.

Best would be if you put his statement of account on the debt management forum and I am sure if he stick to the bare minimum required to live he can get through.

If Barclays do give him another card(which I doubt ) then you can transfer your non-barclaycard balances to his new card and then shift the same amount from his card to your card. but remember he will incur the BT Fee twice. At the cost of sounding negative, I doubt barclays will give him another card whilst he is already struggling with existing debt.