Leaving unpaid credit card to go travelling.

PeacefulWaters

Sell the car. Clear the debt.

RG2015

The minimum payment is 1% which will initially be £10 per month on a balance of £1,000. I guess that your monthly interest will be at least 2% which will start at £20 per month but will increase every month.

Have you considered balance transfer to a long term (24 to 39 months) 0% credit card?

[Deleted User]

RG2015 wrote: »

I guess that your monthly interest will be at least 2% which will start at £20 per month but will increase every month.

The interest would actually decline each month, as long as no new spending was put on.

The minimum payment will be 1% plus interest (and any fees).

RG2015

Deleted_User wrote: »

The interest would actually decline each month, as long as no new spending was put on.

The minimum payment will be 1% plus interest (and any fees).

Thanks for correcting me. In 40 years of regular credit card use I have never paid any interest so I did not realise that the minimum payment added in the interest.

Therefore the month 1 minimum payment (or 2 depending on timing) will be £10 plus £20 interest and the balance will reduce to £990. The next month the balance would reduce to £980 and then £970 and so on (approximately).

According to my calculations after 24 months the total minimum payments would be about £643 and the balance would be down to about £785.

chattychappy

It does seem like a relatively small amount of money - hardly worth trashing your file for. If you have a good record so far, then I would consider getting a balance and/or money transfer card. Transfer the balance and money transfer enough cash to a current account to meet two years' minimums. Don't use this cash amount for any other reason. This means you can go to Australia for two years without having to transfer any money back. Of course you will return to a debt that's bigger than what you left with. But this is worst case. Even better if you can send some money back to knock the balance down or pay down the debt before you leave by selling stuff. No doubt I'll be told off for "encouraging" you to take on more debt!

These posts always cause people to chip in with emotion/unwanted advice/judgements etc.

But here's my take. I used to work in Asia - had a proper job. Met so many "backpacker types" passing through, doing working holidays etc. Very many of them ran out of cash and were relying on parents transferring money to them. They often asked me for "help" simply because I was British. Some got involved in drugs/illegal working. Some just had a miserable time - huge medical bills because they couldn't "afford" insurance, victims of scams because they hang out with the wrong types. Always the story was the same - bad luck, something "unexpected" happened. Of course others had a great time whilst paying their way. Don't want to be nasty, but your post suggests you might end up in the former category rather than the latter. Whilst you are here, you have more support (friends/family/job opportunities). When overseas you end up spending more (because you are foreign) and stuff doesn't always work out as you expect and there is nobody to dig you out.

So whatever you do about your present situation, do plan very carefully else there will be another digit (or two) on your debt woes.

Don80

Hi

Yes, absolutely tell your banks you are overseas, and give them the dates you will be away for. That's partly security (e.g. so they don't send new cards to an address you are not at) and partly so that if you needed to use your cards in Australia, the bank knows you're there and will allow the transactions to happen.

As for the cards, pay as much as you can before you leave, and make sure at least the minimum payments are made while you are away. You'd need to look into the most cost-effective way to pay money into your UK accounts and cards from Australia. Use online banking and set up balance alerts by email so you know you have enough money in the accounts.

Under no circumstances should you not make these payments. As others have said, of course it won't be wiped, and you'll end up with debt collectors and CCJs which will not be nice to come home to. Also, in some cases when you open an account overseas you need to get a bankers reference from your bank here. If they report that, you'll have trouble opening accounts in Australia too.

Someone posted something useful, if you're in Australia, you won't need the car. So sell it and pay off the cards before you go.

MEM62

MJS1991 wrote: »

Is my best bet explaining the situation to my bank and coming to some sort of agreement to continue to pay something?

No, your best bet is to travel when you can afford it. If you are facing the choice of travelling or clearing your debt then you clearly cannot afford to travel. Simples! :-)