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Unsure whether to consolidate - please advise

edited 30 November -1 at 1:00AM in Loans
241 replies 102.4K views
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  • zippygeorgeandbenzippygeorgeandben Forumite
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    Thanks Dobbibill. I've never paid interest in anything in my life so I don't intend to start in the Summer of 2017!
    Thanks MrsTinks as well - when I read it back, it does maybe come across that I'm not good with money but I actually think that I am. I can pay these monthly outgoings. I also have a bit of money in my account, not sailing close to the wind in the terms of going into my overdraft.
    ReadingTim - you haven't advised, you've just come across as, well, rude quite frankly.
    Ben
    Savings as of June 2020
    Savings account 1 - £14081.15(14063.93)Savings account 2 - £4500.00(4000.00)
    Current account - £4116.53(3136.31)
    Total - £22697.68 (19453.38)
    Plus £840 (£120 per month between CS/BS) HTB £600
  • AliceBannedAliceBanned Forumite
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    I don't get it - you are paying interest on your loans? So you have paid interest.


    I think in the previous posts everyone is trying to be supportive. They can see you are wobbling and want an easier way out and they are just saying there isn't an easier way really.


    I need to hear it just as much so that's why I responded. I totally sympathise, it's no fun repaying so much every month but we are all here to encourage eachother.
    DFW. PayDBX 2019#163 :A
    Debt at LBM: £18,335
    Current debt: £6,151
    Mort overpaid £800 EF: £200
    _________________________
  • Thanks Dobbibill. I've never paid interest in anything in my life so I don't intend to start in the Summer of 2017!
    Hmm, that doesn't agree with ...
    I currently have three debts I am paying off
    1) £5727.54 loan(started at £11k)with Zopa @ 4.8% - I pay £230pm
    2) £7568.74 loan(started at £12k in 07/2014)with Tesco @ 4% - I pay £222.61pm
    3) £4211.19 credit card with Virgin Money @ 0% until June 2017 - I pay £200pm (which is more than the £50pm they ask for)
    The "best" option numbers-wise would be to take a 5-year loan at a lower rate that allows overpayments (such as Sainsburys). Then continue to make the payments at the same amount you are now.
    The snowball calculator http://www.whatsthecost.com/snowball.aspx suggests that you'd be debt free by April 2019 if you somehow managed to get a low interest loan for the full amount. However, that only works if you are PHENOMENALLY disciplined (most people, including myself, are not) - to make this worthwhile you would HAVE to make the overpayment every month, even though it was optional.

    Play about with some of your options on the Snowball calculator to see what difference it makes - I can't help but notice that at £200 a month you won't have cleared the Virgin card by the time the 0% runs out (as Dobbibill has already said). What are you going to do if you can't switch to another 0%? I don't know what the rate would revert to, but guessing something like 13.9% would mean you'd still be debt free by May 2019 at your current rate. Better than Nov 2021 with a new 5-year loan!
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  • zippygeorgeandbenzippygeorgeandben Forumite
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    Sorry! I meant that I have never paid interest on a credit card! My apologies.
    As someone who had student loans, I'm aware of paying interest in my life! :)
    I appreciate everyone taking the time to respond and copy and paste certain anomalies in my posts.
    Thank you Angry Bear for the link too.
    Thanks for the encouragement AliceBanned.
    Ben
    Savings as of June 2020
    Savings account 1 - £14081.15(14063.93)Savings account 2 - £4500.00(4000.00)
    Current account - £4116.53(3136.31)
    Total - £22697.68 (19453.38)
    Plus £840 (£120 per month between CS/BS) HTB £600
  • zippygeorgeandbenzippygeorgeandben Forumite
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    @dobbiebill - I just received this email from HSBC (my bank) regarding a new CC
    0% interest on balance transfers until July 2019 with our low balance transfer fee of just 1.4% (min. £5)*1, *2 – as long as you apply and transfer a balance by 31 December 2016.

    I've worked out that that is roughly £60 to transfer and nothing to pay for 32 months.
    I could also reduce the repayments and make overpayments on one of the other loans yes?
    I obviously wouldn't have any interest to pay for a couple of years (although I know it's £60 to transfer).
    Savings as of June 2020
    Savings account 1 - £14081.15(14063.93)Savings account 2 - £4500.00(4000.00)
    Current account - £4116.53(3136.31)
    Total - £22697.68 (19453.38)
    Plus £840 (£120 per month between CS/BS) HTB £600
  • Nebulous2Nebulous2 Forumite
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    @dobbiebill - I just received this email from HSBC (my bank) regarding a new CC
    0% interest on balance transfers until July 2019 with our low balance transfer fee of just 1.4% (min. £5)*1, *2 – as long as you apply and transfer a balance by 31 December 2016.

    I've worked out that that is roughly £60 to transfer and nothing to pay for 32 months.
    I could also reduce the repayments and make overpayments on one of the other loans yes?
    I obviously wouldn't have any interest to pay for a couple of years (although I know it's £60 to transfer).

    That is a good deal!

    However there are two issues:-

    1. You don't really need a BT yet, as your credit card is still interest-free until next year. (presumably something you have already paid a fee for.)

    2. You might not get much of a limit given your other debts.

    Does your Virgin card allow money transfers? One possibility might be applying for that card, seeing what the limit is, doing a money transfer to pay off some or all of a loan, then doing a BT to cover the money transfer.

    That becomes complicated though, with potential missteps, and two fees to pay.

    It might end up more expensive than applying for a money transfer card and not a huge saving on the interest you will pay on your loans.
  • YorkshireBoyYorkshireBoy Forumite
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    I've worked out that that is roughly £60 to transfer and nothing to pay for 32 months.
    Other than the £105 a month (at the outset) minimum payment of course. ;)
  • DobbibillDobbibill Forumite, Board Guide
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    You will have to weigh this one up OP.

    You don't need it yet, you still have 6 months left on your VM card.

    I would be asking myself 'What is the rush with HSBC, why before 31st Dec? Are they planning better/longer BT deals at the beginning of 2017?' If only we had a crystal ball ;)

    Waiting comes with the risk that they won't offer anything as long, or with a limit high enough....that said you will owe less by June.

    Another option would be to transfer some of your VM balance now, assuming you are given a limit high enough, leaving just as much as you can clear by June. (Remember to factor in the minimum payments to HSBC so you will possibly be paying less to it than you have been)

    Either way allow time for a contingency- if you don't get the limit you want/need from HSBC, you have time to consider your options.

    As said though, something you need to weigh up, do you apply now? or do you wait until May 2017 ish?
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  • zippygeorgeandbenzippygeorgeandben Forumite
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    Thank you once again for the feedback everyone! All food for thought!
    Yes I don't need that card but it's not often I see a 32 month balance transfer offer at such a low rate!
    Savings as of June 2020
    Savings account 1 - £14081.15(14063.93)Savings account 2 - £4500.00(4000.00)
    Current account - £4116.53(3136.31)
    Total - £22697.68 (19453.38)
    Plus £840 (£120 per month between CS/BS) HTB £600
  • -taff-taff Forumite
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    I'm agreeing with Reading Tim. It's not rude to poiint out that you're in debt, looking for a consolidation loan and looking to live beyond your means otherwise you wouldn't have so much debt. Out of interest, what was the 12k loan you're currently paying back for?

    As above, you are borrowing more money to pay off debts you're incurring that you can't afford. In total, you're debts are roughly 17,000 pounds.

    When you apply for laon, they'll take that into consideration and be asking, do you earn enough to be 36,000 pounds in debt. They have no guaranteee you're going to use it to pay debts.
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