Question about new CC rules - persistent debt

emmamc77

So I see that the new CC rules kicked in yesterday.

I just wondered how this might affect someone like me. I am doing VERY well in clearing my debts. I started with a high balance and have used the snowball approach so far, throwing as much as possible at the highest interest rates.

This means that some of my debt is on Credit cards that are accruing interest. I am paying the minimums on these cards currently as they will be dealt with when their turn comes in the snowball!!

I don't want these CC providers to suddenly increase my monthly payment as this will mess up my schedule.

Would paying an additional £5 above the minimums prevent this??

I appreciate what the FCA are trying to do, but for me this just isn't helpful!!!

[Deleted User]

Yes - pay more than minimum.

emmamc77

Deleted_User wrote: »

Yes - pay more than minimum.

Thanks - I just wondered if there was a specific amount that I would need to pay over the minimums in order to avoid the new ruiles? I imagine that they will still apply to people who pay say £1 over the minimum??

Jeaniekins

Keep chipping away at the balances, just a little over that minimum amountmakes a difference. I understand it to mean anyone that has paid no more than the minimum required for at least 18 months should be contacted and asked to increase, or they may suggest cancelling card and transferring the balance to a loan. It was also to prevent those set up on minimum payment direct debits- so you might be paying eg £35.56 minimum this month but that will go down very slightly each month. They want to encourage you round it up a bit and stick to that same payment, rather than let it reduce each month. That makes sense to me cos if you can pay that amount this month, it should (not always possible I know) be able to do that every month.

sourcrates

Hi,


There are time limits applied to each stage, first two stages are just warnings, 18 months +, 27 months +, at the third stage 36 months + lenders must offer customers a reasonable way to repay their balance.


If customers are unable to pay, the FCA says the firm must show 'forbearance' and may have to reduce, waive or cancel any interest, fees or charges.


There are no hard and fast rules over when a customer's card may be cancelled, but it could happen if after 36 months the customer isn't making faster repayments, they fail to keep up their repayment plan or they say the repayments aren't possible.

emmamc77

sourcrates wrote: »

Hi,


There are time limits applied to each stage, first two stages are just warnings, 18 months +, 27 months +, at the third stage 36 months + lenders must offer customers a reasonable way to repay their balance.


If customers are unable to pay, the FCA says the firm must show 'forbearance' and may have to reduce, waive or cancel any interest, fees or charges.


There are no hard and fast rules over when a customer's card may be cancelled, but it could happen if after 36 months the customer isn't making faster repayments, they fail to keep up their repayment plan or they say the repayments aren't possible.

Thanks Sourcrates.

So does that mean that the 18 months starts from now, or is it retrospective?

sourcrates

emmamc77 wrote: »

Thanks Sourcrates.

So does that mean that the 18 months starts from now, or is it retrospective?

They had until Sept 1st to fully implement, so i would say Sept 1st, but it may be open to interpretation by creditors.