Pay ALL your debt off by Xmas 2015!

cutiepieabf

ok guys. i have had a provisional loan agreed with my bank. they are offering £6000, which would clear over 2/3rds of my credit card balance (which has been the bane of my life for the last 10 years!!). I could then look to get a 0% balance transfer for the remaining £2000. As long as the monthly payments for these dont exceed what i pay at the moment i think this could be a viable option. the loan would have to be for 60months i think but atleast it would then be paid, whereas now i am only paying minimum payments and so little of the balance is coming off each month
Any advice regarding this? do you think it's a good plan?
i wont have paid off my debts by xmas 2015, but they will be in far better control than they are at present!

Thanks for reading.

Mat_Lock

Impending large update...

Pablosammy

cutiepieabf wrote: »

ok guys. i have had a provisional loan agreed with my bank. they are offering £6000, which would clear over 2/3rds of my credit card balance (which has been the bane of my life for the last 10 years!!). I could then look to get a 0% balance transfer for the remaining £2000. As long as the monthly payments for these dont exceed what i pay at the moment i think this could be a viable option. the loan would have to be for 60months i think but atleast it would then be paid, whereas now i am only paying minimum payments and so little of the balance is coming off each month
Any advice regarding this? do you think it's a good plan?
i wont have paid off my debts by xmas 2015, but they will be in far better control than they are at present!

Thanks for reading.

Hard to say without knowing the interest rates on the CCs and the loans. If you're paying less interest, then go for it! The danger is the temptation to get into more CC debt once you've got the loan, make sure you close the CCs you've paid off.

Mat_Lock

So Monday is payday finally! yipppeeee! I've already had my payslip and have worked out all my outgoings/incomings.

I gained about £100 on travel expenses this week as I drove to Cardiff and back and only put £40 of petrol in my car and paid the £6.50 toll but I get £148 back hoping to get that back in my bank account as soon as possible.

I will pay off the last of the credit card debt £250 on MBNA and £40 on Tesco (from the petrol).

So with all the usual direct debits, standing orders etc I am officially left with £950 for the month of February to do with as I please.

Officially debt free from Monday !! WOOHOOOO !!

starnac

cutiepieabf wrote: »

ok guys. i have had a provisional loan agreed with my bank. they are offering £6000, which would clear over 2/3rds of my credit card balance (which has been the bane of my life for the last 10 years!!). I could then look to get a 0% balance transfer for the remaining £2000. As long as the monthly payments for these dont exceed what i pay at the moment i think this could be a viable option. the loan would have to be for 60months i think but atleast it would then be paid, whereas now i am only paying minimum payments and so little of the balance is coming off each month
Any advice regarding this? do you think it's a good plan?
i wont have paid off my debts by xmas 2015, but they will be in far better control than they are at present!

Thanks for reading.

Make sure that the interest rate would be less than you are paying now and do not spend on the cleared cards. That where most people get tripped up - they start spending again racking the debts back up even higher.

If the interest rate is better and you won't be tempted to re-spend then go for it

starnac

Mat_Lock wrote: »

So Monday is payday finally! yipppeeee! I've already had my payslip and have worked out all my outgoings/incomings.

I gained about £100 on travel expenses this week as I drove to Cardiff and back and only put £40 of petrol in my car and paid the £6.50 toll but I get £148 back hoping to get that back in my bank account as soon as possible.

I will pay off the last of the credit card debt £250 on MBNA and £40 on Tesco (from the petrol).

So with all the usual direct debits, standing orders etc I am officially left with £950 for the month of February to do with as I please.

Officially debt free from Monday !! WOOHOOOO !!

Wow congratulations. Bet you can't wait! Now time to make that £950 work for you

Mat_Lock

If only it was £950 straight to savings but I know I have to live, but I am hoping to throw at least half that in to savings.

need to get to £3k as quickly as possible as that will pay for all the fees when I get a mortgage.

cutiepieabf

starnac wrote: »

Make sure that the interest rate would be less than you are paying now and do not spend on the cleared cards. That where most people get tripped up - they start spending again racking the debts back up even higher.

If the interest rate is better and you won't be tempted to re-spend then go for it

Thank you for this advice.
The interest rate on the loan - i'm not sure i will have to check if it is better than the credit card, but at the moment i will never pay the ccard off because so little of what i pay comes off the balance - atleast with the loan it will be gone in 5 years..... or am i being dumb?

The 0% balance transfer ccard, they usually have 0% on balance transfers for 12-18 months, so doesnt that mean that i wont pay interest (as long as i dont purchase on it) for that length of time?

i get really confused with this stuff so your help is much appreciated! Thank you

starnac

cutiepieabf wrote: »

Thank you for this advice.
The interest rate on the loan - i'm not sure i will have to check if it is better than the credit card, but at the moment i will never pay the ccard off because so little of what i pay comes off the balance - atleast with the loan it will be gone in 5 years..... or am i being dumb?

The loan will probably be cheaper as cc have such high interest. And yes at least you know it'll be gone in 5 years if you keep up payments

The 0% balance transfer ccard, they usually have 0% on balance transfers for 12-18 months, so doesnt that mean that i wont pay interest (as long as i dont purchase on it) for that length of time?

Yes that's right. Although divide the amount by the length of the 0% period and aim to get it paid off in that time. That way you'll pay no interest (as long as you don't purchase on it)

i get really confused with this stuff so your help is much appreciated! Thank you

That's what these boards are for

cutiepieabf

i have checked the loan it is 26.9% APR so i would be paying back £8467 for borrowing £4900. My credit card - i cant find the APR only standard purchase of 20.780% and standard cash of 25.640%.
Does that seem a lot?