Which way to tackle my debt?

chrishell76

Hi all

Not a massive debt, but at the same time I seem to be getting deeper more recently, so am looking at clearing the slate, not sure what route to take. I have currently £4000 credit card which is maxed out, this is a 0% job which I moved my high interest loan to, along with some other purchases. I also have found that this month I have for the first time in a long while am close to maxing out my £1000 overdraft.

I currently have my own place with a £47000 mortgage which is a low £200 per month. The other main outgoings are £200 to my son, x random amount to pay my credit card, and £150-£200 in diesel for mainly travel to and from work. Then there is around £150 in energy bills.

Do I get a loan for £5k or do a loan against my property through my mortgage, as I do have £17k equity in the property, I have already enquired about this and they have said that the account will run along my mortgage and I can make over payments without penalties, this combined with it only costing £30-£50 extra a month, would make it affordable.

Any advice on which way to go?

Thanks

ellesbellesxxx

The route you take depends on how you got the debt - whether it be that you have had to take credit to get by, in which case you need to see what help you are entitled to, or if there is anything to cut back on.
Often people find filling in a Statement of Affairs helps (SOA), to share for advice or just to look at the areas where costs are escalating.

Have you gone down the ebay/etc selling route/surveys etc to make some extra to help out?

Good luck!

Tixy

Hi and welcome

If your debts have been increasing then the best starting point is to draw up a list of income v outgoings to see how much more you are spending than you have coming in each month - known as a statement of affairs. We use this calculator http://www.makesenseofcards.com/soacalchelp.html which helps you identify all the areas you are spending money - and also lists you debts and minimum payments each month.

Once that is completed it should help you see how big an issue you have currently. If you also post the statement of affairs on here people can help suggest ways you can make your budget balance and save money to free up more to pay off your debts each month, as well as the best way to tackle your debts.

chrishell76

Well like I said I would say that a large part of my credit card is from my car, which is worth around the £3k mark. And would say that the last month has been a blip due to Xmas, had some car repairs which are not usual occurrences.

I will have a look at the budget and post back.

Thanks

Lucy1010

Hi there

In my opinion getting a loan or adding to your mortgage won't help you in the long run.... you are more than likely to create new debt if the credit is available to you on your existing card. It's too tempting :-)

Justt speaking from experience

Lucy

chrishell76

Lucy1010 wrote: »

Hi there

In my opinion getting a loan or adding to your mortgage won't help you in the long run.... you are more than likely to create new debt if the credit is available to you on your existing card. It's too tempting :-)

Justt speaking from experience

Lucy

Well if I paid off I would cancel the card. I do not usually spend unless I have the money, so I just think its been a freaky month.

Lucy1010

chrishell76 wrote: »

Well if I paid off I would cancel the card. I do not usually spend unless I have the money, so I just think its been a freaky month.

Great, I wish I had that same attitude before I got into my mountain of debt

Mozette

chrishell76 wrote: »

Well like I said I would say that a large part of my credit card is from my car, which is worth around the £3k mark. And would say that the last month has been a blip due to Xmas, had some car repairs which are not usual occurrences.

I will have a look at the budget and post back.

Thanks

xmas does occur every 25th of december, and cars do periodically need repair. I'm not being sarcastic, but these are things you need to budget for, because they do happen.

patman99

Does your son really need £200 a month ?.

chrishell76

patman99 wrote: »

Does your son really need £200 a month ?.

Well that's what I pay for my sons maintenance, looked at the CSA website for a guide and I am about right really, so I think so.

chrishell76

Mozette wrote: »

xmas does occur every 25th of december, and cars do periodically need repair. I'm not being sarcastic, but these are things you need to budget for, because they do happen.

Yes I understand that and in theory that should be easy and avoid getting into debt, but the amount I have gone through in December is a first for me and at the end of the day money only goes so far and I do generally find it hard to save also.