Consolidate 3 cards & loan?

mark65879

Hi,


I have 3 credit cards and a loan;


Card 1: £4000 of £6000 limit (APR 16.9%)
Card 2: £2000 of £2000 limit (APR 16.9%)
Card 3: £500 of £2000 limit (APR 16.9%)
Loan: £6000 (APR 5%)


I recently called the Card 2 company asking for a higher limit (as it had a 0% BT promo and I wanted to move the others to it) but they couldn't raise it so I'm *assuming* I wont be able to get a new card with high enough limit to take the 3 cards (?).


What's my best route to cut the interest I'm currently paying?


Thanks in advance...

forgotmyname

Either pull all the stops to get rid of the £500 you owe then work on the £2000 one.

Or work hard to get the £2000 one down.

Depends how a lender rates you. Will it be better to have 2 cards even though ones close to its limit. Or 3 smaller CC debts?

They may just look at the overall figure? In which case you just need to work hard and reduce what you owe.

[Deleted User]

If you can't get new credit, then your best best is to throw as much as you can at the cards.

CLAPTON

and you income is?

YorkshireBoy

Card 2 almost certainly declined your limit increase request because you are maxed out on your current borrowings with them.


It doesn't necessarily follow that other lenders would reject an application for a new card. However, I'd try and shift some of the card 2 debt to card 3 (even at 16.9% APR) first, so they don't see your maxed out state on card 2.


You seem to be concentrating on the interest charged, rather than clearing the debt down using other methods such as earning more or spending less. I'm guessing (because you haven't said what your income is) you're financially stretched at the moment, and that you're currently still spending on the cards, particularly the one that's maxed out?

longtermplanner

mark65879 wrote: »

Hi,
What's my best route to cut the interest I'm currently paying?

I would suggest that you forget about the loan as you aren't going to be able to get all your debts onto 0%, so concentrate on the high interest credit cards.

Have you checked your credit record to see if there are any problems on it? If there are, then you probably won't get any 0% offers in the near future whatever you do.

If your credit record is good, then you just need to pay some off so that your overall borrowing is lower as that will make it easier to refinance the rest at a lower interest rate. I would aim to clear card 3 as fast as possible, then phone up and ask to close it unless they can offer you a 0% deal. If they say no, close the card, wait a month and then apply for another 0% deal somewhere else.

But have you stopped spending on the cards? That is the vital first step. If you can't afford to do this, then you have a rather different sort of problem as you are getting deeper into debt each month. In this case have a long hard look at what you spend money on and find ways to reduce it. Or earn more. If opting for a tough, boring year now will make a difference, then you should do it. If you feel your situation is worse than this, then you need good debt advice, call Stepchange http://www.stepchange.org/Howwecanhelpyou/DMPDebtmanagementplan.aspx

Thrugelmir

What's my best route to cut the interest I'm currently paying?

Spend less. You need to break the cycle of dependency.

If it's unmanagable. Then seek advice from the National Debt Helpline.

mark65879

<p>Income is around £30,000. We're managing to pay around £450 a month to the cards and loan at the moment. Unfortunately alot of things have come up lately that meant we had to spend out.</p><p> </p><p>I assume I can just transfer from the £500 card onto card 1? Then get it closed would be the safest route. </p>

CLAPTON

mark65879 wrote: »

<p>Income is around £30,000. We're managing to pay around £450 a month to the cards and loan at the moment. Unfortunately alot of things have come up lately that meant we had to spend out.</p><p> </p><p>I assume I can just transfer from the £500 card onto card 1? Then get it closed would be the safest route. </p>

you have debts of 16,500 on a salary of 30,000 which is very high ratio


closing the third card will probably be a negative rather than a plus as it increases your available credit usage


basically your APRs aren't too bad but just try for a 0%BT card and see what happens: accept anything you are given as every little helps

mark65879

well i've done it! I've just cut up all of the cards! including the wife's!!!

so no more spending!

I've transferred card 3 onto card 1 (BT offer of only having to pay 6.9% until it's paid off) - although I'm aware it would've probably been better to transfer Card 2 onto card 1 now but hey ho! (hindsight eh?!!!)

am no working hard at paying back as much as i can as quickly as i can.

i have a question regarding the 'only pay 6.9% on BT until it's paid off' - when I make payments how do i know if it's paying off the BT amount or some other amount on the card?

Tixy

i have a question regarding the 'only pay 6.9% on BT until it's paid off' - when I make payments how do i know if it's paying off the BT amount or some other amount on the card?

Your repayments pay of the highest interest debt first. So any payments you make will pay off the debt at 16.9% APR before the debt at 6.9% AR.