Transfer credit card debt

SHEILA54

Hi

My daughter's husband left her last September. He encouraged her to take out credit in 2014/15 when he could no longer get it himself, amounting to over £10,000. She has 2 children and works part time, living with me at home.

She works 16 hours pw has an income of £7200pa and gets £400pm from him for the children + tax credits..

One of the credit cards,in her name, is at 28.9% APR and so she is looking to transfer to a lower rate, preferably 0% for a long period but I did a quick check on this website and it seems that with her low earnings she won't get any. Is there any other way or could she use the maintenance and tax credit payments as part of her income?

She has one loan which is costing her £140pm and the cc has a minimum payment of £110pm, which I am paying for her. Money is tight and it will take 5 years to pay off the cc at the present rate but just over 3 if she can transfer to 0%.

Her husband is not in contact but she believes that he has as much, if not more, debt than she has as he was not good at managing money.He has a full time job with an income of around £30,000.

Debt agencies will make her bankrupt and she doesn't want to do this as she is hoping to work more hours in the next couple of years when her youngest starts at secondary school. She is also hoping to move out in a few years time and can't face the stigma of poor credit on top of all that has happened.

Any advice would be appreciated

molerat

With that level of debt she would probably need an income of around £30K to be able to effectively take on more debt - opening another card would be seen as more debt by lenders. The DFW board would be a good place to start, many in the same boat over there.

Dobbibill

I doubt very much if she will get further lending.

Has she actually tried the eligibility checker on the main site.

How long is she thinking before she can increase her hours at work?

How long is the loan going to be running?

Don't worry about DCAs or any stigma. No one else needs to know her business, how or who she is paying. Yes, it will be reported to her CR but her priorities need to be herself and her children and their needs right now.

SHEILA54

Hi

She doesn't want to take on any more debt, just to clear what she has been left with at as lower interest rate as possible. 28.9 % is ridiculous and means that a lot of the payments are not reducing the debt by much.

As I mentioned before, I have done the eligibility check but she doesn't earn enough and I don't think that they count maintenance or benefits in their calculations? I have checked her credit score and it is good as she has only missed a couple of payments, which she thought that he had made before he left.

She is looking for more work but my granddaughter has been badly affected by the problems and is very emotional and clingy. He has been controlling and left other problems, not just debts.

molerat

SHEILA54 wrote: »

Hi

She doesn't want to take on any more debt, just to clear what she has been left with at as lower interest rate as possible. 28.9 % is ridiculous and means that a lot of the payments are not reducing the debt by much.

As I mentioned before, I have done the eligibility check but she doesn't earn enough and I don't think that they count maintenance or benefits in their calculations?

She is looking for more work but my granddaughter has been badly affected by the problems and is very emotional and clingy. He has been controlling and left other problems, not just debts.

The problem is that lenders will see it as taking on more debt - they do not know that she will not transfer the existing debt then run the card back up again.

Candyapple

If you trust your daughter implicitly to pay you back and you earn enough, you can take out a balance transfer card in your name and transfer her card debt onto that. She could set up the direct debits to repay it and it would be at 0% for however many months the deal would be.

Note that you would be the owner of the debt so if she did a runner or reneged on repayments, you would then have to pay it back.

I wouldn't normally advise to do this, however it sounds like you are a desperate parent wanting to help your daughter out of a tough situation.

Nebulous2

How do you know debt agencies will make her bankrupt?

She needs to speak to them and get advice - try Stepchange. They wont do anything unless she agrees to it, but they will make a recommendation. It may well be that the only sensible thing to do is to go bankrupt. With that level of debt, and very low earnings she could be on that repayment treadmill for a long long time. There are other options, they may well help her get the interest frozen, if she seriously doesn't want to go bankrupt.