I've consolidated all my debts into 2 loans. Need some opinions on my next steps

kimwp

Jami74 said:

Pay an extra £275 (2 months overpayment) to the highest interest one each month. Then you'll be debt free in 3 years. If your relationship costs more than £25 a month then cut back elsewhere for that extra 'fun'.
Or
Pay an extra £300 toward the lower loan. It'll be gone in 6 months. It won't save as much interest over the long run but would free up £354.35 each month. Then pay £275 extra each month to the higher interest loan and have it paid off in a couple of years.

The second option only makes sense if there's a wish to reduce the number of loans to one quickly. By paying the minimum on the lower interest one (which as you note, reduces the overall interest/amount paid), it's also "freeing up" the £300 for the higher interest loan.

redux

Jami74 said:

Pay an extra £275 (2 months overpayment) to the highest interest one each month. Then you'll be debt free in 3 years. If your relationship costs more than £25 a month then cut back elsewhere for that extra 'fun'.
Or
Pay an extra £300 toward the lower loan. It'll be gone in 6 months. It won't save as much interest over the long run but would free up £354.35 each month. Then pay £275 extra each month to the higher interest loan and have it paid off in a couple of years.

Sorry, but that just doesn't make sense.

Comparing 16.2 and 28.5% on the £1540 or so, if it went the full term, the lower rate saves nearly £16 in the first month and a bit over £350 in 3 years.

If the higher rate loan went to full term, over half the amount repaid would be interest.

Be ambitious, and all overpayments to the higher rate one first. Only take top up offers on the lower one or any newer one at lower rate, and use the whole amount of that straight away against the high rate loan, not as new spending.

Jami74

redux said:

Sorry, but that just doesn't make sense.

I agree. I would do what you are suggesting if I found myself in the unfortunate position that the OP is in. However, none of the OPs original post really makes sense. He/she has nearly £500 a month for debt repayments yet has consolidated £7k over 7 years at very high interest rates. He/she wants to overpay the loan each month in order to reduce monthly repayments, while keeping some money back for fun spending. It suggests that the OP hasn't had their 'lightbulb debtfreewannabe' moment and is not fully committed to paying it all off as fast as possible. Smaller steps with a bit of room for fun money might keep motivation up.

Emmia

I suspect (speculation) the "fun" money is because they are in a relationship /looking for one and they don't necessarily want to be open about their financial situation...

Staying in (rather than going out, although the chance would be a fine thing these days) is usually much, much cheaper.

Hopefully the OP has already shut the credit cards that the loans were taken out to cover.

benbay001

My question would be, whats changed between when you originally built the debt to now?
At some stage, youre expenditure was significantly higher than your income, otherwise you wouldnt have needed to borrow.
Yet now, not only do you not need to borrow, you also claim to have a spare £500 to make repayments.

MrFrugalFever

benbay001 said:

My question would be, whats changed between when you originally built the debt to now?
At some stage, youre expenditure was significantly higher than your income, otherwise you wouldnt have needed to borrow.
Yet now, not only do you not need to borrow, you also claim to have a spare £500 to make repayments.

perhaps the action of consolidating to a longer term (7 years and 3 years respectively) from minimum payment credit cards has provided a lower monthly minimum payment to free up cash that the OP wouldn't otherwise have on his previous arrangement. 
As mentioned above by Jami74, it doesn't make sense to do what he has done other than to free up additional monthly disposable income to then continue to spend with a view of paying off the loans over a much longer period of time (again referring back to 7 and 3 years).
I would suggest the best course of action is to work out ways of cutting expenditure back enough to facilitate a reasonable over payment - £200-300 as OP has suggested and to allow for some flexibility in his 'fun' factor. However, having debt which is a struggle to pay back WILL result in a lowering of one's quality of life as far as 'fun' is concerned because you cannot have your cake and eat it.

[Deleted User]

I'm in a relationship, it's covid Britian, we don't spend £150 in 2 months for "fun" - the only fun we have that costs money is a weekly takeaway treat. You can't go out for food or to visit places like a cinema, what on earth are you spending on? If you want to keep debts hidden and you're paying loads on stuff like food, pretend to go on a health kick and stop ordering so much.