Repayment Advice Please?

FurryFelines

Hi, I recently got a letter from credit card company about increasing my payments despite allways paying at least the minimum payment, always before the due date, they are threatening to stop the card even though I have not used the card for years. I am worried that if they do anything like that it will affect my credit rating or something, plus it doesn't make sense to me that they are making money off my debt yet they want me to pay it off quicker:think:? I don't know much about credit cards or how they work or how to pay them off. Would making weekly payments of £10 or £20 in addition to the minimum payments pay off my debt and lower my interest quicker or is this the wrong way to approach paying off my debt but keeping my card?

TadleyBaggie

It's all to do with the FCA introducing new rules to get long term debt reduced:

https://www.fca.org.uk/news/press-releases/new-credit-card-rules-introduced-fca

Would making weekly payments of £10 or £20 in addition to the minimum payments pay off my debt and lower my interest quicker

In short yes.

pecuniam_hominem

You are being a bit vague about your circumstances, but I would suggest you pay off more than the minimum payment if you can. If you just pay the minimum, a significant chunk of that will be interest.

Do you know the interest on the card? What kind of balance are you carrying?

If the card is paying interest, try move it using a balance transfer offer. Plenty of information on the main website about balance transfers. *Never* pay interest unless you can help it.

They would only send you letters to stop the card if you are not paying on time. Are you positive you are making at least the minimum payments every month?

EDIT: The above posters also refers to the new rules RE persistant debt. They clearly feel you are not reducing your debt at all.

T-G-C

It will not have an adverse effect on your credit file directly, although assuming said account has been in continuous debt for some time, this in itself, along with only paying the minimum, is not a positive thing for lenders to see. It demonstrates financial stress, which can cause affordability checks to fail among other things.

You should either start making the increased minimum payments and continue as such, even if the card becomes disabled, the lender cannot force the full amount, as per the credit agreement or make the new minimum plus extra each week, as said, to clear the balance faster and fall out of the new rules' demographic, meaning no disabled card and less debt to concern over.