Can't get rid of my damned credit cards

majic79

Well, this is probably a familiar story to some of you, maybe you can help me get free of my money leashes!

Like many, I tarted around a bit to keep my repayments low, but one year, I found that I had to spend some money I didn't have, so I used one my cards - lo and behold, I can no longer tart around as my applications get rejected! As the various interest free periods expired, I've been incurring interest and now my repayments are going up as the banks decide to up their rates. I'm not struggling, but between three cards, I want to stop paying so much interest!

I checked my experian report, and according to them, I'm using up too much of my available credit - well I'd like to change that! but because I'm using up too much credit, I can't take out a loan at a reasonable rate to consolidate it. for e.g, a £15,000 loan at 5.7% means repayments of £385 per month, which is less than the £425 I'm spending at the moment, and will pay off my debts in 4 years, instead of the 10 years plus the way things are currently going!

Can anyone offer me some tips? It's a bit of catch 22 at the moment - I need to have used less credit to take out a loan to clear up my credit!

danni.yelly

Ah I do hate credit cards!
Im still trying to pay mine off, it's haunting me!

But to try and reduce the interest on mine, I paid off as much as I could with my overdraft which is at a much lower rate than my credit card. So now my credit card has only £600 on it with a much more manageable £10 interest a month instead of near £40! And considering I can only pay £50 a month on it, it wasn't really paying much off.

Maybe your bank will extend your overdraft for you?

Better_Off_1983

Consolidation loans are hard to come by these days.

Its best to draw up a budget and note everything you spend on rent/mortage, council tax etc.

Then look at how much you have left for your credit cards.

Make cut backs on clothes, entertainment, holiday savings funds etc.

Try and see if you can pay more than the minimum payments on your credit cards.

Edited to add:
I know what you are going through. I was in as much as £30k worth of debt, I then claimed back the PPI on the various loans I took out 5-10 years ago and managed to recoup £6k in PPI. I used half that to clear some of the debt as well as paying more than the minimum payment with my income every month. I owe less that £2k now. I paid off a loan yesterday (£250.00 balance), will clear a credit card with the same bank at the end of this month (£292) and I will clear over £1200.00 on another credit card by Feb. The secret is paying more than the minimum payment. I drew up a monthly budget sheet showing how much I will pay creditor 1, creditor 2 and so forth and worked out the interest per month. I have even worked out how much better off I will be after Feb and so on.

I have been in debt for all of my 20s. I will be debt free before I am 30!! So it can be done with a bit of perserverance. Throughout my 20s I have just budgeted and worked out how much is ear marked for each creditor and living expense. I will be bored out of my mind come June next year with no pending payments to whomever to set up!

Also, I have two credit cards, and I only spend £20 per month on them, but I use them to get up to 56 days interest free. I have direct debits set up for the full amount each month. I do this so that is keeps the credit facility open. However, it will not surprise me if they write to me telling me that they will take the facility away or reduce the limits because I am not making them any money.

Were you a 'card tart' and just transferred balances to 0% cards and not paid off the debt and took advantage of the nill percentage rate?

I work for a credit card company and alot of people I speak to forget when the interest kicks in on the balance transfer and then go over the limit because of the interest.

Have you missed any payments on any of your cards, this could explain why you are getting rejected for new cards? Or it could be that you have over-committed on your borrowings.

HTH

majic79

My credit score is good - 974 - but I have three credit cards (with limits from £4k to £6k) that are pretty full, an overdraft that I've just managed to get out of and a joint account that is looking similar (my partner and I pay into that account and all of our bills come out of that)

I've always paid more than minimum payment, but having just got married this year (lovely do on a reasonable budget, and no added debt because of it!) and paid off a loan I took out to buy a car three years ago I've now got some free income to throw at my cards. Still, all those 0% balance transfer cards are only any good while you can tart on them, and the interest rate on one of them has gone up to 18.9%! In total I think I have 5 credit related products I'm using nearly all of (which is why I think I'm struggling to get approved for a loan), and a single consolidation loan would allow me to reduce that number to 3 (replacing three cards with one loan) and still keep things manageable

EDIT: Just to say, I've never gone over my limit (aside from one brief excursion on my overdraft while I was stretched a bit before the wedding), but I would like to reduce the amount of interest I'm paying overall

bouncydog1

Post up a full statement of affairs on the debt free board - there is a sticky at the top. You will need to get bank statements out so that you can put down accurately what your income and outgoings are. You also need all of the interest rates and you will be helped with where to cut back, and also be shown in what order to pay your debts off in order to save interest.

Oh, and credit scores are meaningless by the way - every lender uses a different methodology to decide whether to lend or not so if you are paying for a report, make a saving straight away and cancel it!

CLAPTON

how much do you owe in total
how much do you earn