Advice?? Please

consnmattsmom

Me and my hubby have lots of little debts on cards and small loans that total £12100, thats besides a car loan and loan for his bike that we have. We are managing these debts just about and leaves us with approx £550 per month for food, petrol etc after all the debts and bills are paid.

At the rate we are going we estimate will be debt free by June 2010 (except car loan which is May 2011). However just to make things easier we have considered getting a secured loan to reduce payments.

What do you think? We have to go secured as we have a default that has been settled for 4 years on our credit file but still leaves us with a bad credit rating!!

Also would be nice to find out how we can improve our rating as we pay everything on time and havent missed a payment in ages.

hypno06

Personally I do not believe that consolidation is the best way to go - it seems a good idea for many, but the harsh reality is that generally it only adds to debt, not reduces it.

Have a look at the snowball calculator on www.whatsthecost.com and see if that acts as a motivator to getting your debts down quicker.

Also have a read of southernscouser's sticky above these posts and see if you can pull together an SOA which would help identify areas that you could grab a little extra cash from to bung at the debt, or to ease things off.

Finally, keep a spending diary - write down every single penny you spend over the next month, and see where you are wasting money. Again, a great motivator!

Good luck, and keep posting!

rayday2

I took out a consolidation loan for 16k over 10 years, I have paid for two years and requested a settlement figure and I owe 17.3k - also the interest rates rise on these it started at 8.4 and is now 10.5 - definately with my time again I would chisel away at them one at a time and not consoliate.

beverleyhills

hypno06 has posted very good advice.

Remember a secured loan means your home is at risk.

consnmattsmom

Thank you for the advice. I think I will just carry on as normal now I have seen what secured loans can cost.

I have done the snowball calculator and it says I will be debt free in 47 months at the latest or if I can over pay on loans will only be 36 months so I will have to check on if I can do that.

I am going to keep on checking this and when I get chance will do an SOA to see if I can save money elsewhere

consnmattsmom

Monthly Incomings:

My salary - £630
Partners salary - £1597
Child benefit - £120
Child tax credit -£40

Total - £2,387

Monthly Outgoings:

Mortgage/Rent - £571
Council Tax - £97
Electric - £71.
TV License - £12
Sky £80 (cant do without sports channels as only thing my hubby watches)
Phone - £15
mobile phone £40 (hubby on 18 month contract 16 months left)
mobile phone £25 - (my contract ends november 07 and gonna go payg)
Food - £200
Car Insurance - £35.48
Petrol - £100
Life Insurance £31
water - £27.23
buildings and contents ins -£21.36

Total: £1,326.07

Debts:

Barclaycard - Limit £3100 - Balance £3000, min payment 2% approx £62 0% til may 08

Catalogue - Balance £644 - Payment £85 interest free over 20 weeks

HSBC loan - APR 14.9% balance o/s £2900 monthly payment £85

HSBC mastercard - APR 19.9% pay approx £50 per month balance £1750

Virgin loan -balance o/s 3300 payment 124.96 per month 14.9% apr

Capital one c card - limit £1000 - monthly payment approx £30 apr 19.9%

car loan - balance o/s approx £8000 payment 234.83 ends 2011 apr 11.9%

bike loan - balance £3000 approx apr 11.9% payment £88 per month

Total debts per month 759.59

Total income 2387
total expense 2085

leaving 302 for keeping boys in clothing, car maintenance and tax,

Dont feel quite so bad now. Have done my snowball and seem to have light at end of tunnel.

What do you think of this?