Newbie and need advice please.......

Pepperstark

Hello,
Ive just been gifted 15,000.00....my debts are
About 18 grand as ive got my credit file but i only got experian.
Im paying off a credit union debt which was a huge help to me last year when i split up with hubbie meaning im 380.00 per month better off per month in my wage. I owe 11,500.00.
Once ive paid that ill have 3500.00 left from the 15 grand.
I dont know if im doing this right.
My barclaycard is 4,000.00
Cap one is 700.00
I owe my mum 1,000.00.

Am i right to pay the 3500.00 off my credit card..... Pay as much as i can off the remaining balance of 500.00 or pro rata the 380.00 that ill have spare? I get the money in about 3 weeks.
In my head ill have 500.00 barclaycard
700.00 cap one
My mum 1,000.00.

Basically i need to clear my debts as quickly as possible hitting the highest interest. Will clearing my debts raise my credit rating too.
Financial advisor told me NOT to lower the credit card bal with the company and keep it at 4,000.00 in credit once ive paid the 3,500.00 he said its good to show ive paid it and keep the card and to drop the bal which i am and pay it off as this increases credit rating if that makes sense. As all this is to change my mortgage as ive been declined about 12 months ago and this is what ive been trying to do by paying everything!

I haven't got the card anymore i cut it up so i wouldn't use it!!!!

Am i right in what im thinking!!im just very very lucky to be given 15 grand! Any advise is appreciated.

grumbler

Pepperstark wrote: »

...
Ive just been gifted 15,000.00....my debts are
About 18 grand as ive got my credit file but i only got experian.
Im paying off a credit union debt which was a huge help to me last year when i split up with hubbie meaning im 380.00 per month better off per month in my wage. I owe 11,500.00.
Once ive paid that ill have 3500.00 left from the 15 grand.
I dont know if im doing this right.
My barclaycard is 4,000.00
Cap one is 700.00
I owe my mum 1,000.00.

Am i right to pay the 3500.00 off my credit card..... Pay as much as i can off the remaining balance of 500.00 or pro rata the 380.00 that ill have spare? I get the money in about 3 weeks.
In my head ill have 500.00 barclaycard
700.00 cap one
My mum 1,000.00.

Basically i need to clear my debts as quickly as possible hitting the highest interest.

Correct. Why is it the credit union loan then that you want to pay first? I think it's unlikely to be the most expensive one.

Will clearing my debts raise my credit rating too.
Financial advisor told me NOT to lower the credit card bal with the company and keep it at 4,000.00 in credit once ive paid the 3,500.00 he said its good to show ive paid it and keep the card and to drop the bal which i am and pay it off as this increases credit rating if that makes sense.

Not much unless you meant the limit, not the balance.

Any advise is appreciated.

Advice.

Fruit_and_Nut_Case

grumbler wrote: »

Advice.

(Although in all fairness the OP did get it right in the thread title.)

dresdendave

The usual way to pay off your debts would be to list them in order of APR and then pay off the highest first and work your way down the list, making sure you have enough left to pay at least the minimum payments on any you can't clear in full.


Well done for using your windfall to straighten out your finances rather than blowing it on a holiday, new car or suchlike.

enthusiasticsaver

When paying off debt you should prioritise the one charging the highest rate first which is likely to be the credit cards not the credit union. Similarly with your mum, is she happy to wait or does she need paying off quickly? Are you able to partially pay off the credit union payment? Unless your credit cards are on 0% I would pay those off first then the credit union and your mum. I would also keep £1000 back as an emergency fund so you are not tempted to go back to using credit cards.

Piggy10

I personally have both a Capital one and Barclay Card , the APR interest is pretty high with Capital one (It is with me anyway)so you may be better off getting rid of that first , at least it's one thing less to worry about! You'll still have plenty left to put a dent in your Barclay Card but as dresdendave advised make sure you've got enough money left to keep up minimum payments etc so you dont end up falling short!

Best Wishes!