How best to clear CC debt?

renard_2

I am extremely grateful for your detailed advice, Yorkshire Boy. :T

YorkshireBoy wrote: »

LOB is an abbreviation for a 'Life Of Balance' card. These low rate APR cards are alternatives to constant 0% rate tarting and can be useful for long-term debt reduction planning since you avoid the worry (and cost, in the form of the now more prevalent BT fees) of finding new 0% deals every 6/9/12 months or so.

So, if she telephoned her CC company to discuss the possibility of transferring to an LOB, would they understand what she meant? And do you know if this is a service other companies might offer, or would she be wasting her time enquiring elsewhere? Profit seems to be their motive, so I'm amazed at the notion that they might let her pay off the balance at a lower APR - but, as I said previously, this is a whole new world to me and I'm learning as I go along.

Thanks again.

YorkshireBoy

renard wrote: »

I am extremely grateful for your detailed advice, Yorkshire Boy. :T

You're very welcome.

So, if she telephoned her CC company to discuss the possibility of transferring to an LOB, would they understand what she meant?

It's highly unlikely that her existing card would offer a life of balance deal for debt already with them. After all, at the moment she is their ideal customer...a 'revolver' only ever making the minimum payment. Until she experiences difficulty making payments they are unlikely to offer anything in the way of help. Moreover, if she comes clean on her situation she may actually 'spook' them into increasing the rate!

And do you know if this is a service other companies might offer, or would she be wasting her time enquiring elsewhere? Profit seems to be their motive, so I'm amazed at the notion that they might let her pay off the balance at a lower APR...

Providers offer these deals in the hope that you subsequently spend (ie make purchases) further amounts. Most credit cards' 'order of payment' structures mean these new purchases stay locked in at circa 16.9% APR+ until you completely clear the lower APR life of balance amount originally transferred.

However, she probably shouldn't apply for any more cards until she's taken a look at her credit file. In case her partner goes on an 'application spree', it may also be a good idea to order (£2) reports monthly for a while because he could damage her rating further by his actions (when/if he is searched for credit, your daughter's file will also be searched as an 'associate', which she'll be able to see).


To be honest though, it sounds like the credit card debt is only part of your daughters problems at the moment. She needs to develop a plan to address all issues...financial separation (pending divorce), the endowment issue, etc. Talking of the endowment, if this is a joint policy won't she need her partners consent to sell? And you don't know where he is? Maybe she needs a 30 minute free consultation (or two) with a family solicitor?

renard_2

Many thanks for yet more useful advice, Yorkshire Boy.

YorkshireBoy wrote: »

To be honest though, it sounds like the credit card debt is only part of your daughters problems at the moment. She needs to develop a plan to address all issues...financial separation (pending divorce), the endowment issue, etc. Talking of the endowment, if this is a joint policy won't she need her partners consent to sell? And you don't know where he is? Maybe she needs a 30 minute free consultation (or two) with a family solicitor?

This is all wise counselling, thank you . Fortunately, the endowment is in her name only. And, thanks for the suggestion, she does have a solicitor working on the divorce issues, including eventual financial separation. But for the present she is struggling to pay everything, including the credit card debt, which was the purpose of my original posting - I was hoping to find some way of easing her burden in this respect, now.

Providers offer these deals in the hope that you subsequently spend (ie make purchases) further amounts. Most credit cards' 'order of payment' structures mean these new purchases stay locked in at circa 16.9% APR+ until you completely clear the lower APR life of balance amount originally transferred.

So, there seems little purpose in her trying to get a LOB card. As Martin Lewis says elsewhere, we have to remember that banks exist to make money, not to help people! Or, as the old saying goes: "A bank offers you an umbrella when the sun is shining, but quickly takes it back when it starts to rain".

The responses to my post have been very useful and I am most grateful to everyone.