To Pay or Not To Pay Using a CC

mistertml

Hi

I am hoping to get some advice

I am currently in charge of my DMP and finally making headway on my debts.
I owe around the following amounts:

Hfx CC/Idem - £4156 - Default date 10/10
barc CDL - £1884 - Default Date 12/10
hfx/marlin - £1102 - Default Date 06/10
next - £802 - AP Status
van - £792 - Default Date 12/06

I do have a credit card for emergencies and have a balance of £200 on there.

All the interest is frozen apart from the capital One with £200 and Next.

I can afford an extra £150 on top of my DMP on most months.

I have a limit of £1500 on the Capital One and have around £1000 in savings.


I currently pay £55.00 towards Next and they charge around £18.00 in interest a month. It was never placed in default and when I queried it, I was told the Default would apply from now and not from 2010 when I fell into debt. I didn't want to raise a query as I dont want new default on my file as the vanquish one will finally drop off my file at the end of 2017.


Would it be wise to pay the Next Balance off with the Capital One or should I just make payments as normal?


Any Advice would be appreciated.

Thanks in Advance.

sourcrates

mistertml wrote: »

Would it be wise to pay the Next Balance off with the Capital One or should I just make payments as normal?

Any Advice would be appreciated.

Thanks in Advance.

Hi,


Would it be wise, Hmmmm !!!


Basically all you would be doing is shifting the debt from one place to another, you would still be paying interest on the debt.


I can see your point, not wanting to get another default as the rest are so close to dropping off your file, but I think it might be preferable trying to persuade Next to stop charging you interest rather than shifting the debt around.


They should not automatically default you for stopping interest, if you are persistent they may give in, quote the lending code to them about treating debtors fairly, id try that approach first if I were you.

National_Debtline

Hi mistertml


You haven't acknowledged another option, which is using some of your savings to reduce/pay off that Next balance, as opposed to using a credit card.


I am not pushing you one way or the other as I understand it is important to try and keep some funds by for emergencies, just making the observation that while your Next debt is currently accruing £18 in interest each month, I suspect your savings are not growing at the same rate.


Dennis
@natdebtline

redux

I'd also suggest use your savings to pay Next off.

If you usually have £150 to spare in a month, and this all goes to Next this time, then with the regular £55 you just need £600 from savings to clear it.

After than you have an extra £73 (55 + 18) a month to play with, and if you don't send the extra £150 to the others for a while you replace the £600 in savings in under 3 months.

If you'd rather keep more savings margin, then send all the spare £150 to the savings for 2 or 3 months, then do the clearance as above.

edit: and of course, if you aren't usually paying the Cap1 in full, then do this first and each month in future, to stay interest free on current spending