need advice please - i have poor credit

ceri

i've currently got two credit cards where i pay the minimum amount ( i know i know). recently, i have poor credit and i tried to swap my cards for 0% interest but because i have poor credit - i am now unable. Consequently the money i owe is going up and i don't know what to do. please help.

jamalfatty

If your making minimum payments and not using the cards there is no way the balance should be going up. If it is you have what is called 'negative amortisation' which isnt good.
You should try and increase your payments, or call the CC companies and tell them about situation, they may lower your rates as your balance should not be increasing if you are making min payments on time each month

This is from the British Bankers Association site....

10.12 We will make sure that your minimum repayment covers more than that months interest.

This means that the minimum repayment will cover that months interest and a proportion of the balance outstanding from the previous month.

The minimum payment amount on the account should be clearly shown. This amount should normally be sufficient to avoid negative amortisation over a period of 12 months (ie, the sum of 12 minimum payments would exceed the sum of additional interest added to the account over the same 12 month period). It is acceptable for the minimum payment amount to be calculated as a percentage of the balance carried forward, so long as the percentage would normally prevent negative amortisation. Other methods for calculating the minimum payment are also acceptable, provided this principle can be demonstrated

Which I would assume your credit card issuer is a member of.

anniecave

you need to do a statement of affairs to work out how much money you have coming in and where you are spending it on. You can work out possibly how to increase your money coming in, or how to decrease how much you are spending.
Then you can work out how much money you have spare each month to pay off the credit cards quickly
if you have poor credit then it's unlikely you'd be able to move the debts to 0%. What are the rates on the cards at the moment?

MSE'rs - Anyone out there ever got a rate reduced by asking? I don't know if that's possible but I think I've heard people who've phoned up and asked and they have reduced the rate?

anniecave

ps are you using the cards for spending each month? You need to aim not to spend any more on the cards if the rates are high.

jamalfatty

anniecave wrote: »

MSE'rs - Anyone out there ever got a rate reduced by asking? I don't know if that's possible but I think I've heard people who've phoned up and asked and they have reduced the rate?

Yes, and i've been reliably informed on the sly that you have a much better chance of this happening if you have other products on that account, such as PPI - might be worth phoning up day before you call to negotiate the rates to request this be added to the account. Then call to get rates reduced, and then cancel the PPI (Assuming you dont need it that is)

ceri

i have asked them to reduce the rate but no luck - i have also asked them to pay a lot less than the minimum beause i can't afford even the minimum payment and that's how the balance is going up - yes i'm in deep do do!!

jamalfatty

ceri wrote: »

i have asked them to reduce the rate but no luck - i have also asked them to pay a lot less than the minimum beause i can't afford even the minimum payment and that's how the balance is going up - yes i'm in deep do do!!

How long have you been paying less than the minimum? If its been going on a few months you could ask them to consider freezing interest/charges until you get things back under control.

You might want to start a thread in the Debt-Free Wanabee board for help on this.