Should I change my approach?

chelseablue

Currently have 3 debts that I am in the process of paying off (was 4 but I paid one off last week and closed the account :T)

Credit card 1: Balance £4,000
Credit card 2: Balance £4,500
Car loan: Balance £5,000

I'm 35 and never actually been in debt before but this year we've had 3 big things we've had to pay for (I did have £47,000 in savings 2 years ago but I used it all on the deposit for our house)

My initial plan was to pay it off starting with card 1 at £1,000 a month (while paying the minimum on card 2 and the loan) then move to card 2, then the loan.

This would see it all gone in 13 months

However with a young family and a house that needs work £1k a month would equal not much spare cash for doing anything. The state of my house is really starting to depress me!

So I was thinking of moving the 2 cards onto a 36 month 0% balance transfer card.

To make sure it was clear in 36 months I would need to set the DD at £240, but I'd round that up to £300 and it would be clear in 28 months.

Would then overpay the loan by £500 a month and that'll be gone next year

Would love to hear some wise words on what to do!

poppy10_2

What are the rates on the cards/loan?

chelseablue

poppy10 wrote: »

What are the rates on the cards/loan?

One card is actually 0% at the moment until next year

The other is 15.9%

The personal loan is 4.5%, payment of £136 a month

chelseablue

I did the eligibility checker on here and it says I have 100% chance of getting the Virgin Money credit card.

Its 0% on balance transfers for 30 months and 0% on money transfers for 30 months.

If I got a big enough credit limit I could do a money transfer into my current account and pay off the car loan.
Plus transfer my card debt onto it.

If I set the direct debit at £500 I would pay it off in 27 months (quicker if I send both our work bonuses to it)
Of course when the card arrived in the post I would cut it up

lindens

Have you used the snowball calculator (just google it). You plug in your figures including the rates and how much you want to pay. then play around with it and work out how you can pay it off the quickest/paying the least interest etc.

chelseablue

lindens wrote: »

Have you used the snowball calculator (just google it). You plug in your figures including the rates and how much you want to pay. then play around with it and work out how you can pay it off the quickest/paying the least interest etc.

Just did it
If I leave everything where it is and pay £500 a month it will take me 30 months to pay off and cost £900 in interest

Or if I get a big enough limit with virgin it will take 27 months and £0 interest (plus just the one creditor, one direct debit does appeal instead of owing 3 separate companies)

Dot.007

is it difficult to get virgin card?

enthusiasticsaver

What work needs doing on the house and have you estimated the costs?

I think I would go for the Virgin deal if you can get it.

chelseablue

enthusiasticsaver wrote: »

What work needs doing on the house and have you estimated the costs?

I think I would go for the Virgin deal if you can get it.

How long have you got :rotfl:

Driveway
Patio (currently very old decking that's rotten)
Re-turf some of back garden
A Fence (currently there is no fence between ours and our neighbours back garden :eek: and its the side we're responsible for)
New bathroom eventually
All 3 bedrooms did redoing, including flooring, curtains and light fittings (they look like they've not been touched in around 20 years)
Repaint hallway downstairs and upstairs and replace the threadbare carpet on the stairs and landing
Furniture (husband currently has no wardrobe just a £20 clothes rail from Argos, been that way since we moved in in 2016)
New sofas eventually

chelseablue

I've been accepted for the Virgin Money 30 months card.

To transfer 2 cards and loan to it I needed 14k credit limit but have been given 11k

That's fine though as I will be able to clear my 15% credit card and the loan and that will leave the Lloyds card which is 0% until 2020 anyway.

I will pay £500 a month off the Lloyds card until its paid off (Jan 2019) while doing minimum to Virgin

Then £500 to Virgin from January

Clearing the loan will mean cancelling the £136 monthly direct debit, plus from September will be £220 a month better off due to no more nursery fees so £500 a month is very doable (may even be able to buy curtains at last!)

sazaccount

Not that this helps with paying off the debt but have a look on local selling pages wardrobes and curtains sometimes come up