Good times for a change

MaudeLebowski

I just want to share some good news, in case it inspires anyone else to go down the route I have...


I've spent £11,000 on 2 barclaycards (with insane APRs of 26.9%)....it's just been a few years of living outwith my means really. I moved in with my boyfriend this year and I knew I needed to sort my finances out so we could eventually buy somewhere together (aahhh, grown up stuff!) I was looking to consolidate my debts and hopefully pay a bit less in interest.


Anyway, banks wouldn't touch me because of a couple of Arrangement to Pay agreements I had a couple of years ago. I thought I was gubbed basically. But a friend suggested contacting a credit union, which I did on Saturday to discuss a consolidation loan. Today they called telling me i'd been approved in principle! YAY. The interest rate is way lower than Barcalycard. I feel like a massive weight has been lifted! :j
I'd definitely recommend getting in touch with a credit union if you're in a similar situation.

WantToBeSE

I have heard great things about CU's.

Really pleased for you, that's a great step in the right direction!

[Deleted User]

Could you share with us the details of the loan? Interest rate and length etc?

MaudeLebowski

Of course.
The loan is over 24 months, although I had to option to go up to 60 if I wanted. I just want to get it paid off asap. I'll be paying off £550 a month.

I've borrowed £11450 in total and the interest is 14.9% - I know that probably still seems steep to a lot of people, but when Barclaycard are charging 26.9%....

In total I'll be paying £1740 in interest on the loan....if I kept the credit cards with Barclays and paid the same amount per month, the interest would be £3668 - I had to sit my Higher Maths exam twice just to get a C but even I know that that's a tasty saving! £1928 is better in my pocket than Barclaycard's!


I wish I'd known about Credit Unions sooner! Everyone I've dealt with has been so kind and helpful and they really take into account your personal circumstances, rather than just the facts and figures on your credit report.

peaceandfreedom

MaudeLebowski wrote: »

Of course.
The loan is over 24 months, although I had to option to go up to 60 if I wanted. I just want to get it paid off asap. I'll be paying off £550 a month.

I've borrowed £11450 in total and the interest is 14.9% - I know that probably still seems steep to a lot of people, but when Barclaycard are charging 26.9%....

That is an eye-watering interest rate but better than 26.9%. Did you try moving your debt to 0% credit cards first or were you not eligible for those?

Also have you now cut up those credit cards? I just ask because I have twice done the classic trick of getting a loan to pay off the credit card and then run up the credit card again. Bingo, I had a loan AND credit card debt. The thing that finally sorted me out was 0% card-tarting and refusing to allow myself a 'spending' credit card. Wonderfully concentrates the mind, having to live on one's own money instead of someone else's .

Also, I came across Mr Money Moustache and he has some very interesting views - including this one - Your debt is an emergency.

Good luck on your debt-free journey - I am still on mine but the end is in sight .

sourcrates

Please make sure you close down the credit card accounts and don't ever be tempted to use them again.

That's the key to making a consolodation loan work, otherwise your back to square one again, and you don't want that !!!!

MaudeLebowski

Unfortunately the defaults etc left me pretty much out of options....nowhere would touch me for 0%. I've planned a pretty strict budget for the next year, so I can afford to pay an extra £100 a month towards the loan...so glad there are no penalties for doing this. So i'll be debt free sooner than originally planned!

And don't worry, both accounts are now closed! I've read too many horror stories for me to keep them open!