Catriona's Credit Card Countdown

catriona79

Ooh I've just seen something that really cheered me up!
As I was trying out the On Trees app (it lets you see all your bank and credit balances in one go), I logged in to my black horse CC account, to remind myself of the password. And what was there waiting for me? A balance transfer offer for 12 months 0% with a 3% fee. That's definitely worth pursuing when the time comes! I've got a 6k credit limit with them, and current balance is £1700, but that needs to be cleared by mid Feb 2014. And it will be.
Hmmmmm that changes the game! Need to go off and ponder a new strategy!

catriona79

I had a meeting with my mortgage advisor at the bank today and came away with an alternative to this slog. It doesn't even look that costly.

If I were to borrow £10k as a homeowner loan (a small tracker mortgage), that would be at the rate of 3.69%. Paid over 5 years, that would be £183 a month. The interest would be £967 over 5 years, so about £200 per annum.

If I overpaid regularly by, say, £300, then that would reduce the term of the loan to 1yr and 10 months and the total interest would be £349.

Now, I'm thinking its not such a bad deal.
1. financially... If I were to keep switching 0% cards, then I'd have to pay around 3% anyway, and I don't get the super-long deals anymore, and end up paying the BT fee and only get a 0% deal for 12 months.
2. Credit rating wise. I have recently been refused a Halifax card. Maybe I could try for the virgin card for 27 months, but what are the chances that I get it? Also, it impacts my credit rating, due to the amount of unsecured debt and refused applications.
3. Psychologically - the stress is huge. I find myself thinking too much about my debt. I waste about a couple of hours each day thinking about it.

Maybe, with the Tesco card which has no transfer fees, a new trend has been started and more banks will start offering these deals. But who knows...

I think it would be so much better to be able to finally live a little and not spend my life thinking about debt. Otherwise I will look back on my 30s and regret not having had fun.
I could build up a buffer of savings and feel more secure. I wouldn't even need to overpay in months where I wanted to go on holiday. And even if I didn't overpay most months, that's wouldn't be so much of a problem.

If it was at a huge price, then maybe I'd keep putting all this pressure on myself, but there is not that much in it, really.

Off to do some sums...

beanielou

I think the big question is have you addressed the issues that got you into debt.
Will you close all the CC's down?

karmachilovething

I agree with Beanielou: if this is a more efficient way to pay off your debts and you don't run up more debt elsewhere then great. If it's mostly for the psychological benefit and you haven't learnt live within your means I'd be weary.

I say this because I did a similar thing: I got everything (including overdraft) onto a 0% card, and then fell off the wagon, basically doubled my debt before I came back here with my tail between my legs! I would hate to see you make the same mistake

karmachilovething

I'd also add that you're doing really well, and all of us have those low days when you just want rid of it and to get on with your life. I think about my debt a lot too. This evening I was standing at the beginning of my yoga class with it all over whelming me. But then I remembered that I've taken control, I can do this, and I will get there. You will get there too.

catriona79

beanielou wrote: »

I think the big question is have you addressed the issues that got you into debt.
Will you close all the CC's down?

Hi Lou

Thanks for the message and yr advice. I know what got me into debt - it was ploughing about 18k of my savings into the house while doing it up... It's not for nothing, I've made a bit of money when I look at today's prices, but the thing is that from a saver I became massively in debt...

Now, don't get me wrong... I have my flaws and expensive habits. I own a Chloe bag;) but I wouldn't get myself into debt over those things.

I think, psycholgically, I just can't wait to have a savings buffer. To stop constantly thinking of money. Stop looking at the spreadsheet!;)
I have made a good dent in the debt, but I keep wondering if its worth wasting these years of my life just to have a LTV of 60% and not 70 or 80%. I've still got a god chunk of money in the house, and if I had bought it done up already, I wouldn't have set myself this challenge to repay by 1k a month...

Obviously, it would be lovely to have this much equity, but i feel that there's more to life than that... I have been wondering if I'm wishing my life away... Oh, feeling pensive tonight...

Hope you're well, Lou?

catriona79

I would definitely close my cards down! Oh yes! Can't wait on see them gone on noddle!!!

catriona79

karmachilovething wrote: »

I agree with Beanielou: if this is a more efficient way to pay off your debts and you don't run up more debt elsewhere then great. If it's mostly for the psychological benefit and you haven't learnt live within your means I'd be weary.

I say this because I did a similar thing: I got everything (including overdraft) onto a 0% card, and then fell off the wagon, basically doubled my debt before I came back here with my tail between my legs! I would hate to see you make the same mistake

I know you have a point... I'm not amazingly good with money, compared to really thrifty people, but I'm not too bad either. In the 18 months leading up to buying the house I consistently saved money, anything from 500-700 on a 1550 monthly salary... And I lived with a friend who had v expensive habits and an ex husband who was paying the mortgage, her car lease, her gym membership etc... And I managed to stay away from trouble.

I cannot say I will definitely not get into debt... But I think I won't... Oh dear.... Ill have to have a good old think...


If i closed the credit accounts, and tried to live within my means, I could then see how I did. Maybe I could overpay and keep this challenge going... I think I'd want to see the debt gone too...ASAP!

catriona79

karmachilovething wrote: »

I'd also add that you're doing really well, and all of us have those low days when you just want rid of it and to get on with your life. I think about my debt a lot too. This evening I was standing at the beginning of my yoga class with it all over whelming me. But then I remembered that I've taken control, I can do this, and I will get there. You will get there too.

Thanks KC


The yoga class situation sounds familiar. You're right, it's about taking control.
Have you done your Meyers Briggs personality test? I am a J, so I can't stand unfinished business... Of any sort...

karmachilovething

Ha ha! I love a good personality test! I've done loads over the years.

Myers Briggs puts me as INTJ, but my P and J are marginal, so I'm not far off INTP, which is kind of a nonsense! I'm quite moderate in lots of ways, flexible and open to new ideas, which explains why I'm marginal on P/J