Dan's desperate dash towards solvency

worriedDan

Hello everyone. Hope everyone is ok. i haven't posted for a while but will be making an effort to get back on track!

Things have been going ok. Ticking along nicely and the debt reducing month by month, however I had a bit of a blow today. For the last 18 months I have had the interest frozen on my creation credit cards. This was agreed to support me with my ongoing mental health issues. I pay the minimum payments, just with no interest applied. This hasn't impacted on my credit file and I have been able to bring the balance down without worrying about interest. I had gotten very stressed over this at the start of my DF journey. I am still on anti-depressants and still receive support via CBT but things are ok.

Today I arrived home to a letter telling me that the interest freeze will end. I was quite taken aback by this as I spoke to someone 6 weeks ago and was told that this wouldn't happen. I also have an email telling me that the support would continue as long as I was being treated. I called however it was quite late and the member of staff needed to speak to a manager, so I have to wait until Monday

If the interest freeze does end then I will have to pay an additional £175 per month in interest. I don't appear to be eligible for balance transfer at the moment and I loathe to try and apply in case I am rejected as this will impact my ability to get another 0% deal.

I have managed to get our monthly interest down to around £250 per month, however this will increase to £425 if the interest freeze ends.

My wife's attitude is that we have to suck it up and just keep paying until we can transfer it elsewhere. Me being me is worried!!!

enthusiasticsaver

If you are still paying £2k towards the debts each month can you not increase the payments? You have a high income so just target the creation card as priority if that is the only one charging interest. Has your wife now returned to work?

Certainly no harm in seeing if they will extend the interest free period but they don't normally do it indefinitely but they do need to take mental health issues into account. 18 months is quite generous though.

worriedDan

enthusiasticsaver wrote: »

If you are still paying £2k towards the debts each month can you not increase the payments? You have a high income so just target the creation card as priority if that is the only one charging interest. Has your wife now returned to work?

Certainly no harm in seeing if they will extend the interest free period but they don't normally do it indefinitely but they do need to take mental health issues into account. 18 months is quite generous though.

Hi, yes wife is working full time.

We aim for £1700 per month now. Following our mini crisis last autumn we opted for something slightly more sustainable. This has allowed us to build up some savings though.

Yes we can prioritize these cards. It's just a bit soul destroying to see £400 of our money going on interest alone. Still. there's nothing we can do so we've just got to get on with it!

enthusiasticsaver

worriedDan wrote: »

Hi, yes wife is working full time.

We aim for £1700 per month now. Following our mini crisis last autumn we opted for something slightly more sustainable. This has allowed us to build up some savings though.

Yes we can prioritize these cards. It's just a bit soul destroying to see £400 of our money going on interest alone. Still. there's nothing we can do so we've just got to get on with it!

You could use some of the savings to clear the debt? No way will you be earning £400 a month in interest. It makes no sense to have savings beyond emergency savings when your debt is as high as yours.

Suffolk_lass

Hi Dan,

A few things occur to me.

Have you been on the main site credit card eligibility checker? this will tell you your likelihood of being accepted by different CCs for deal rates. You say you don't think you are eligible but checking out what you could get will give greater certainty. And if there is one, you could ask to move more than one card balance to the 0% or low rate - someone else on here asked and got much more than they expected because they asked. Especially likely if they charge a %age fee to start the BT. Barclaycard also offer a cash transfer for a 1.9% fee for 9 months - could you max out a card on that sort of deal to pay down the higher one?

Also have you joined the MSE Credit Club? this will let you check your Experion Credit rating without it being impacted. I have added the links below:

eligibility checker

credit club

I was wondering if you had considered consolidation of some of the interest paying debt? It depends on your circumstances and is usually discouraged but it can work to take the pressure off and allow priority debt to be attended to first. It will on your date-to-pay-off time profile for paying down the debt, how much, how many, and so on. £400 is a lot of interest per month. I appreciate using savings is a hard step but the golden advisory (I hate rules) is debts first, then save (except, as ES says, for an emergency pot).

Have you done an up to date SOA? - If you are willing to put it up, we might be able to spot a few savings in your spending. I try and do one and privately review things every year, just to keep up to date, although I don't put mine up.

worriedDan

Suffolk_lass wrote: »

Hi Dan,

A few things occur to me.

Have you been on the main site credit card eligibility checker? this will tell you your likelihood of being accepted by different CCs for deal rates. You say you don't think you are eligible but checking out what you could get will give greater certainty. And if there is one, you could ask to move more than one card balance to the 0% or low rate - someone else on here asked and got much more than they expected because they asked. Especially likely if they charge a %age fee to start the BT. Barclaycard also offer a cash transfer for a 1.9% fee for 9 months - could you max out a card on that sort of deal to pay down the higher one?

Also have you joined the MSE Credit Club? this will let you check your Experion Credit rating without it being impacted. I have added the links below:

eligibility checker

credit club

I was wondering if you had considered consolidation of some of the interest paying debt? It depends on your circumstances and is usually discouraged but it can work to take the pressure off and allow priority debt to be attended to first. It will on your date-to-pay-off time profile for paying down the debt, how much, how many, and so on. £400 is a lot of interest per month. I appreciate using savings is a hard step but the golden advisory (I hate rules) is debts first, then save (except, as ES says, for an emergency pot).

Have you done an up to date SOA? - If you are willing to put it up, we might be able to spot a few savings in your spending. I try and do one and privately review things every year, just to keep up to date, although I don't put mine up.

Hi Suffolk Lass. Not sure if consolidation would be for me. We have done it many many times over the years and it has always led us into more debt. My mindset is very different now, however I am not sure if it's for me.

The interest hike won't kick in until around April so we are going to have a good think about our options. It may be that we do use some savings to help reduce the balance.

worriedDan

Been out for a pint with my dad tonight - just the one!!

He has been a constant source of support since I started this journey, as well as supporting me through my depression. I talked to him about my concerns that my interest is possibly about to increase and that It was causing me some worry. He always manages to put things into perspective and reminded me of the progress that we have made and that basically I just need to get on with it

My mum has a big birthday this year and to celebrate she and my dad are paying for us all to go away for a week in the summer, all inclusive. Really looking forward to it as it's not something that we would have done due to our budget! Feel very fortunate to have their support.

Scott-Weiland

So what are you doing too increase your earnings too help clear the debts??

worriedDan

Scott-Weiland wrote: »

So what are you doing too increase your earnings too help clear the debts??

b,

Hi, I am already working a busy full time job as well as doing some freelance work in addition to this so I don't really have any capacity to take on any more work. I am also still trying to get my mental health sorted so this is a big focus for me at the moment.

My wife has also gone back to work full time. She has to take responsibility for childcare when I am doing mu freelance stiff so she can't really pick up any additional work at the moment.

We actually have a good take home income of 5.1K combined so there's enough coming in to get this debt sorted, It's just a matter of making sure that every penny is used wisely

Scott-Weiland

Mental Health yeah i hear you with that one, i have struggled with it for years i have type2 bipolar and i manage it by training a !!!! tonne and making sure i eat perfectly. I know its not easy and debts and the stress of them are a pain and not needed pressure.

5100 is a good net pay, but i suppose its what your overheads are, have you done a recent Soa??