Writing to Credit Cards

Squirrel29

I have already posted my SOA and started my snowball, it is giving me DFD in 45 months, my dad has very kindly offered to pay off my Cahoot car loan of approx £5700 and I will pay him back at 0%. This leaves about £10k of other debts between an Nationwide loan fixed at 6.7 months (30 more payments and £3900 left) and credit cards.

I have a Cahoot CC with balance of £2700 - lifetime offer of 10.9%, Virgin CC with £2117 - 18.9% and Nationwide CC with £1067 @ 16.9%. I am paying off Nationwide first - feel better about doing smallest balances first!

I have tried to get a couple of CC's this week with either lifetime of balance or 0% offers but have been turned down - I think my credit rating must be rubbish after doing applications in short space of time.

How would the remaining cc's respond if I requested freezing interest, I can carry on making normal payments using snowball method but the interest is obviously making a huge difference to timescale of repayment.

I don't want to knacker my credit rating further as I have a fixed rate mortgage coming to and end in 3 years time with Britannia and I don't want to end up on a sub-prime mortgage.

If I negotiate frozen interest, will this have a negative effect on my chance of renewing my mortgage (I don't intend to increase my mortgage, it is coming down slowly!)

GettingThingsDone

hi Squirrel - glad to see you took the loan in the end. Hope it feels like you're 'getting there'.

I have a Cahoot CC with balance of £2700 - lifetime offer of 10.9%, Virgin CC with £2117 - 18.9% and Nationwide CC with £1067 @ 16.9%. I am paying off Nationwide first - feel better about doing smallest balances first!

When you ran these figures through the snowball calculator what was the difference in DFD when paying highest %age first. Although it can feel better clearing off the smaller balance first, you could effectively be paying out more money than you need to.

I find the best decision comes from taking a step back, deciding how much in total you can allocate to paying off debts and then just do what the snowballer says. I just keep an eye on the big figure then, in the knowledge that it will be paid off in the most efficient manner.

Sorry to ramble

Also - yes, I think if you decide that you can't pay the interest then it will count against you in the future. I'm sure someone will be along to confirm.

Stick at it

gtd

CLAPTON

There is no chance that they will freeze interest unless you default on your payments... for obvious reasons.
It is sometimes possible to get your interest rates reduced by saying you will move the debts elsewhere.
If you do default on your debts your credit rating will be trashed for six years.

Also its best to pay the debts with the highest APRs off first and not the ones with the lowest balances. That way you end up debt free quicker and pay less interest

Squirrel29

Hi everyone, thanks for your answers. I can keep paying at least the minimum amounts and pay by dd so don't miss the payments. I therefore will keep plugging away using the snowball. It only made a couple of months difference if I pay highest off first, but I will look at it again. I guess I initially felt better about paying off smallest first and having achievement of closing an account.

I feel I am now developing a sort of OCD when it comes to money, I think of every pound paid off is another few hours towards my DFD!!

I am glad a found this site, I don't think I would ever have tackled this with out, I guess it a bit like having support of weight watchers when dieting!:rotfl:(Not that I can afford to go there now anyway!)

GettingThingsDone

I feel I am now developing a sort of OCD when it comes to money, I think of every pound paid off is another few hours towards my DFD!!

Join the club!

Think of paying off your smallest card as a chocolate treat for yourself - it's not the end of the world if you pay it off first, and it helps you get some positive feedback to keep you motivated...