I am so frustrated - please help!

ea81206

Hi, I am trying to sort out mine and my partners finances so that we are managing our finances better and to maximise what we have to spend every month (i believe life is for living, and making most of what you've got as well as keeping it under control, could be dead tomorrow!!)

We are aiming to clear all of our debt by Dec 2011 (excluding mortgage)

Debts include:
Loan1 Current balance £9,850 (end March 2011) @ £251 a month
Loan2 Current balance £6,600 (end Nov 2011) @ £150 a month
C/Card 1 current balance £1,600 @ 29.9% APR approx £80 a month (limit £1800)
C/Card 2 current balance £1,600 @ 0% until Feb 08, then 17%, £50 a month (limit £2000)
C/Card 3 current balance £1,300 @ 17.9%, £30 a month (limit £2,500)
Hire Purchase loan balance £400, £16 a month
Store cards total £300, £30 a month

Total: £600 a month

We are both in stable, well paid jobs (joint income £60k per annum). I have recently been given a significant rise in salary and have decided to cut up all credit/store cards as we have more than enough disposable income left to save for luxury goods rather than put them on credit cards.

I decided best way to control the credit/store cards was to do a consolidation - but nope, no where is giving me/us a loan - not even an increase on credit limit or a balance transfer to the 0% card from horrendous 29.9% APR card! I'm so so frustrated :mad: - my credit score is excellent, my partners is good also. The large APR card is in my partners name and even he can't get another lower APR card. Why is this happening??! If I could balance transfer then we would have £80 more every month to make overpayments on our mortgage.

All we want is to make the most out of controlling our debt without paying stupid amounts every month when we could put money to use elsewhere.

Any advice?!! Are we being over ambitious in trying too hard and should just focus on paying everything off over next few years? I know that there are many in a worse position than we are, I apologise if I frustrate anyone when our circumstances aren't close to problems of others.

Thanks!!

fiveyearplan

Have you checked your credit with Experian etc.? That may be the place to start.

ea81206

Yes, have checked credit reports with Experian and Equifax - both rated as excellent/good ratings.

I know we have alot of credit but we're not wanting to borrow more just put it all in one place. This is why i'm confused?

RAS

Hi

Putting it all in one place is not going to be the best way to pay it off effectively. And people here will tell you that consolidating into one loan is a seriously wrong idea unless you can pay it off over the same time period and at a lower APR than at present.

And it is a seriously wrong idea unless you get the CC spending under control.
As a starting point

Loan1 Current balance £9,850 (end March 2011) @ £251 a month - what is this for - APR can you repay early without penalty?
Loan2 Current balance £6,600 (end Nov 2011) @ £150 a month - what is this for - APR can you repay early without penalty?

C/Card 1 current balance £1,600 @ 29.9% APR approx £80 a month (limit £1800) - throw every extra penny you have at this card - except if you do what is suggested below, the balance will be £400, so you should be able to clear it in one month. Reduce the limit as soon as you have moved the money across.
C/Card 2 current balance £1,600 @ 0% until Feb 08, then 17%, £50 a month (limit £2000) - transfer £400 from the 29.9% card to this one. If necessary, use it to pay for things and then transfer the exact same amount to the 29.9% card to move the debt
C/Card 3 current balance £1,300 @ 17.9%, £30 a month (limit £2,500) transfer £1200 from the 29.9% card to this one. If necessary, use it to pay for things and then transfer the exact same amount to the 29.9% card to move the debt

Hire Purchase loan balance £400, £16 a month - avoid this in future
Store cards total £300, £30 a month - what are the APRs on these?

Now if you have made repeated attempt to get credit and been rejected, do not make any more attempts for 4-6 months.

izzybusy23

ea81206 wrote: »

Why is this happening??! If I could balance transfer then we would have £80 more every month to make overpayments on our mortgage.

Thanks!!

The big credit crunch I'm afraid. Banks are tightening their lending criteria. I think 0% balance transfers won't be around for long. I have been a long standing customer of MBNA and just transferred a BT to them at 5.9% for 9 months.. thats all they were willing to do.

Also if you keep applying for new credit cards in a short space of time then it will affect your credit score.. or if you are applying for credit cards which are linked (MBNA/Virgin for example).. if you hold one and apply for the other then you may get turned down for that reason.

I think we are beginning to see the end of easy money I'm afraid.

ea81206

Thank you all for your responses.

I think the best course of action is to:

Transfer £1,100 from 29.9% CC onto Egg 17% CC which is only credit card that will accept a balance transfer (the 0% card will not accept one?!). Egg card will only accept up to 95% of credit limit - this card will then be maxed out.

Balance on 29.9% will be £500 - pay this off over next 2 months.
Pay off balance on 3 store cards (£300) over next 2 months.

Remaining balance should be a total of £4,030 on 2 credit cards - pay off over 2 years.

I won't be applying for any form of credit for next 6 months+ (likely next form of credit will be for a car - hope we can get credit for that?!)

Thanks everyone for your help - I hope we can stick to this plan (despite Xmas approaching which is always a financial burden!)

rayday2

Start putting some money aside for Christmas now or cut down on any luxuries and you could do a credit free Christmas which is very liberating not getting any bills in January!

RAS

Hi

On your incomes, you do not need car finance. Put money into an ISA each month and you should have a decent amount in a year.