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eng1991

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foxy-stoat

Forget about your score.

How much do you pay each month and how much interest is added?

Are you spending on the cards?

What have you bought for £8,200 or was it general spending?

[Deleted User]

You'll also need to consider your income, as total borrowing of 15k may be a stretch, depending on your wider finances.

MallyGirl

If you can get a loan for the amount at a lower rate than you are paying on the cars and,
if you have addressed the overspending/whatever that filled the cards in the first place and,
if you have the self control to keep paying what you were before rather than using the loan as an excuse to ease off on the debt repayment and,
if you won't immediately start filling the empty cards again then

it can be the way to get debt shifted faster.
You have to remember that are not clearing the credit card debt, you are moving it to better terms.

nic_c

I'd ask what the APR is of each card, and how it was accrued, and what you paying each month.

A loan should be better if you can afford repay as it will be more than the minimum that each card are asking for now. Depending what else is on your credit file you may not get a great offer (but even a loan at 10-15% is better than cards at 20%+.

The question of how it was accrued is important as if it was general living costs then how are you going to avoid running up new balances on your CC when you have the loan (This is the biggest problem when people look to pay off credit cards with loans, they forget that they will have less money because of the loan repayments and then start using the CC again and run up balances).

If you have not made credit applications in the last 6 months pref a year then one application won't harm. Of course who you apply to may depend on how good your credit file is. Some will offer an APR and reject you if you don't qualify for that or maybe a slightly higher one, others have a higher acceptance rate but the APR range varies i.e. they may say "typical APR 4%" but accept you but offer 17%. This may need to be taken into account too.

[Deleted User]

You still have the issue of affordability, coupled with being almost maxed out on your current borrowing.

foxy-stoat

How much are you currently paying back?

foxy-stoat

eng1991 wrote: »

When you say maxed out on current borrowing, if I was to put the £7000 to use by clearing the credit card of £5500 and then £1500 on the other. I would only owe £1200 on 1 credit card and £0 on the other.


Therefore how do you mean maxed out?

You are £1000 off 1 card limit and £300 away from the other limit = nearly maxed out.

YorkshireBoy

Why would you not want to try and shift the debt to 0% BT cards?

YorkshireBoy

eng1991 wrote: »

Yeah but I'm thinking of getting the loan to clear these credit cards. So therefore after getting the loan and paying off the credit cards I would be no where near maxed out? I would then simply just have to pay the monthly loan payment, no?

Lenders won't see it that way. And nor will you because people will ask to borrow money again. And you might fancy another holiday. Both of which you could do because you'll have loads of available credit on the two empty cards.

foxy-stoat

eng1991 wrote: »

Yeah but I'm thinking of getting the loan to clear these credit cards. So therefore after getting the loan and paying off the credit cards I would be no where near maxed out? I would then simply just have to pay the monthly loan payment, no?

You are currently nearly maxed out.

You currently have borrowing of £8,200 and you want to apply for £7,000 - any lender will assess your new debt to be £15,000 - so you need income of at least £30,000 a year. Your better off applying for what you actually need to clear your cards and then cancelling them - if you can....or trying to get another card with a 0% balance transfer deal and shuffle the debt that way.

You won't get a debt consolidation loan at the lowest rate - maybe into double figures if at all.

What are you currently paying each month on your credit cards ? (for the third time)