Only paying off monthly interest and getting nowhere!!

ash75

I have accumulated in excess of £15k in credit card debt and would love to consolidate it in to 1 manageable monthly payment but I'm unable to as I will not be considered for a loan. This is due to a poor credit scoring even though I have proved to my bank my earnings, which they can obviously see hitting my account monthly.

I feel as though I will never ever pay this debt off and I'm just throwing £300 plus down a black whole each month.

Has anyone else been in this situation and can advise on what step(s) I could take as it's soul destroying.

PS. An IVA or Bankruptcy is not a road I want to go down as will be applying for a Mortgage in the near future.

I can afford the minimum payments but want the debt amount to reduce!!

comeandgo

How are you able to apply for a mortgage when you cant pay off the debt you already have?
Can you afford to pay more than the miminum payments on your cards. What is the interest rate of all the cards you have?

CLAPTON

how much do you earn ?

how much have you saved for the deposit ?

NPHammer

If your credit rating is good enough I would recommend transferring as much of the debt as you can to a long (24 - 27 months) 0% balance transfer card(s). It will save you a fortune in interest and your £300 a month will start making a dent into the debt.

If you are unsuccessful in your applications for 0% cards you can be sure you have very little chance of getting a loan or a mortgage from anywhere at anything like a reasonable rate.

lynz68

You will need to reduce this dramatically before applying for a mortgage. You need to look at what you are spending your money on and reduce your overheads as much as possible and throw every spare penny at the debt. If you go and ask on the debt free wannabe board you will get some great advice.

Could you use any money you may have saved for house deposit to pay this off instead and put your house purchase on hold while you save and improve your credit rating which can only help in getting a better mortgage deal.

allybee101

I have an overdraft that was around the £2800 mark when I applied for my mortgage. It limited the number of lenders who would accept me. I'm working on paying off the overdraft.
First - cut up the cards - don't spend any more on them.

Try and pay over the minimum payments, even if it's just an extra fiver here and there. It will start to chip away at the debt, albeit slowly. It will take time, but there are things you can do to speed it up.

Have a look at your income and outgoings and see if you can Cut Back or Make More Money anywhere.
There are budget planners/statements of affairs on here that you can download and fill in. Post the results on here and the friendly MSE'ers will help you work out where there is spare cash to throw at your debts.
Get a second job, sell your unwanted stuff on Ebay, work overtime, use cashback sites.

Good luck with it.

Angry_Bear

As lynz68 says above, your best bet would be the Debt Free Wannabe areas of the forums. But to get you started:

1. Fill in an SOA, be as accurate and honest as possible. This will allow you to see where you can reduce costs and how much you really do have available to throw at your debt (http://www.makesenseofcards.com/soacalc.html)
2. Play with this snowball calculator. It will show you how much time and money you could save just by prioritising your debts "properly" and paying just a little extra every month. It's a great motivational tool : http://www.whatsthecost.co.uk/snowball.aspx

YorkshireBoy

Angry_Bear wrote: »

Fill in an SOA, be as accurate and honest as possible. This will allow you to see where you can reduce costs and how much you really do have available to throw at your debt (http://www.makesenseofcards.com/soacalc.html)

That link no longer works. Here's the correct one...

http://www.stoozing.com/calculator/soa.php

Cycrow

if you cant afford any more than the minimum payments, then you clearly dont have any extra money to cover the cost of a loan

izools

ash75 wrote: »

PS. An IVA or Bankruptcy is not a road I want to go down as will be applying for a Mortgage in the near future

If your current level of income, expenditure, and debt is such that you are barely paying more than the interest each month, you won't get a mortgage. At least, you won't get one for more than 50p.

End of.

You need to walk before you can run that is to say clear down your debt before you look at any other form of credit product. If you genuinely can't afford more than what you're paying now no matter how many cutbacks you make, you should post on the Debt Free Wannabee board for further advice.

From the sounds of things you'd benefit from entering a DMP, or assuming you have a deposit saved up for this mortgage you're supposed to be applying for put that towards your debt and rethink your finances

StuC75

Pay more than the minimum payment then..

as it stands at the moment you are very unlikely to get a mortgage. Afterall where is your deposit?.

You need to do full SOA \ list income & Spending and see what can be cut out to allow the unsecured debt to be dealt with..

All that a lender is going to see is sweeping 15k from cards to loan - with the scope to run that debt back up again..