Credit Card Interest

zmblake

Need some advice, got myself into a bit of a mess with credit cards. Basically I have 4 with the following balances -

MBNA - £1300
Barclaycard - £2250
Lloyds - £750
Capital - £300

I'm struggling to pay them all as I also have 2 loans (Avante and Likely Loans) plus my household bills. Would I be able to write to the credit card companies and say that I am struggling and would they freeze my account and not add interest to my cards for a period of 6 months for example so I can try and get myself a little bit back on track?

I was looking for a loan of £5,000 however my credit rating is shot so there is no hope there, I can't actually afford to live at the moment ie buy food, petrol so need to do something. I realise that I've been silly and am trying to get myself out of debt.

[Deleted User]

Yes, you can ask. If they agree, it will be marked accordingly on your credit file - eg a default or AP.

Willing2Learn

Hi,

If it were me, I would send all my creditor a letter to hold action and freeze interest, while you seek advice.

I suggest you contact StepChange or one of the other free debt counselling services. Do not pay someone for a service you can get for free.

Sample letter - Hold action on your account

sourcrates

zmblake wrote: »

Need some advice, got myself into a bit of a mess with credit cards. Basically I have 4 with the following balances -

MBNA - £1300
Barclaycard - £2250
Lloyds - £750
Capital - £300

I'm struggling to pay them all as I also have 2 loans (Avante and Likely Loans) plus my household bills. Would I be able to write to the credit card companies and say that I am struggling and would they freeze my account and not add interest to my cards for a period of 6 months for example so I can try and get myself a little bit back on track?

I was looking for a loan of £5,000 however my credit rating is shot so there is no hope there, I can't actually afford to live at the moment ie buy food, petrol so need to do something. I realise that I've been silly and am trying to get myself out of debt.

Hi,


You really need to get out of the credit bubble.


Further borrowing is not the answer to getting out of debt, you most likely need some kind of debt management, this works by working out a budget you can live on, then any surplus income goes towards repaying your debts.

You can do this yourself, or go through one of the free to use debt charities such as stepchange, you make one monthly payment to them, they then distribute that payment between your creditors, so you repay what you owe, but over a longer period of time.

You also have to be pro-active as well, you would write to each creditor explaining your situation, and asking them to stop all interest and charges, they do not have to, but they must treat you fairly, so usually they will do in the end.

Get further advice from stepchange.

zmblake

Many thanks for your reply, I realise I need to get out of the cycle.

I really do not want to go down the route of a DMP as defaults will hit my credit file and currently I have none. It will ruin our chances of getting a mortgage for 6 yrs at least - shared ownership will not even touch you if you have a default on your credit file unfortunately.

I need to discuss with my husband and see what we can do..

sourcrates

zmblake wrote: »

Many thanks for your reply, I realise I need to get out of the cycle.

I really do not want to go down the route of a DMP as defaults will hit my credit file and currently I have none. It will ruin our chances of getting a mortgage for 6 yrs at least - shared ownership will not even touch you if you have a default on your credit file unfortunately.

I need to discuss with my husband and see what we can do..

On paper your debts are not massive, i would really want to discourage you from consolidation, it rarely works, and nearly always doubles your debt, if you want to avoid debt management, you need to decrease costs, and increase your income if possible, pay down your existing credit quicker.

zmblake

Unfortunately I can't up my income, I'm work part-time and on quite good money (work 25 hrs a week for £21k a year.). I work 9am - 2pm, Monday to Friday. I have 2 young boys so drop them at school and pick them up, if I worked full-time, anything I gained would be spent on afterschool childcare not to mention the extra money during school holidays.

I have tried this facebook things selling like Nu-Skin and another one however as I'm not into posting selfies using all the products all over facebook and annoying friends that didn't work out.

I did use to work 30 hrs a week however found that I was ill from trying to do too much (so ended up taking more time off sick from work which wasn't good for work or me or my family).

Will be thinking hard now, if I can do anything else at home to increase my income.

Willing2Learn

Hi,

Why not post your SOA (Statement of Affairs)? That way, people here can give useful advice on where and how you can save money. If you do choose to post, please remember to click on the 'Format for MSE' button at the bottom of the form. Thanks

http://www.stoozing.com/calculator/soa.php

TriggerHappy

Hi Op,

I agree with the above in general. You need to get out of the credit bubble and borrowing more to clear your balances is a bad idea, especially as there's four credit cards - all you'll likely do is wind up using them again, it's a classic pattern.

Between yourself and your husband, would you say that you generally tend to indulge in things you don't need? Or maybe just pay too much for convenience? I'd say post an SOA and let people offer a few pointers because you might be able to save a wedge just by cutting back in areas.

Also, this will sound like a silly question, do you have any savings? I ask because some people sit on a pot of cash which is for emergencies while not realising that they're in an emergency but it's unfolding slowly around them...

Good luck!

macman

Being realistic, unless you already have savings, are you really going to be in a position to have saved enough for a house deposit within 6 years? At present your focus should be to service your priority bills and debts: rent, council tax, utilities, secured loans.
If you are going to end up defaulting anyway, isn't it better to happen now and then have them drop off your credit history in 2024?