Should I get a loan to fix my issue

Poecile

So long story short I am a:
-University Graduate
-New job (first month in position at 1500 a month until April which will then go to 1300, this is something to do with the tax year? But I am on 18k a year)
-Spent 2 last summers working at a summer camp in NY which was a big reason of the debt
-Used to have terrible money management due to gambling instability ( this has been fixed for a year or so now so no worries on that front)

So essentially just started my first career job and I am looking to just clear my debt as efficiently as possible and need to know the best way to go about it.

I currently need to pay the following:
£103 Car Payment (3.5K Left on 3.2% APR Hitachin Finance)
£111 Car Insurance
£195 Amigo Loan (49.9% APR, Ouch, This is for £4000 over 36 Months)
£100 Minimum payment on my BarclayCard (19.7%APR, £3500 is the limit and it is maxed)
£100 rent a month
2 x Lending Stream payday loans which were used for my car tests/petrol and insurance deposit of £364 (The Lending Stream payments needed to clear of debts are £564 or 154 Per month for one and 88 per month for the other going up to 6 months (Which is a lot of money )
£115 owed to my Aunt
£190 owed to my Grandmother
£60 a month speeding ticket (£280 in total)
£1100 overdraft ( I get charged £30 a month for this)

I know this is a lot of debt hence why I am trying to figure out the best way to clear it, I cannot stress enough of how aware I am of my current situation so I have not came here for an uneducated rant just looking for advice to get my life back on track from people more financially minded than myself. I get paid on the last Friday of every month so my next pay will be the 30th and due to Christmas my following pay after wards will be the 21st.

I considered trying to expand my Amigo loan to 6k over 36months to pay off my speeding ticket, my family debts and my Lending Stream/Overdraft which would yes make my monthly payments higher but allow me to concentrate on the 2 main bills (Amigo and Barclaycard)

Thoughts?

Ilona

Hi. The first thing to do is go to the Debt Free Wannabe board, find the link to the Statement of Affairs, fill it all in and post it up, money in - money out, then lots of people will give you ideas on how to cut back your spending so you have more cash to pay off the debts.

Borrowing more very rarely works, you will be just moving it about.

ilona

Pixie5740

Poecile wrote: »

So long story short I am a:
-University Graduate
-New job (first month in position at 1500 a month until April which will then go to 1300, this is something to do with the tax year? But I am on 18k a year)
-Spent 2 last summers working at a summer camp in NY which was a big reason of the debt
-Used to have terrible money management due to gambling instability ( this has been fixed for a year or so now so no worries on that front)

So essentially just started my first career job and I am looking to just clear my debt as efficiently as possible and need to know the best way to go about it.

I currently need to pay the following:
£103 Car Payment (3.5K Left on 3.2% APR Hitachin Finance)
£111 Car Insurance
£195 Amigo Loan (49.9% APR, Ouch, This is for £4000 over 36 Months)
£100 Minimum payment on my BarclayCard (19.7%APR, £3500 is the limit and it is maxed)
£100 rent a month
2 x Lending Stream payday loans which were used for my car tests/petrol and insurance deposit of £364 (The Lending Stream payments needed to clear of debts are £564 or 154 Per month for one and 88 per month for the other going up to 6 months (Which is a lot of money )
£115 owed to my Aunt
£190 owed to my Grandmother
£60 a month speeding ticket (£280 in total)
£1100 overdraft ( I get charged £30 a month for this)

I know this is a lot of debt hence why I am trying to figure out the best way to clear it, I cannot stress enough of how aware I am of my current situation so I have not came here for an uneducated rant just looking for advice to get my life back on track from people more financially minded than myself. I get paid on the last Friday of every month so my next pay will be the 30th and due to Christmas my following pay after wards will be the 21st.

I considered trying to expand my Amigo loan to 6k over 36months to pay off my speeding ticket, my family debts and my Lending Stream/Overdraft which would yes make my monthly payments higher but allow me to concentrate on the 2 main bills (Amigo and Barclaycard)

Thoughts?

You cannot borrow your way out of debt. Extending the Amigo loan is a particularly terrible idea because when you can't pay they can and will go after the guarantor.

My advice is to put together an honest statement of affairs and post on the Debt Free Wannabe board not the Loans board.

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

AstroTurtle

Do you have a current account that is a graduate account? Some of the banks do Graduate Loans that likely to be much lower APR's than Amigo or Credit cards.

If so try to reduce your borrowing by snowballing.

Fireflyaway

I've been in a similar situation to you and I got a consolidation loan. Worse thing I did! It's just moving the debt about. Looking at your debts, there are some little ones you could deal with quite quick.
I'd be looking to follow the dave Ramsey method. List your debts smallest to largest and tackle them in that order. Being able to cross off one at a time allows you to see the progress and motivates you to keep going.
Do a written budget so you can make a plan.

[Deleted User]

Fireflyaway wrote: »

List your debts smallest to largest and tackle them in that order. Being able to cross off one at a time allows you to see the progress and motivates you to keep going.

Definitely not to be recommended.

The largest debt is Amigo at 50%. This needs to be tackled long before the 3.2% car loan.

enthusiasticsaver

As I said on your other thread. No you should not get another loan. It will not help you and will make it much worse. Presumably there is no interest on your speeding ticket or family debt and amigo loans are charging you criminally high interest rate so this will make it much more expensive. Do you have a guarantor for your current Amigo loan?

MEM62

My initial thoughts;

You cannot borrow your way out of debt. You need to post an SOA to get proper advice from the members here.

Please do not stitch up the guarantor for your Amigo loan further by more borrowing.

You will receive great advice on dealing with your debt once you have post your SOA but you really need to work on your relationship with money and understanding how to fund life's expenses properly. Payday loans for car tests and insurance deposits is madness. Unless you address this you will only end up back in the same situation at some future point - perhaps even in the near future.

redux

If it's possible to find another loan at lower rate than Lending Stream and Amigo then do that and pay those off early. If not, at that high rate every spare pound you can send to Amigo now saves £5 or £6 by 3 years from now. And Lending Stream is even worse rate. Once Lending Stream is paid off you can step up the Amigo repayment.

Improve your driving, particularly attention to speed limits. There is not only the cost of the fine(s), but the insurance premium won't start dropping off in price if you have more offences, let alone the risk of a ban.

dawyldthing

That is bonkers. You know on the car insurance you’ll be paying more as you’re paying monthly? You need to get rid of the car as it’s costing you £220 that’s before petrol and tax and car problems. Then pay it off your highest one.

For your tax next year go to listentotaxman.com and type in your salary. It will show you what you’ll come out with.

Don’t get a loan to consolidate it. It won’t help. Can you get a weekend job while around Christmas time as that could pay a fair bit off?

You’ll not be touching the debt on the Barclay card for one as that will be the interest. But you need to prioritise the highest interest first.

Be careful with the speeding too. If you get points on your licence that will mean a higher insurance too.

Other thing is possibly ask aunt and gran to see if you can pay half back for a year as your trying to pay bits back and then use it on the higher cost stuff.

You’ll struggle to get a bigger loan as you’ve had lending stream and amigo which won’t look good.

Other thing is to cut back on your every day expenses. Cut everything out unncessary and possibly buy minimum for Xmas. You need to get it paid off as the interest you must be paying is eye watering (possibly as much as your salary I’d guess)

Herzlos

If you've just graduated and started a job you're not going to be in any position to borrow at a good rate. With the debts you've got and the Lending stream loan you're really not going to get a good deal.

Focus on the most expensive stuff first, Lending Stream, then Amigo, then Barclaycard. As your payments go down, use the saved money to overpay on the most expensive.


I'd try and pay the relatives back as a priority too, since you want to keep up a good relationship with them.


Then look at what you're spending and what you need to. You're paying a fortune for the car - do you need it? Can you trim down your mobile phone plan? Got anything you're not using that you can sell?


As said, any £1 you can put towards the most expensive stuff will save you a lot by the time you're done.