it's now or never

debtnav

Hello all you lovely people

I've been looking at mse for ages gathering great tips along the way and cheering on the successes. I never thought I'd be in this position at my age but the old adage "you never know what is round the corner" is something, in hhindsight, I should have been prepared for financially.

I have accumulated debts of £37000 (aided and abetted by my partner) and need to clear up the mess ASAP. My plan is to live very frugally over the next months/years and pay off as much as I possibly can as quickly as possible.

I have managed to get 0% finance spread over several providers but they are mostly short term deals so the first few months are going to be really tight. One old deal comes to an end in 3 months and it has proved impossible to get a new deal to cover the remaining £6k - I'm looking at a jump to almost 20% bu at the same time I have decided not to fall into the same trap again so will be paying off the new 0% short term deals within the set period. I will keep trying to get a new0% deal as I pay off the rest.

Wish me luck! :grouphug:

EssexHebridean

Welcome to Diary land Debtnav! :hello:

Take it you've done your SOA and checked all your figures? Do you have plans for where you can scrimp and save to hammer the debt down? Good work on getting the 0% deals - the picture may be different when you get to the point of that shortest one coming to an end and there may be something out there you can shift to at that point - remember to use the Eligibility Calculator on the main site when you come to check to avoid leaving a print on your credit file, though.

debtnav

Thank you Essexhebridian.

I've been number crunching for the past couple of weeks and I know it's going to be really tough but I'm determined this time that I will not be persuaded to just pay minimum payments as has happened before.

Thanks for your encouragement.

debtnav

Just had a nice online chat with very helpful assistant who has clarified that when additional sums are added to account at the same rate, the first sum is paid off first. This was one of my worries about hitting the cut off date for the first loan. I'm now going to do a bit more number crunching to make sure I pay enough of to clear them both within the promotional rate times and set up a standing order to cover it.

Cailbhinn

I think the law changed debt that those amounts which attract the greatest interest are paid off first. Certainly when I had a few zero % deals ending at different times with Virgin they actually broke it down with highest interest (or closest to losing zero % deal) first for pay off.

All the best with your debt free goals! Frugal doesn't have to mean boring or starving. Just being organised!

debtnav

Thanks for your good wishes Cailbhinn. I'm fairly organised as a result of living out of town and it costs time and money to go shopping but should really cut down on how much we eat anyway - I cook from scratch but just enjoy it too much!

Cailbhinn

debtnav wrote: »

Thanks for your good wishes Cailbhinn. I'm fairly organised as a result of living out of town and it costs time and money to go shopping but should really cut down on how much we eat anyway - I cook from scratch but just enjoy it too much!

Don't know if you've read my diary but I basically started this after shocking myself at the weekend counting up how much I spent on food in September. £400! For me, myself and I. Disgusting. No wonder I've piled on the weight and not made any dent in my debt!

debtnav

My other half laughed at me for returning an unwanted item today - cost £1.99. I told him that will keep us in milk for the week!

EssexHebridean

Morning Debtnav - quite right on the milk thing, good work!

I got your DM by the way but currently your settings don't allow me to reply. The SOA link is in the "Sticky" post at the top of the main DFW board if you still need it by the way.

Good news on the order in which payments are taken into account there too - that'll definitely help!

debtnav

Thank you EssexHebredian for where to find SOA. While I was there I found other useful stuff too.

Just completed the "snowball" form on line and got a surprise when it suggested that big overpayments should be made to the oldest debt which will start accruing high interest in January and only pay minimum payments to other debts which will then start accruing interest in a few months. I thought that by paying off 0% debts within the promotional time I was doing the right thing and only have one debt accruing interest. I'm not going to argue with the technology so need to rethink the standing orders already set up. The snowball did not suggest making overpayments on secured debts but they are allowed, so when all unsecured debt is finished I will reassess the situation.

EssexHebridean

Ahh yes, the snowball calculator. Almost makes me wish I had debts to play around with on there, that tool!

Generally speaking secured loans (and indeed mortgages) are at a lower interest rate than CC's (other than 0% rates) and unsecured loans, this is why as a rule so long as you are able to meet the required payments they get left until last to deal with. There is also sometimes early repayment penalties to be taken into consideration with secured finance.