How can I get rid of this overdraft?

kcmatt79

HiIf you have seen my previous thread, you will know that I have £17k unsecured debt. Nearly all of this is on 0% credit cards (except for £2,700 at 7.6% loan and £2000 overdraft). The overdraft is £250 interest free, but £1,750 at 12.9%. This costs me £15 roughly a month in interest, but I also pay £10 fee for the account (with that, I get AA breakdown, mobile phone insurance, travel insurance and card theft protection). I have been advised on here to clear this debt first (which makes sense as it's the highest rate of interest that I pay). However, I can't see how I'm going to do this, as I go up to the limit every month. I don't think I have the discipline to just pay it off by having money left in my account at the end of the month. I would rather have a fixed amount that I need to pay towards and have the nice feeling of actually being in credit at the start of the month! My first thought was to top up my loan. However, I would then be paying 9.9% interest. My other thought was to get a 0% credit card. However, I don't think I could afford the 3% minimum of this every month (I don't have a great deal of disposable income). My repayments already take a massive chunk out of everything and I don't want to get behind with anything.I wondered whether anyone could recommend another way?Thanks in advance

Jacks_xxx

Hiya hon,

What about opening up a new bank account and then paying a set amount into the overdraft account each month as if it was a bill?

Love Jacks xxx

kcmatt79

That's a good idea! See? I knew you great people would know what to do! Does anyone know if you can open another account with Alliance & Leicester if you already have a joint account with them?

kcmatt79

Oh, and, can I get the quidco cashback if I already have one account with them?

gems2381

I don't think you'd get the cashback if you already have an account.....but you could always try

kizzykizzywizzy

Hi kmatt79, I'm trying to do the same as you are & pay off my overdraft, it gradually crept up to £2000, & stayed there for at least a year probably more, just went down when wages paid in, was paying my cards off & not paying off the overdraft, but after joining the site & as my cards are at 0% am paying off the o/draft, want to do this by December, am just paying the min on the cards, which comes to approx £ 150 & throwing at least £350 at the overdraft, at the moment am paying almost £20 in interest, which will be much better spent on the cards once I've cleared the overdraft. It's so easy to keep the overdraft as you don't have to pay anything off every month, but it is coting you & me a fortune!!
What helped me was getting a Virgin credit card, the 1st month the payment was quite high, I believe due to the balance transfer fee being added??, but now the min payment is only £5, which frees more to pay off o/draft, & theres just under £9000 on it, no idea how they calculate this & why it's so low, I suppose they hope you won't pay off much & will keep it on there once the interest goes on, which of course I wont!
How I keep track of the o/draft & don't spend what i've paid off is by writing every single thing I've spent down & keeping all the reciepts so I don't forget something. Once I've got it down to £1000 will lower the limit to £1500, just to be on the safe side. Also as it's a small amount compared to my cards, can really see that I am chipping away at the debt. Good luck

Buffythedebtslayer

I did the open the other bank account thing to pay off my overdraft when I finished uni. Now I have a spending money account and a bills account. it works ok.

Overdrafts are a pain because they are always there! I still have an over craft facility on my bills account and it is a BIG temptation.

kcmatt

Right, I can't get an A&L account as I already have one (our joint account). Which is the next best to get?

madmoney_2

not sure which is the next best to get - i just know that u shouldnt go with hsbc!!!!

vandanfc

Hi

How about going through a cashback site and getting paid to open a new account. Quidco & Topcashback only seem to show A & L, but clickcashback.co.uk are offering £40 to open a Citibank Direct Current Account.

Don't know how good they are as a bank, but I think there are threads on here about them.

Clickcashback seem to have only just launched, but the transaction i did has shown up, but I don't know when it will pay out just yet. But it's worth a gamble.