Advice re husband’s debt

halfwitwithmoney

Hi, I think I probably know the answer to this but I’m asking people wiser than me. My husband has been seriously depressed and has run up around £8k worth of credit card debt. He has always kept up the minimum payments. He has done this primarily by telling me he had bought furniture, car services etc outright but actually putting them on finance. We both have a decent income. The card it is all on is 18% apr. He has handed all finances to me, and his salary is paid into the account I access now, and I take care of all the bills with both salaries. He gets an allowance each week and then I do the rest of the spending. Must emphasise he is fully on board with this and is actually finding life much easier this way. 

My question is - I can get a loan for 3.3% APR for the entire amount plus a tiny bit of car finance that’s left on my car (sub £2k). He has tried and can’t get one. It’ll take me a lot longer and cost a lot more to do it with leaving it on the card as it is, I can overpay the loan but obviously I’m then taking his debt in my name. 

What would you all do?

sourcrates

Never consolidate your debts, it’s a very bad course of action to take, costs you more, extends the time your in debt, you end up adding to it, and then consolidating again, it’s a slippery slope once you start.
Low rate loans are scarce right now, lenders are been very savvy who they lend too, it’s better to take debt management advice and take the hit on your credit file, than to get sucked into consolidation loans.

halfwitwithmoney

That’s what I thought. They will give it to me at that APR as I’ve got a really decent credit history. But I’m more motivated to pay it off as it is, I feel like if I took a loan out I’d just sit back and go “bye monthly payment” and that would be that. Thanks for confirming I’m not totally bonkers to go with the higher APR plan 👍🏻 I’m following the Dave Ramsey plan, would you say to do that or would you attack higher APR first in this instance? 

sourcrates

Some swear by the Dave Ramsey approach, others prefer tackling the debt with the highest interest rate, it’s really down to personal choice and what works best for you, so can’t really recommend one over another.

ryanm8655

Given you didn’t ring up the debt and you’ve presumably set a budget to clear it based on your household expenses less husband’s allowance, personally I’d tackle highest APR first. That’ll clear the debt the quickest.

How many cards are there? My advice would be set DD’s to just above the current minimum on all cards and then tackle the highest interest debt with any spare cash.

Also beware of the risk of your husband doing the same again. Not judging, we’ve all been there. If he’s suddenly got far less to spend then there might be the temptation to take out more credit.

halfwitwithmoney

Yeah I’m well aware of it. Not my first rodeo with people running up debt behind my back and then lying about it 😬 hence why I have full access to his entire credit report and all of his accounts. He knows if he lies again he’s in deep trouble.
theres only one card as in his panic he transferred the balance of £4.5k he had on one onto the other to try and clear it quicker. Even though the other had a slightly lower APR 🤦🏻‍♀️ 

I’ve definitely been there - spending money to make me happy, but I’ve seen the light, it just made me more worried and miserable. He can see it now as well and he’s really angry with himself. He’s also got a loan, I’ve cleared the store card and amazon finance he had already since I found out 6 weeks ago. 

TheAble

I think just leave things as they are and work on repaying it asap. Obviously 18% is a horrible rate of interest but at least with it all kept in his name it will keep a lid on him taking out more credit. Also the high APR should be a real motivator.

Andyjflet

Morning, please dont borrow any more money, it took me too many years to realise and wake up, borrowing your way out of debt isnt the answer.
Instead, I would watch and listen to Dave Ramsey podcasts, put together a tight budget and then snowball the debts from smallest to largest, this then means quick, motivating wins, its working for me. 

ZaSa1418

Definitely don't consolidate, the only thing that i would potentially look into is seeing if someone could get a 0% balance transfer CC although i think the offers on these are few and far between at the moment. 

RAS

Do not consolidate.

Make sure that the minimum plus some extra comes out of his account as soon as he is paid. Then hammer it with what you can afford, after discussing that month's priorities together. And check every few months if he could get a balance transfer, soft check of course. Then get him to do it if it makes sense.

That way he rebuilds his financial situation and self worth.

greensalad

I know the general consensus is to not consolidate. It worked out amazingly well for me though. I think it can be a good idea if you trust that you will not get into more debt. My consolidation brought my DFD forward about 2 years and I just finished paying off the consolidation loan. If you don't trust that you have broken the cycle that got you into debt in the first place, don't do it.