Halifax Persistent Debt

makeni555

Hello,

I've read the threads on persistent debt but I'm confused as to whether the persistent debit applies here.

A Halifax card with a balance £3k and interest rate of 6% means we're paying off at around £45 pcm including £15 of interest (approx).

Its just been on the minimum for around 8 years (1%+Interest)

Do the persistence debt rules apply to us as we're paying more each month in balance than in interest added but we are only doing the minimum?

Just want to know so I can prepare to budget more to the card if the Halifax get in touch as it'll be around 30 Years to clear it otherwise.

Thank you

stevenhp1987

30 years to clear a debt?

That sounds more than persistent to me!

Is there any reason you cannot (or are not) pay more than you currently are? 30 years to pay something off is an extraordinary long time!

SnowTiger

makeni555 wrote: »

I've read the threads on persistent debt but I'm confused as to whether the persistent debit applies here.

A Halifax card with a balance £3k and interest rate of 6% means we're paying off at around £45 pcm including £15 of interest (approx).

Its just been on the minimum for around 8 years (1%+Interest)

Do the persistence debt rules apply to us as we're paying more each month in balance than in interest added but we are only doing the minimum?

Just want to know so I can prepare to budget more to the card if the Halifax get in touch as it'll be around 30 Years to clear it otherwise.

Thank you

Technically, according to the FCA, you are not in persistent debt.

They define persistent debt as "where over a period of 18 months, a customer pays more in interest, fees and charges than they have repaid of the principal."

You are clearly paying more towards the principle (the debt) than towards interest (and charges). About twice as much.

However, it seems pretty persistent to me.

If I were you I'd continue to pay at least £45 a month, even though the minimum payment will reduce over time.

makeni555

Hi Snowtiger

Thank you for the clear explanation - much appreciated. I'll pass on the advice to fix the payments as they are at now as well.

Thank you


Hi Stephenhp1987 - Its not my debt to clear. But I do agree, thanks

Ergates

makeni555 wrote: »

Hello,

I've read the threads on persistent debt but I'm confused as to whether the persistent debit applies here.

A Halifax card with a balance £3k and interest rate of 6% means we're paying off at around £45 pcm including £15 of interest (approx).

Its just been on the minimum for around 8 years (1%+Interest)

Do the persistence debt rules apply to us as we're paying more each month in balance than in interest added but we are only doing the minimum?

Just want to know so I can prepare to budget more to the card if the Halifax get in touch as it'll be around 30 Years to clear it otherwise.

Thank you

I calculate it as about £20 of interest a month, but still - you're not in persistent debt.