Snowballing advice

Cat4321

Statement of Affairs and Personal Balance Sheet

Household Information
Number of adults in household........... 2
Number of children in household......... 2
Number of cars owned.................... 2

Monthly Income Details
Monthly income after tax................ 1700
Partners monthly income after tax....... 808
Benefits................................ 137.6
Other income............................ 300
Total monthly income.................... 2945.6

Monthly Expense Details
Mortgage................................ 808
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 193
Electricity............................. 45.92
Gas..................................... 5
Oil..................................... 45.83
Water rates............................. 43.5
Telephone (land line)................... 47
Mobile phone............................ 58
TV Licence.............................. 12.83
Satellite/Cable TV...................... 0
Internet Services....................... 0
Groceries etc. ......................... 320
Clothing................................ 10
Petrol/diesel........................... 180
Road tax................................ 41.2
Car Insurance........................... 62.69
Car maintenance (including MOT)......... 50
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 54
Other child related expenses............ 40
Medical (prescriptions, dentist etc).... 18
Pet insurance/vet bills................. 0
Buildings insurance..................... 14.48
Contents insurance...................... 0
Life assurance ......................... 73
Other insurance......................... 25.09
Presents (birthday, christmas etc)...... 52.92
Haircuts................................ 35
Entertainment........................... 50.79
Holiday................................. 30
Emergency fund.......................... 40
Parents treat .......................... 25
Expense................................. 26.83
Children savings ....................... 20
Total monthly expenses.................. 2428.08


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 3000
Other assets............................ 2000
Total Assets............................ 5000


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 178000...(808)......3.49
Total secured & HP debts...... 178000....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Tesco M........................7689.06...79.99.....0
Halifax F......................1906.24...19.06.....0
Mbna F.........................4386.24...43.86.....0
Tesco F........................6328.99...76........0
Mbna m.........................3959.48...39.59.....0
Lloyd’s M......................5399.8....54........0
Lloyd’s F......................2507.05...25.07.....0
Total unsecured debts..........32176.86..337.57....-


Monthly Budget Summary
Total monthly income.................... 2,945.6
Expenses (including HP & secured debts). 2,428.08
Available for debt repayments........... 517.52
Monthly UNsecured debt repayments....... 337.57
Amount left after debt repayments....... 179.95

Personal Balance Sheet Summary
Total assets (things you own)........... 5,000
Total HP & Secured debt................. -178,000
Total Unsecured debt.................... -32,176.86
Net Assets.............................. -205,176.86

Cat4321

Hi I’ve now used the snowball calculator and it is saying to pay off Tesco M first.

Just wanted peoples advice as our mortgage will be up for renewal in July and I want to try and get our credit ratings up.

On clear score mine is 483 and my husbands is 463.

We have to move a couple of cards to a 0% card (that we already have) with no current balance and high credit limit and thinking that will negatively impact on our credit rating.

Also a few of our cards are near their max. Therefore I’m wondering if we should try and pay money off of those first so we’re not near max limit to improve credit rating (to try get better mortgage deal) or to go with what the snowball calculator says? Thanks in advance

monetxchange

Many on here will tell you that credit ratings (as in the number) are meaningless and lenders don’t look at them. Focus on the debt for now, what’s done is done in terms of shaky credit history.

I’d be inclined to go with what the snowball calculator says and it’ll save you interest and help you clear debt quicker. That will also bring your overall credit utilisation down too.

I like ClearScore, but have noticed their credit utilisation section on mine still tells me I’m close to limit/over 50% when I’m nowhere near. So make sure you know how much you owe on an up to date basis and not always go by what ClearScore says. They’re often up to 6 weeks out of date.

monetxchange

Did you put the correct APRs in the snowball calculator? They’re all showing as 0% on the SOA, which you’ve stated isn’t the case. It might skew the results of the info is not all accurate.

Cat4321

Thank you yes it’s just part of / cards are coming to the end mid jan so need to move a bit around about 1.5k, thanks for your advice. I might try a different credit score company and see what they say. Yes unfortunately about 3 cards are very close to their limit hence the dilemma, thanks I’ll have a think.

monetxchange

I don’t think it’s an issue with ClearScore itself. It’s just that the number is to an extent made up for your benefit. As an example, I’m something like 580 out of 700 on ClearScore, but 999 out of 999 on Experian, so it shows there’s no real criterion for how they work out the number.

I’m not an expert, but lenders I think look at credit history and how much you’ve taken on versus your income. So it’s good to start getting the debt down, but I don’t think there’s anyway to “trick” the system by moving money around to make it seem like you owe less on certain cards. If you have say a total of £20k of credit available across all cards and you’re using £19k, it doesn’t really matter if it’s less close to the credit limit on one card than the other if you see what I mean. It’s about getting the snowball rolling and paying the debt off as a while as quickly as possible 😊

Cat4321

Thank you I will crack on with that then, yes hoping it will all work out this month feel a little anxious whether it’ll work!!

datlex

The snowball calculator will always tell you to pay off the biggest debt first. You have not said when your 0% offers end on any of the cards. You might be better off paying off the three smaller cards rather than paying off the large one. It will take you more or less as long and it should look good to a lender that you have paid off cards if you need to extend the 0% on any.

Cat4321

Thank you I’ll have a chat with my husband and think about all the advice thank you

Willing2Learn

Cat4321 wrote: »

Thank you I’ll have a chat with my husband and think about all the advice thank you

When you do that, you might as well discuss the two differing snowball methods, deciding which one you prefer.

You either make payments in order of APR or in order of the amount due.

The two methods are fully explained in the article linked below:
https://www.thebalance.com/debt-snowball-vs-debt-stacking-453633

I recommend you use the snowball calculator linked below, as it can calculate repayments using both methods. That way you would see the full picture
http://www.whatsthecost.com/snowball.aspx

getmore4less

A proper snowball calculator will not be biggest first.
It will also take account of when 0% end
Also fees for new deals

I don't think anyone has done one yet that can cope with everything needed.

You need the APR for the debts and when any promo run out.