Debt Consolidation the Answer??

DebtFreeDayDreamer_2

Hi All,

Can anyone advise on whether a debt consolidation loan would be a good option for me?

My current debt is;
£500 credit card @ 39.94% APR
£900 credit card @ 39.94% APR
£700 credit card @ 28.95% p.a (variable)
£307 payday loan @ 1,221.96% APR fixed

Ideally I'd like to squeeze all of the above into one place with loan repayments of approx £150 per month

Thanks in advance

[Deleted User]

It all depends.

CLAPTON

DebtFreeDayDreamer wrote: »

Hi All,

Can anyone advise on whether a debt consolidation loan would be a good option for me?

My current debt is;
£500 credit card @ 39.94% APR
£900 credit card @ 39.94% APR
£700 credit card @ 28.95% p.a (variable)
£307 payday loan @ 1,221.96% APR fixed

Ideally I'd like to squeeze all of the above into one place with loan repayments of approx £150 per month

Thanks in advance

what do your credit files say

what is your income

boo_star

With those interest rates you're already in sub-prime territory.

I doubt a high street lender would offer you a loan at all, nevermind one for consolidation.

That leaves you with people like Amigo, who are great if you get a decent interest rate and like losing friends/relationships with family members.

Probably better to avoid it.

jonesMUFCforever

On the face of it you have high APR debts and a payday loan so who do you think will offer you a decent loan rate?...because if you could have got a decent rate loan you would have done it already?

Pop over to the debt free board for budgeting and snowballing advice.

SeduLOUs

There's a small chance Capital One will give you a balance transfer card, but whether the limit is big enough to make a dent I don't know. Chances increased if one of the cards you already have a Cap One, and when the BT is over you can consolidate the two cards together.

I very much doubt anyone would offer you a consolidation loan based on the fact your cards all seem to be the 'repair/build credit' types.

Best bet is to go to debt free board, post a statement of affairs, and get advice on there on how you can cut back on your spending to make headway into these numbers - you don't have crippling amounts of debt, so on the assumption you have a job you should be able to do something useful.

Income board might be worth a look for ideas on some quick fix earnings? I had a tight Xmas once and discovered it's the ideal time of year to do Avon for a few months to make a few quid - but you may be a bit late for the Xmas crowd.

Good luck!

Thrugelmir

DebtFreeDayDreamer wrote: »

Can anyone advise on whether a debt consolidation loan would be a good option for me?

Statistically they don't work. As they provide an answer but not a solution to the issue. Hard graft is a better process for most people while learning to budget their money better.

ratrace

Can you borrow money from friends and family to pay of all the debts and repay them back over time you will save lots in interest thats what i would do even if its 5 people £500 each

jonesMUFCforever

ratrace wrote: »

Can you borrow money from friends and family to pay of all the debts and repay them back over time you will save lots in interest thats what i would do even if its 5 people £500 each

Wow that is some post!
I would never ever lend money to friends or family - it always ends in tears.
I would help in other ways such as help them budget and tell them where to get professional help such as CAB etc.

PeacefulWaters

DebtFreeDayDreamer wrote: »

Hi All,

Can anyone advise on whether a debt consolidation loan would be a good option for me?

My current debt is;
£500 credit card @ 39.94% APR
£900 credit card @ 39.94% APR
£700 credit card @ 28.95% p.a (variable)
£307 payday loan @ 1,221.96% APR fixed

Ideally I'd like to squeeze all of the above into one place with loan repayments of approx £150 per month

Thanks in advance

For starters, get that payday loan cleared.

Stop spending money on non-essentials.

Do not take out any further credit of any sort.

Cut up all three credit cards.

Pay the minimum payment plus £1 on all three credit cards.

Then repay the difference between this and £150 to the first card listed. Repeat until the balance is nil. Then start on the second card. When that's cleared, the third card.

PHYTHIAN

Agree with Peacefulwaters here.....cut the cards up.

My prediction for your future is payday loan after payday loan and within, I'd say, a year or so, you're going to be in a mountain of debt and having serious trouble paying them.....unless you act NOW!!!! Although I don't know your salary or outgoings, the amount of debt you have is fairly low at the moment so maybe post an SOA and get working on it.

Getting a loan to pay off a loan is NOT getting yourself debtfree....cutting back on luxuries and overpaying the minimum amounts is how you do it. How do i know this ??....personal experience!!!