Help and advice needed please

bobo_frett

Hi there, I'm looking for some advice. I was debt free for a while until I was made redundant and carless. New job appeared, bought a car on credit cards thinking this was the smart decision. This was about 3 years ago and I've hardly made a dent into it although I've tried to credit card juggle I am still £9k in debt. I'm in a new relationship, two kids, only earner (partner is starting up a business) and I really want to clear this debt as it is like a noose. Should I just get a loan out? Please help. I have a B/card, MBNA card, Virgin one and Santander on the go. I also have an empty b/card and halifax. I reckon I could afford £200 a month. Job security is another issue but I think that applies across the board. Please, please help.

EJG1982

hiya bobo

sounds like you been through some bad times but well done for getting in gear and trying to sort. in the right place for advice!

you're prob going to be asked/have suggestions said to complete a SOA (Statement of Affairs) so others in here can have a look at where and what your spending is going on to guide on savings etc.

i would personally want to ask is the £200 on top of what you already pay to the £9k on cards? Is this extra that you have available..

also, do any of the cards have 0% interest rates offers and do you know which ones have lowest interest if they dont? Another one is are all these cards maxed out, likewise what are the limits on the 'empty' cards..

pop a little more info on here and we'll all be more than happy to point you the right way lol

im subscribed!

bobo_frett

Brill, thanksEJG. Where will I find an SOA?

EJG1982

hiya

i have no idea if this will work but poss link is this.....

https://forums.moneysavingexpert.com/discussion/562271

if it doesn't its under forum page for debt free wannabe, thread about 3 down i think, advice for newbies. Excellent stuff there to get started with all the other links you need like SOA!

if you cant find someone will no doubt link it properly shortly! let me know if it works as it means i learnt how to do something techy :rotfl:

EJG1982

ok update.. works when i click it so think we're good to go LOL

bobo_frett

It works. I have been sorting out all these bits and now I feel a bit sick. Crying face

Okay.
My partner has no regular income at the minute so I can't account for that. She is paying her credit card off too using her £80 a month child benefit and that covers emergency shoe bits and the like for our junior who lives with us. Everything else is on my wage

My salary (basic, I do some extra hours here and there but nothing fixed): £1464.
Rent-475
water 45.44
Electricity-66
Coal-36
TV-12.12
Council Tax-99
Mobile-8
Shopping-220 (ish)
Petrol-120(ish)
Child Maintenance-100
Credit Cards-150(ish)

Total-1331.56

I am in the black with my bank and have £1000 overdraft which I clawed my way out of last year before moving in with my partner. So that's a positive (I think).

Here is the horrible bit.
Credit Cards.
barc platinum simpl-debt 461.23. limit-2700 no special deal
barclaycard-debt 0 limit-5000 special deal 0% until1/9/13 2.9% transfer fee
Virgin- debt 3467.26 limit 10000 (paying off £1254@15.9% and £2377.19@0% until Dec 2012) special deal 0% until 13/8/2013 3.5% transfer fee
Santander-debt 2528.78 paying 15.9% APR urgh
MBNA-debt 2471.61. Limit 6000 paying 0%until 25/9/12 Special Deal 0% until 23/10/13 3.5% transfer fee.

How does that look. (fingers are over my eyes)

EJG1982

Firstly... this is not bad at all, great position in terms of these offers so make the best use of them.....so

Barclaycard £0/£5000 0% 1/9/13 2.9% TF
Barc platinum £461.23/£2700 no special deal
Virgin £3467/£10000 £1254@15.9% £2377.19@0% until Dec 2012 Special deal 0% until 13/8/2013 3.5% TF
MBNA £2471.61/£6000 0% 25/9/12
Special Deal 0% until 23/10/13 3.5% TF
Santander £2528.78 15.9% APR

In short come the end of 2012 you will have none of the £9k on 0%, your first step is to make use of these offers and empty cards, the £5k B/card is brilliant.

I personally would do something like this. Very rough workings but you get the idea

Barclaycard £4544/£5000 @ 0% until 1/9/13
Move MBNA to here £2471.61 (£2544 with fee)
Move as much of Virgin balance as you can to here, prob around £2-2.2k with fee

Barc platinum £0.00/£2700 no special deal GONE

Virgin £1467/£10000 £1254@15.9% £2377.19@0% until Dec 2012 Special deal 0% until 13/8/2013 (Not sure how the split would be but overall balance reduced)

MBNA £3100/£6000 @ 0% until 23/10/13
Move Santander to here £2528.78 (£2617 with fee)
Move Barclaycard to here £461.23 (£477 with fee)

Santander £0.00 15.9% APR GONE

This would give something like £7.5k or more on another years worth of 0% and clear 2 debts so only dealing with 3, much easier to manage. You cant use MBNA to pay Virgin and vice versa

While you're there, if the lovely lady's c/card is not on an offer (and not virgin/mbna) you could transfer this balance to the your 6k MBNA or Virgin aswell, then she could be paying it off that instead of paying interest on hers?

My next step would be find what all the min.payments are, on 0% these are generally low as only a small % of overall balance. Sometimes as low as 1%, (£30 on £3k) well you should have an idea on the ones that are currently on 0%

Once you know min.rate to pay, put as much as you can as extra to clearing just one of the balances at a time. Example, first step Virgin as paying interest, once clear, transfer payment to Barclaycard as rate end sooner, once clear move all payment to MBNA….classic snowballing

Im no finance expert but have recently done this with our £14K! Though ive reversed it and paying the short term 0% offer rate first. Best to just have a look once transfers are done & you know what available funds you have.

With the amount of disposable income you’re going to have this wont be clear within the year unless you can find around £600-700 per month to put towards it. However, look at it this way, if you can find £300-350 per mth, just 2 years it could be gone. All depends on how much you guys want it. A loan of this amount will be around longer & less freedom to clear

There certainly is nothing stopping moving these balances towards the end of there offer periods & keeping all this in 0% until clear. You’re in a extremely good position to make a difference,

With your overdraft, if that’s paid & you’re not dipping in each month, keep it that way, again very good position to be in.

I will say your monthly breakdown can be tightened up, rather than ‘ish’, make a definite budget & stick to it. Now I know you have a little one to feed etc but me & my fella have a £200 food budget & I struggle to spend, more £100-150
Before I budgeted I looked at my last 3mth statements to see where little spends were going, gave a sensible starting figure & so far haven’t met them so I know I can shave more off. Personally, I think you could easily set aside £250-300 for this debt…

Rake through what you & your lady spend with a fine tooth comb, start look at alternative/own brands with shopping, get fuel/food at Tesco/Sainsbury & use the loyalty cards, make use of the money off vouchers, think twice about non essential purchases, do you actually need it??!! It’s the best way to see where the dollars going & how to claw it back..

Soz if its pointless babble but let me know how you get on. :beer:

bobo_frett

Hi EJG,
firstly I want to thank you for taking the time to read through my worries and then to actually offer advice.
I am genuinely touched by this. It's much appreciated.
Secondly, the fact that you can add positives in there is brilliant, that really lifted my spirits. It's not all doom and gloom, this debt can and will shift.

Thank you, thank you, thank you.

I am on with it! I'll keep you posted if you like.

Many thanks

EJG1982

no worries bobo means alot to know even the smallest bit of babble i chuck out there might help someone. Been through most of my trials and tribulations alone (my own fault) and my god i NEVER want anyone to experience that so anything i can do that might just help someone out is worth it.

And do keep us updated, im subscribed so can pop along anytime LOL

Keep it updated even just for your own sanity, really is amazing how much you can learn from here. Keeps the goal alive daily/weekly whenever, worth it for the sake of 5mins having a nose round a forum eh!

Good luck & get on with it!!! Everyday counts with debt, think about the interest LOL!!

ChopinonaBudget

Hi bobo,
Have you checked that you are eligible for tax credits? On that income I would guess you would be able to get something... You've certainly nothing to lose by applying

You might even be eligible for housing benefit and/or council tax benefit, I'm not sure, it's been a while since I was on either of these. But you don't have to claim the full amount of either to get either, and if you're on even a scrap of tex credits or other benefits then you are entitled to free prescriptions etc.

ChopinonaBudget

P.s. are you sure you're in the right council tax band? £99 per month sounds very steep for a property that's only worth £475 pcm in rent.