Offering Xp in the £ on CC that isn't bad debt

jammy_basturd

I have a couple of BT credit cards that are mostly at their limits and I've been paying the minimum for a while.

Due to a set of unfortunate and unforeseen circumstances I can't get any other credit cards to move this debt on to and I'm now paying quite high interest rates on the balances, so paying min. payments every month isn't really clearing the balance at any exciting rate.

I've been able to pay on time every month so far, apart from last month when I missed the payment on one of the cards by a few weeks. I've had a look on Noodle and this doesn't seem to have affected my rating (yet).

Anyway, my question is, does any one know of any one who has successfully offered Xp in the £ on a credit card when the account probably isn't classified as a bad debt (but maybe just high risk)?

[Deleted User]

No. You will need to default on the account before they will entertain an offer. So a few months of pain.

jammy_basturd

Hmmm, I'm in the incredibly frustrating position of not having a brilliant credit rating due to the amount of credit I have open, but not terrible because I've not defaulted.

But until it's terrible it seems I'll be paying this lot off for quite a few years yet as I'm still just about living within my means.

grumbler

What's "Xp"?
If you mean the settlement amount smaller than the current balance, then if you can pay a lump sum then you surely cam keep making monthly payments for a long time ahead. Why would they want to accept/offer this? After a while you'll pay them a lot of interest and still owe abut the same amount.

jammy_basturd

I have received about 80% of one of the cards balances as a windfall. Now this has become a much needed 'oh !!!!' fund should I need some emergency money (instead of using CCs which I've had to do so far).

I'm willing to use a reasonable amount of this money to try and clear one of the credit cards, but don't want to use half this money and only reduce my monthly payments by £30.

But I agree, there isn't really any incentive for either of the credit card companies to agree to a settlement all the while I'm managing to pay the minimum.

CLAPTON

jammy_basturd wrote: »

I have received about 80% of one of the cards balances as a windfall. Now this has become a much needed 'oh !!!!' fund should I need some emergency money (instead of using CCs which I've had to do so far).

I'm willing to use a reasonable amount of this money to try and clear one of the credit cards, but don't want to use half this money and only reduce my monthly payments by £30.

But I agree, there isn't really any incentive for either of the credit card companies to agree to a settlement all the while I'm managing to pay the minimum.

makes no sense to have an emergency fund earning (say) 1.5% whilst continuing to pay debts at (say) 25%.

best to use the money to pay down the debt with the highest APR

maybe once your debt declines in relation to earning and available credit, you may be able to get some 0% BT deals.

Hooloovoo

grumbler wrote: »

What's "Xp"?

Took me a while to work out what the hell he was going on about, too.

He means the algebraic "x pence".

i.e. he would like to offer "x pence in the pound for each pound owed" where x is some value less than 100.

jammy_basturd

I fully understand what you're saying.

However over the past year or two I've several times had to spend on my credit cards due to unexpected bills coming in, which then puts the balances back at their limits and reverses any hard work I'd been putting in to paying them off.

I know my credit rating is bad only because of the amount of credit I've got open, so you're right in saying the best approach would be to pay off a lump sum and decrease the credit limit, which then eventually might open up some more options for new 0% BT deals.

However to do so would leave me, for a period of time until such deals became available, in a situation where I didn't have a cash safety net (and my car is getting very old and tired) and I had no credit available either.

I guess I'll just have to do a bit of half and half, but I was hoping there was a way to really maximise this money I've got. Equally annoying when you hear about so many people getting 40%+ wiped off their debts in settlements just because they've been on a payment plan for a few months.

Hooloovoo

jammy_basturd wrote: »

However over the past year or two I've several times had to spend on my credit cards due to unexpected bills coming in, which then puts the balances back at their limits and reverses any hard work I'd been putting in to paying them off.

I bet if you are truly honest with yourself, the bills weren't unexpected.

There aren't many bills that are completely unexpected.

For example, the boiler or car breaking down are unwanted expenses, but are far from unexpected.

jammy_basturd

Well, they're unexpected in that you don't know when they're going to happen, but I also agree that you can set money aside to pay for them when they do (as long as you have the disposal income).

grumbler

Most unexpected bills can be paid by a CC. Even if you have to withdraw cash this is likely to be less expensive than keeping cash and paying high interest on the CC balance for months.