Advice needed please.

edited 30 November -1 at 1:00AM in Credit Cards
8 replies 652 views
Vastsarah5Vastsarah5 Forumite
5 Posts
edited 30 November -1 at 1:00AM in Credit Cards
Good Afternoon, I have only just come back to MSE after realizing i'm still in the same debt as i was at 40, i have only been paying the minimum payments. Im now 52 and working full time, family have grown and DH earning more.

DH has 3 Credit Cards which he is paying about £40/each/month interest on. We are hoping to move all 3 amounts to a Lloyds CC which we have available. The total amount is £7980.00.

Which would be best?

0% interest p.a over 12 months with 3% fee.
or
4.9% interest p.a over 36 months 0% fee.

We could not clear this in 12 months but could possibly have CC to move again.

Thank you for reading , Sarah

Replies

  • Willing2LearnWilling2Learn Forumite
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    Hi,

    The first option costs you less in interest. This could be the better option if you can get another 0% promotion after the initial 12 months is unknown.

    If you accepted the 36 month option instead, would that be enough time to clear the debt?
    I work within the voluntary sector, supporting vulnerable people to rebuild their lives.

    I love my job

    :smiley:
  • jonesMUFCforeverjonesMUFCforever Forumite
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    Being brutal here - are you not a little optimistic in clearing debt that you have had for 12 years in even 3 years?
    Taking the second offer of 4.9% over 3 years you will need to make repayments of around £250 per month - is this affordable?

    I would suggest going over to the debt free wanabe board and make a statement of income and expenditure - they will help you to make budgeting savings to enable you to throw more money towards the debt.
  • Thank you for your replies, and no offence taken, very valid point.

    The chances of clearing this debt in 3 years might be unrealistic but i'm going to give it a dam good try.The total amount we spend on CC debt each month is £526 ,which is a whole lot of money on debt that i cant even remember what for.!

    We have come a long way in our financial life, starting from one low paid income and stay at home mum, 5 children and i had been in care as a child. One of the best investments we have is we bought our home and only have about 8 years left on the mortgage.

    Its time to shift the debt.

    Sarah
  • Could you get a decent rate (say 3.9%) on a 5-7 year loan maybe for the £8000 and pay it down that way? More structured and at least you don't have to worry about what to do if you don't get another BT offer when your current one expires.
  • fewcloudyfewcloudy Forumite
    447 Posts
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    Hi Sarah,

    Apologies if you already know, but are you sure you would have to pay a fee? There are numerous fee-free 0% balance transfer cards out there, and you can use the MSE tool provided to check what chance you have of being accepted first.

    There are longer periods of 0% interest out there too.

    Lloyds may not be your only/best option...

    https://www.moneysavingexpert.com/credit-cards/balance-transfer-credit-cards/
    Feb 2008, 20year lifetime tracker with "Sproggit and Sylvester"... 0.14% + base for 2 years, then 0.99% + base for life of mortgage...base was 5.5% in 2008...but not for long...all credit goes to my mortgage broker...and yes he knows it...I never stop telling him
  • Well i have gone for the 12 months interest free and with fee.
    I have moved all 3 cards, they have gone though.
    Have set the Direct Debit for £250 per month.
    And cut up the 3 cards that were paid off.
    I have also made a spread sheet for the next 12 months with a reminder for this time next year.
    This will be easier for me with having only 1 Card and Direct debit.
    I now need to sort out my CC !
    Sarah
  • D_M_ED_M_E Forumite
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    You were paying £576 per month on the cards which you cut up?

    If so, would suggest you increase your DD frrom £250 and set it at £450 - this would still leave you with £126 spare, or is there a reason why you need the extra £326 a month?

    Setting it at £250 would clear £3000 but at £450 there would be £5400 cleared leaving a lot less of the original £7980 to clear or shift at the end of 12 months.
  • I'm sorry that i wasn't clear on details, DH has four CC , Three have balances totaling £7980, i have now moved that to his Lloyds CC for 12 months interest free and will cut up the other cards.And pay £250 month toward this.
    I have Four CC and an overdraft which i need to sort out. I pay £276 a month on these cards..That is my next aim to either get a loan or a 0% card, Ideally i would like to have all on one card as easier to keep track off.
    I have applied for a Natwest card 20 month 0% no fee, it will cover one of the cards that i pay £41.24 month interest alone. So its a start , lets hope i get it. I have a natwest account ,not the overdraft one.
    DH has been informed of all that i have been doing and is as keen as i to get rid of the debt.

    Thank you taking the time to reply

    Sarah
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