Need some help - Vanquis

scholesfan88

Hi all

This is my first post on the forum :T

I need a few things explaining or answering if possible please...

So i'm fairly young (low 20's) and i have previous defaults to my name from littlewoods and mobile phone companys from around 5 years ago, manage my finances alot better these days though.

I wanted a credit card to try and rebuild my credit rating and also for a couple of things for xmas.

However the only company that would touch me is Vanquis. They have given me a £500 limit with annual intrest of 39.9%.

So i'd like to know how i'd work out the monthly charges if i wasnt to pay the balance off in full each month?

I dont plan on goin near the credit limit, i need approx £200 to be spent on the card for xmas with the plan on paying this back in full in June when my car finance is paid off and i have an extra few £££ each month.

So £200 spent on 39.9% apr = what min repayment and what would be the interest out of the min repayment

Im just stumped as Vanquis wont tell me what the 'minimum' repayments would be until i've spent the money which is stupid.

Thanks all

MrSilk

Welcome to the forum!

Depends on the balance at the time the statement is produced.

If Vanquis can't tell you then I'm sure no one on here would be able to tell you I'm afraid!

The interest on the full £500 would be £199.50?

On £200 interest would be £79.80.

Not sure what the minimum payment would be either, could check the T&Cs

scholesfan88

Cheers

That's anually so the £79.80 would be divded by 12 to get the monthly fee?

Never had a credit card before so this is all new to me.

Thanks again.

MrSilk

That's correct

So on £500 it would work out at around £16.62 per month, or the balance of £200 would work out at £6.65 per month interest

My advice, try not to leave a balance of more than half of the limit, it will do more bad then good. Pay as much off each month as possible and you'll be fine!

pmartin86

As far as Im aware it would be the following calculation.

39.9% / 12 = 3.325% interest a month

3.325/100 * Outstanding Balance = Monthly interest fee.

so 3.325/100*200 = 6.65 Interest a month.

Most cards will have a minimum payment of the interest plus a percentage of the ramining balance (2.5% I think is standard) In which case you minimum payment would be £6.65 + 2.5% of 200 = £5 which would be £11.65.

Regards
Paul

YorkshireBoy

scholesfan88 wrote: »

So £200 spent on 39.9% apr = what min repayment and what would be the interest out of the min repayment

The minimum payment calculation options, and the monthly interest rate, are shown in your summary box, but lets assume the minimum payment is 5%...

Interest for a full month would be £200 x 2.84% = £5.68

Minimum payment would be £205.68 x 5% = £10.28

...so you'll be paying only a fiver off each month...for 6 months.

I'm sure you won't 'just' be making the minimum payment though, because that would be complete madness for a Christmas present!

MrSilk

To keep a rolling balance on a card with 39.9% would be mad, I daren't even keep a balance on card at 29.9% !

scholesfan88

Cheers guys.

No i dont plan on keeping the balance for very long. My car hp is finally up in June so i'll have an extra £300 a month to play with, plus i have bonuses paid to me from work in my February wage so it'll be paid off sharpish.

Just wanted to know what the interest would be a month until i clear it in full, thanks for your very clear cut answers!

Ive had the card 3 weeks and ive not even activated it yet due to this issue, there customer service is useless.

MrSilk

scholesfan88 wrote: »

Cheers guys.

No i dont plan on keeping the balance for very long. My car hp is finally up in June so i'll have an extra £300 a month to play with, plus i have bonuses paid to me from work in my February wage so it'll be paid off sharpish.

Just wanted to know what the interest would be a month until i clear it in full, thanks for your very clear cut answers!

Ive had the card 3 weeks and ive not even activated it yet due to this issue, there customer service is useless.

You're welcome!

Use it for 6 - 8 months and you should be able to move onto a better card with better interest rates :T:T

While lenders do take previous defaults into account when making credit applications, they are interested in your current financial position, not your financial position 5 years ago; so the older the defaults are, the less impact they have on your credit history. In 6 - 8 months, your defaults would or nearly have dropped off anyway.

YorkshireBoy

MrSilk wrote: »

Use it for 6 - 8 months and you should be able to move onto a better card with better interest rates :T:T

For the sake of a few extra months, probably best to wait for the defaults to drop off in a year or so?

EDIT: You modified your post whilst I was typing.

MrSilk

Depends which card the OP would like to apply for, e.g. the Barclaycard initial, which accepts applications from people with defaults and CCJ's (unless the CCJ was issued within the last 12 months). Although the interest is still quiet high at 29.9%, it's still better than vanquis.

http://www.barclaycard.co.uk/personal/credit-cards/initial