Debt and stressed

mariahussain

I was wondering if anyone could help or point me in the right direction. I have several credit cards which I am paying high interest on. I can't seem to shift these debts as I seem to get rejected for new balance transfer cards. I don't know what else I can do and it is really worrying me.

I used to live with my mum but My mum passed away last month and my dad around 10 years ago. I have no mortgage to pay and have a full time job. I have income around £2200 per month but I do now have bills to pay gas, electric, water etc


These are my main cards
Virgin - 9200 - approx 130 interest
Barclaycard - 11000 - approx 220 interest
debenhams - 1500- approx 70 interest

What could I do to cut the interest as I am approximately paying over £400 just on interest. I can't seem to get new card or loan due to poor credit rating. Any help would be appreciated as I have been forced to rethink my life due to mum passing away and also suffering from stress as it is.

honeybee111

you have more spare cash than us and we are a family of 5 with a mortgage.
what are your other debts?

Because i take it you inherited a house? the easy option would be to get a secured loan on it. with the intention of paying that off over 5 years.you will probalby pay the same as you are now but at least it will be getting paid off where as now you cant really do that. You will get that loan if you own a property. your credit score isnt as important as its secured on your house. although keeping up with payments on other things will get you a better credit score.

However speaking from experience... its far too easy to get a secured loan, pay off the debt then spend it all on the cards. trust me... im now paying a secured loan, unsecured loan and a large credit card debt. we have debts over £32k. and its a serious problem for us. i personally cant see anyway out for us right now, and my husband who also inherited his house has no intentions of changing his spending habbits.

if you want to make your life easier you have to change your habbits and stop spending.

HappyMJ

mariahussain wrote: »

I was wondering if anyone could help or point me in the right direction. I have several credit cards which I am paying high interest on. I can't seem to shift these debts as I seem to get rejected for new balance transfer cards. I don't know what else I can do and it is really worrying me.

I used to live with my mum but My mum passed away last month and my dad around 10 years ago. I have no mortgage to pay and have a full time job. I have income around £2200 per month but I do now have bills to pay gas, electric, water etc


These are my main cards
Virgin - 9200 - approx 130 interest
Barclaycard - 11000 - approx 220 interest
debenhams - 1500- approx 70 interest

What could I do to cut the interest as I am approximately paying over £400 just on interest. I can't seem to get new card or loan due to poor credit rating. Any help would be appreciated as I have been forced to rethink my life due to mum passing away and also suffering from stress as it is.

You'll need to pay almost every penny you earn towards the barclaycard credit card leaving just enough for your monthly direct debits in your current account each month as soon as you are paid. You'll have no cash so use the credit card to pay for things and don't use it very often...the less the better. I would only purchase groceries for the time being until you get that balance down. You are lucky that you have no mortgage or rent to pay and should be able to clear this debt by this time next year but you'll have to just stick to the essential bills and groceries only.

andyfromotley

Hi Maria,

Sorry to hear about your mum. Welcome to the forum. Do not get a secured loan!! You will be putting at risk your main asset!! Turning unsecured debt into secured debt is almost never a good idea!

You need to post a full picture of your finance on here using this template http://www.stoozing.com/calculator/soa.php

We can then give more appropriate advice. If you can't shift it to 0% it may be that you just have to knuckle down and get it paid as quickly as possible, but we need to see your finances first.

sourcrates

One option would be to stop paying the accounts, let them default, they will, eventually, be sold on, then in the time it takes for this to happen, save as much money as you can.
Once sold on, there will be no further interest or charges, and you could then negotiate to settle each account, as and when funds allowed, you would be able to get at least a 30% discount from a DCA, perhaps more.
This would have a negative affect on your credit file, but as it already seems to be less than perfect, it would not matter that much.

mariahussain

honeybee111 wrote: »

you have more spare cash than us and we are a family of 5 with a mortgage.
what are your other debts?

Because i take it you inherited a house? the easy option would be to get a secured loan on it. with the intention of paying that off over 5 years.you will probalby pay the same as you are now but at least it will be getting paid off where as now you cant really do that. You will get that loan if you own a property. your credit score isnt as important as its secured on your house. although keeping up with payments on other things will get you a better credit score.

However speaking from experience... its far too easy to get a secured loan, pay off the debt then spend it all on the cards. trust me... im now paying a secured loan, unsecured loan and a large credit card debt. we have debts over £32k. and its a serious problem for us. i personally cant see anyway out for us right now, and my husband who also inherited his house has no intentions of changing his spending habbits.

if you want to make your life easier you have to change your habbits and stop spending.

I have inherited the house but it would be shared ownership with my brother and sister but they are married and live separately. Every time I get paid it goes straight towards paying the credit card bills. I am also looking to get married over the next few years and I need to save for that as well yet I do not seem to find an easy option.
I usually keep up with my payments every month I probably only have missed payments couple of times over the past couple years and that was down to silly mistake yet I can't seem to get good deals.
I have one more card and that is with Halifax and that has about another £1000 on it but I only pay around £10 interest

mariahussain

andyfromotley wrote: »

Hi Maria,

Sorry to hear about your mum. Welcome to the forum. Do not get a secured loan!! You will be putting at risk your main asset!! Turning unsecured debt into secured debt is almost never a good idea!

You need to post a full picture of your finance on here using this template http://www.stoozing.com/calculator/soa.php

We can then give more appropriate advice. If you can't shift it to 0% it may be that you just have to knuckle down and get it paid as quickly as possible, but we need to see your finances first.

Thank you I will give this a go. Appreciate the advice.

Mort

Secured or unsecured loans to consolidate date are not the way to go, I went through that cycle 3 times and it caused a heap of trouble.

If you are being declined balance transfer cards your credit score might be in trouble, Noddle have a free account which will tell you how they rate you, they are part of Callcredit, one of the UK credit reference agencies.

If you have some wiggle room in your budget you can consider Snowballing your cards. This is paying off the one which costs the most first while making minimum payments on the others or if you need a moral boost hit the smallest debt first.

peteuk

First of all, I am sorry for your loss, it is a difficult time and facing up to your debts must be putting an extra strain on you at this point...

This may or may not work, but have you contacted them about having a payment break or offering them a smaller payment for a period (3 months) this may reduce the interest but also give you breathing space to look at everything...

I would try and avoid defaulting on them (personal opinion) as the default will be on your credit file for 6 years and although the interest may be reduced or stopped, its long term effects need looking at.

Good luck with however you resolve this issue.

Pete