More persistent debt

Dandytf

Todays e-mail cap1 267 to be paid by March.
Could make it , going to be difficult.
Alternative idea is use one mortgage overpayment which covers extra payment.
Is this a decent idea as i only have almost four overpayments total reserved.
Originally slowly saved keeping future rate rises in mind.

Ben8282

Not sure about the logic of overpaying your mortgage when you are in a persistent debt situation with Capital One at what must be a much higher interest rate, but if you are saying that you have made four overpayments to your mortgage and are therefore allowed four 'payment holidays' on the mortgage, then yes it is a very good idea indeed.
Don't really understand the reference to savings but if you have any use them to repay Capital One.

[Deleted User]

As per the normal advice given to you;

Stop applying for more credit and clear your existing debts first

Dandytf

Ben8282 wrote: »

Not sure about the logic of overpaying your mortgage when you are in a persistent debt situation with Capital One at what must be a much higher interest rate, but if you are saying that you have made four overpayments to your mortgage and are therefore allowed four 'payment holidays' on the mortgage, then yes it is a very good idea indeed.
Don't rally understand the reference to savings but if you have any use them to repay Capital One.

Yes 4 overpayments held in reserve- non cash withdrawal.
Can cancel mortgage standing order which means I wouldn't be debited mortgage payment from bank that month
Mortgage payment amount wold be taken from reserve.
Any savings i have are aimed towards similar rules from aqua- mainly years 1+2 total from help2save from march/April next year.
Purpose being avoid any negative effects of persistent debt rules
Avoid any forced larger re payments
Avoid total credit card balances being split over 4 years
Continue to maintain consistent debt re payments on time.
In effect i want to save what could become a decent credit history again 2-3 years.

These FCA new rules are they trying to achieve zero credit card balances for everyone who has re paid more in interest over 3 yers when compared to what has been debited from balance.
Are FCA calling in the u.k.'s trillions in unsecured lending

Thanks

Dandytf

!!! wrote: »

As per the normal advice given to you;

Stop applying for more credit and clear your existing debts first

Thanks on a more positive note non CC'

Monthly repayment amount
£55.17
1 payments remaining

Terry_Towelling

Are you saying that your mortgage overpayments go into a reserve account that offsets mortgage interest and that you can only access that reserve cash to pay your mortgage?

If that is so, you might want to take as many payment holidays as you can and get your cards cleared. I understand you might be viewing the reserve as some sort of safety net in the event you are short of cash one month, but you would probably be better off getting your cards cleared and using the freed-up available credit as a your safety net. Your cards are costing you a fortune but your mortgage isn't.

Just look at all the CC interest you've been paying over the months, add it all up and imagine what you could be doing if you hadn't been incurring that in the first place. That could be money in your pocket rather than that of your CC provider.

Dandytf

Thanks TerryT
That does describe my mere almost four mortgage overpayments held in reserve.
I'm not comfortable with the idea of using the reserve amount immediately.
Prefer to consider I could have at least 3months safety net considering I was once unemployed for a few weeks and my then 1 overpayment saved a lot of worry.

I'll probably use at least 1 month early next year though I don't mind attempting to try and save it myself , though probably too soon for March.

A4445

I don’t understand why you have to pay the money back to Cap1 by March? Doesn’t seem fair to force a payment.

Terry_Towelling

If you were to use some of your reserve to pay the mortgage one month, would you then be allowed to top up your reserve back to the equivalent of 4 overpayments?

fatbelly

Dandytf wrote: »

These FCA new rules are they trying to achieve zero credit card balances for everyone who has re paid more in interest over 3 yers when compared to what has been debited from balance.
Are FCA calling in the u.k.'s trillions in unsecured lending

Thanks

A4445 wrote: »

I don’t understand why you have to pay the money back to Cap1 by March? Doesn’t seem fair to force a payment.

The FCA rules are not clearly thought through.

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

The lenders are required to identify people who have spent 18 months paying more in interest and charges than debt repayment and then within a further 18 moths, offer them 'something' to help them.

So in practice you will probably get 18 months of stupid letters before they do something.

Debt camel has some guidance

https://debtcamel.co.uk/credit-card-pay-more/

Dandytf

A4445 wrote: »

I don’t understand why you have to pay the money back to Cap1 by March? Doesn’t seem fair to force a payment.

Paying off your balance faster
Between now and 1 March 20​20, you'll need to pay an extra £267 off your account to help avoid the steps we might have to take later on.
You can do this by making a lump sum payment, or by splitting the amount over payments between now and 1 March. You can make the extra payments in the same way you do now (through the app, online or by phone).
Remember, you'll still need to pay your minimum monthly payment as usual