£14k CC debt, £65k combined salary can't get any loans!

zombeana

After a few poor decisions and an expensive wedding where costs just seemed to keep mounting....1 unexpected cost after another, we find ourselves with a high amount of CC debt.

2 of these are 0% for 1 year (£4000)

So we have £10k on 2 cards, one with 19.7% apr one with a horrendous 29.7% APR which we used in desperation.

Combined our earnings are fairly good (£65k) I have a small debt with a catalogue and that's it. CCs are in husbands name.

We cannot seem to get ANY loans less than 24.7% APR!! We want to get a 10k loan to pay off the high apr credit cards but we are hitting a brick wall. We have just found out we are expecting our second baby (unexpected) so our income is going to reduce (down to £50k) hence why we feel the need to move these credit cards into a more affordable payment, except at 24.7%...its not affordable.

I get that this is our own fault, but I am hoping to find a way to make it a little easier to manage... could anyone please help?

[Deleted User]

What have you tried so far? You won't have many options with that kind of debt and you need to place any applications carefully.


What do your files show, apart from the large amount of debt? Any missed payments etc?

In your situation, I would try for a lower rate card (rather the 0% ones) as you're probably more likely to get it. But if you have already been declined or have a lot of searches, you really need to leave it for a bit.

Look to see how you can cut costs and get the debt down in the meantime.

zombeana

We applied once with our current bank (santander) and was refused.

We checked with halifax (where the credit cards are held) and they will only offer us one at 24.7% APR

We daren't try anything else due to the mark on credit history...

I think we are just going to have to wait 6 months and try to save as much as possible, but even on our salaries which are fair, we do not have a lot of income left at the end of the month with our rent being £1300, student loan eats £300 almost of my partners salary, Ctax £210, childcare at £600....plus bills, food and a car. The CCS are taking £375 just the interest at the moment. Its so frustrating as there must be another way.

Will just have to try our best to save! We are already scrimping and looking for a smaller house....not fun as we already only have a 2 bed Oh well it is our own fault!

Oh and files are fine - zero late payments no discrepancies there.

simpson_77

try calling the credit cards companies, explain you feel the interest is high and may move the balance to another provider, however you would obviously prefer to keep it with them.

Chances are they will come back with an offer to keep you as a customer. if they don't nothing lost

Dobbibill

zombeana wrote: »

2 of these are 0% for 1 year (£4000)

So we have £10k on 2 cards, one with 19.7% apr one with a horrendous 29.7% APR which we used in desperation.

Combined our earnings are fairly good (£65k) I have a small debt with a catalogue and that's it. CCs are in husbands name.

We cannot seem to get ANY loans less than 24.7% APR!! We want to get a 10k loan to pay off the high apr credit cards but we are hitting a brick wall. We have just found out we are expecting our second baby (unexpected) so our income is going to reduce (down to £50k) hence why we feel the need to move these credit cards into a more affordable payment, except at 24.7%...its not affordable.

I get that this is our own fault, but I am hoping to find a way to make it a little easier to manage... could anyone please help?

Congrats on the new arrival news - don't beat yourself up about bad choices, just make sure you learn from them we've all been there.

What amount is on the each of the interest bearing CCs?

I'm not normally a fan of debt consolidation but if it saves money/interest then it's worth a second thought. 24.7% is obviously less than the 29.7% you are currently paying. Maybe if the split works then just look at a loan to move the more expensive part of the debt. Generally when you are looking for a loan the cheaper rates seems to be over £7.5k so be mindful the rate could increase if it's less than that, therefore not worth it.

I would look at completing a SOA. If you want to post then the DFW forum is a good place with plenty of knowledge and experience to cut costs/make savings.

If you are going to continue to pay the CCs with the interest rates at present then snowballing the debt, clearing the highest APR first is going to be the best way forward.

All I would add is, be under no illusions that this will be easy. It will be difficult and challenging on times but with determination you will get there and I wish you all the best.

drunk1

Try creation finance, they seem to be a little more lenient on loans around 10-12%.

Not the best option but a good mid-way point from 30% sharks and the best deals around.

Candyapple

I'm assuming your husband earns £50k pa (you mentioned £15k drop from £65k) and you have £14k debts.

1. Whose name is the debt under for the 2 0% debts? Name of lenders?

2. Same as above, the £10k on 2 cards - whose name is on these debts? Name of lenders?

3. Do you have any other cards / loans / overdrafts? (Individually as well as jointly)

4. Are you both on the electoral roll?

5. Have either of you had any late payments / defaults / CCJs in the last 6 years?

6. Can you list (individually and jointly) the credit limit and also how much you owe on each card.

7. How many applications for credit have you both made in the last year (individually and jointly)?

It doesn't make sense for you not to be able to even get another card/loan on the salary earned. Even when I was on £30k I had £27k in card debt (stoozing) and in most instances, lenders will generally allow half your annual salary as a debt ratio before curbing the reigns in, so something must be wrong with one or both of your credit histories for lenders to be so cautious.

If your joint annual salaries are currently £65k, that's roughly just under £4k per month after tax/NI. Where is your money being spent because you should have more than enough to make serious inroads into your interest bearing debts.

You both should (if you haven't already) signup with ClearScore and Noddle and pay £2 each to Experian to get copies of your credit reports from all 3 CRAs which will give you a truer picture of what info is held on you and could be the culprit.

zombeana

Thanks everyone for the advice.

re Candyapple

1. All the CC are in husbands name because i, for some reason have horrendous credit luck. I had 3 defaulted accounts 8 years ago but have been very good at managing since, these have dropped off my records but still i struggle to get any credit. I have a next account with a few hundred on and a Very account with £2k limit nothing outstanding. A phone contract and an MBNA 0% with £1200 of this 14k on (forgot about that one) paying the £25pm.

the other 2 cards for husband is MBNA with £1200 on and BArclaycard with £2000, I hold the 3rd MBNA with £1200 on - so its actually 4400£ across 3 cards, not 2, my mistake. At 0%

£10k on 2 cards is husbands again, Halifax and RBS one has 4k one has 6k

We have one car on lease £204 pm

Husband has overdraft of £1000 but is rarely in it

I have an overdraft too of £1000 which I have been out of for a while too.

Should we close those?

No other loans or accounts apart from my 2 catalogues as mentioned.

No CCJS in last 6 years for either of us and zero late payments.

EDIT - I just remembered, we voluntarily terminated a car on hire purchase a year ago after having it 2.5 years.

We are both on the electoral roll

MBNA are both £1250 we transferred the max it would allow
Barclaycard limit is £2k
Halifax card 1 is £4500 and there is 4k on there
Halifax RBS card 2 is £6500 and there is 6200 on there.

As far as applications go we opened the 2 MBNA and the Barclaycard early this year approx January.

I applied for Barcalycard but was declined (in Jan)
Husband applied for Virgin card was declined (In Jan)

Then a few days ago we tried the Santander and Halifax loan (twice for halifax, one just husband, one joint) so thats all of our applications. (husband tried on his own- halifax offered 24.7%, joint application was declined entirely.)

We take home £3370 after student loans, pension and childcare. (pension is 8% we are going to opt out for a few years which will up our income to £3680) But I have to bear in mind my salary will drop to £138 pw once I start maternity leave in November and we cannot afford for me to return to work with 2 children in childcare (£1300pm!) more than I would earn. My first born would not be eligible for free hours for another year after my return to work date. I will return to work once those hours begin though.



Phew...sorry for the essay and thanks for any advice.

zombeana

Completely forgot we completed a voluntary ternination on a hire purchase car last year - could this be the problem? (in husbands name again!)

tlc678910

Hi, at the moment it sounds like you will not be able to do much in the way of refinancing your cards.

Can I suggest you post for help and advice on the "debt free wannabe" board. People there will help you to look at your outgoings now and when you leave work (statement of affairs) and help you to see how you can cut back and manage e.g. debt snowballing.

Stopping paying into a pension is pretty drastic so try the board for advice to see if this is necessary and the right way to go.

Tlc

eskbanker

zombeana wrote: »

The CCS are taking £375 just the interest at the moment.

That's £4,500 over the year, which is obviously 45% of a £10K debt, rather than the lower APR figures you mentioned, so it might be worth checking the numbers a bit more closely on the off chance that one (or both) of the card companies is overcharging you?

I suspect that the key issue is limit utilisation, in that if you're currently using 95+% of your aggregated card credit limits, this is bound to scare off lenders I'm afraid, even if other ratios (such as limits to salary) may appear healthier.