I need to help my mum!

hereistheguy

Hello everyone, im looking for some advice.

Im 18 and going to uni in september and my parents are divorced, therefore leaving my mum on her onw, which isnt a particular problem.
However, recently i've been trying to help her with her debt and I just want to get it sorted before I leave.
My dad left her with 2 cards (barclaycard) in her name, which he used for businesses, when they got divorced. She's been paying £50/£55 a month off each however one of them is £30 interest a month (the other one isn't too bad).
She's also got her own credit card which is around £10,000 (she's had to use it a lot becuase my dad doesnt pay anything for maintenance etc.) and she pays £200 a month off that, £170 of which is interest!!!
So, in total she's in about £14,000 of debt.
We decided the best solution would be a consolidation loan over 5 years (she retired in 4 years) for £14,500. However she's been turned down for them. Although her credit score is good, I think it's becuase she only earns £12,000.

I just don't know what to do now to help her. If she continues paying what she does now it's going to take AGES to clear her debt. Credit cards (0%) dont give her a high enough limit to clear one card.
She can afford to pay about £300 a month off her debts.

Thanks for any suggestions!

OliveOyl_2

For immediate first aid, whilst a cheaper solution is found, I'm told that contacting the credit card company, asking what the APR is and objecting to the rate can bring an immediate reduction. They would rather keep you owing them than lose your debt to someone cheaper, but you have to give the impression that you WILL move the debt if they don't improve their rate.

good luck!

Storm

Hi and welcome :hello:

Firstly - good on you, trying to help your mum get sorted, plenty of people wouldn't bother!

Secondly - we need a bit more information before we can give solid advice - have a look at SouthernScousers sticky for new posters & see if you & your mum can pull together a SoA.

The loan might have been turned down because your mum is looking to retire in 4 years, though it is a large loan considering her salary.

One thing she might be able to do though - if you're going to another town for uni could she rent out your room to a student coming to yours? Offering term time only will be very popular with students who don't want to pay rent all through the year and could bring in a couple of hundred a month (depending on your area & what the going rate is)

hereistheguy

We have tried the whole phoning up thing but they said they couldnt change it (even though they're from the same company) becuase it was a special random selection thing...

Here's my mum's SOA:

Barclaycard Visa £2105.50 9.9%APR
Barclaycard Mastercard £1982.09 (Not sure which APR... 19.9 [purchase anual rate] and 27.9 [cash annual rate] but interest in £30.27)

*Important to note with these two is that mum doesn't have the cards anymore, she's clearing them and cannot spend at all*

MBNA £10294.47 I think the APR is 1.64%? :S (Its not printed but its an MBNA gold Visa. Interest last month on 10325.25 was 169.22

Would it be worth transferring the blanaces to the MBNA card?

RAS

hereistheguy wrote: »

We have tried the whole phoning up thing but they said they couldnt change it (even though they're from the same company) becuase it was a special random selection thing...

Here's my mum's SOA:

Barclaycard Visa £2105.50 9.9%APR - what is the limit on this?
Barclaycard Mastercard £1982.09 (Not sure which APR... 19.9 [purchase anual rate] and 27.9 [cash annual rate] but interest in £30.27) what is the limit on this

*Important to note with these two is that mum doesn't have the cards anymore, she's clearing them and cannot spend at all*

MBNA £10294.47 I think the APR is 1.64%? :S (Its not printed but its an MBNA gold Visa. Interest last month on 10325.25 was 169.22

Would it be worth transferring the blanaces to the MBNA card? NO - she is paying 1.64% per month. Please check up what the ANNUAL APR is - it will be horrid.

You need to ask her to do a full SOA

see here http://forums.moneysavingexpert.com/showthread.html?t=107280

IS she getting single persons allowanc on her council tax, WTC, CTB etc.

it all matters.

OliveOyl_2

The MBNA is charging you 1.64 per month that equates to around 20% per year :eek: That is not cheap :eek:

RAS

hereistheguy wrote: »

Barclaycard Visa £2105.50 9.9%APR - she pays the absolute minimum off this one
Barclaycard Mastercard £1982.09 (Not sure which APR... 19.9 [purchase anual rate] and 27.9 [cash annual rate] but interest in £30.27) Does she have any cash on this?

MBNA £10294.47 I think the APR is 1.64%? :S (Its not printed but its an MBNA gold Visa. Interest last month on 10325.25 was 169.22 - she stops all spending on this one

quote]

hereistheguy

Monthly Incomings:

My salary - £900 - £1,100
Benefits - £14 (When i got to uni £170 is being taken away)

Total - £1,114 MAX
(Mum can do overtime sometimes but she's an untrained nurse so its physically hard work for her becuase she usually does 12.5 hour days. She's contracted for 30 hours)

Monthly Outgoings:

Mortgage/Rent - £0 (dad pays that)
Council Tax - £74
Gas - £14
Electric - £50
TV License - £30
Phone - £22
Food - £50
Car Insurance - £17
Petrol - £40
Piano Hire £27
Club (Littlewoods catalogue) £50
Gym £22
Car Loan £108
Barclaycard Visa £2105.50 9.9%APR
Barclaycard Mastercard £1982.09 (Not sure which APR... 19.9 [purchase anual rate] and 27.9 [cash annual rate] but interest in £30.27)
*Important to note with these two is that mum doesn't have the cards anymore, she's clearing them and cannot spend at all - there is NO limit available*

MBNA £10294.47 I think the APR is 20%ish (Cant find the exact figure ANWHERE and they're closed atm so will try on monday or something)

Total: £809

Plus Food shopping and other things add up, and mum likes to have £200 left in case she doesn't get paid as much the next month.

Hope this is all ok Thanks so much for your help guys.

margaretclare

No, no, no - do not do consolidation! These things are marketed on daytime TV as an easy solution - affordable payments over a long period of time, secured on your home. Not a good idea! She will end up paying more, in fact she'd probably never be free of the darned thing.

Good on you for trying to help, a bloke like your Dad who leaves her with credit card debts and no income is a complete !!!!!!, IMHO.

Margaret

RAS

hereistheguy wrote: »

Monthly Incomings:

My salary - £900 - £1,100
Benefits - £14 (When i got to uni £170 is being taken away) can you explain

Total - £1,114 MAX
(Mum can do overtime sometimes but she's an untrained nurse so its physically hard work for her becuase she usually does 12.5 hour days. She's contracted for 30 hours) What is her rate per hour?

She needs to work more hours but maybe it woulkd be better if she did another type of work instead?

Monthly Outgoings:

Mortgage/Rent - £0 (dad pays that) - how many rooms?
Council Tax - £74 - does she get single person rebate?
Gas - £14
Electric - £50 - this is high. Get energy (money) saving lamps in the maion rooms, turn off all the things on stand by, then turn off the lights when she is not on the room. Check suppliers and swap via Quidco
TV License - £30 - why is this so high - (£11 per month)
Phone - £22 - is this a land line? read Martin's article on phones to get free evening and weekend calls
Food - £50 - OK
Car Insurance - £17 - check and swap via quidco if possible
Petrol - £40
Piano Hire £27 - get rid off this. If she wants a piano, join freecycle.org and get one for free.
Club (Littlewoods catalogue) £50 - is this per month!!!! or her current debt? Stop using this now. Join freecycle and get second hand clothes.
Gym £22 - cancel this. She cannot afford it

Car Loan £108 - this is a debt. APR? Value? When does it end?
Barclaycard Visa £2105.50 9.9%APR pay minimum only
Barclaycard Mastercard £1982.09 (Not sure which APR... 19.9 [purchase anual rate] and 27.9 [cash annual rate] but interest in £30.27) casH?
*Important to note with these two is that mum doesn't have the cards anymore, she's clearing them and cannot spend at all - there is NO limit available*

MBNA £10294.47 I think the APR is 20%ish (Cant find the exact figure ANWHERE and they're closed atm so will try on monday or something)

Total: £809

Plus Food shopping and other things add up, and mum likes to have £200 left in case she doesn't get paid as much the next month. She has not got £200

Hope this is all ok .

Well done.

Question is, does she want to make the changes?

hereistheguy

Ooo sorry the debt consolidation would be an unsecured personal loan, but she cant get it so seems like thats out the window. It would have been ideal becuase she could pay it over 5 years, and pay something like £280 a month. But oh well.

To RAS:

The £170 is child benefit and working tax credit she gets atm, however in september this will all stop becuase i will be 19, and im going to uni.
Mum gets £7.70ph and saturday and sunday are paid unsocial hours (with each day being different)
Mum loves her job, she's been a nurse for 25 years and has a really good contract with the NHS (she's on an old contract which gives her better benefits). I've suggested moving to a clinic working 9-5 mon-fri but she said she'd be bored and doesnt want to train to a higher grade nurse becuase she retires in 3 years. Plus finding funds for that etc. would be a waste.
The house has 2 bedrooms (used to have 3 but extended mums room by combining 2 of them). She gets the single person rebate. We have lots of energy light bulbs in all the lights we can have, but it will go down loads when I leave becuase its all my technology etc that uses it up :S
Yes the phone's landline, I think we are going to try and sort the phone sit out to get a better deal.
The piano is nearly paid for, its for me, my parents have paid for it for like 3 years or somehting then mum took it on.
Club was for a table or something, its intrest free. Will ask about the gym thing.
The barclaycards are only being paid their minimum.