Please help me turn my life around, 24 year old with 15k debts

mrcow

Hi again,

Firstly stop beating yourself up! At least you asked the question, and you know your options. Many people bury their heads in the sand with issues like this, and would have simply paid off the repayments without ever knowing

a) how much interest they were paying
b) whether they'd even signed for PPI or not! (it's true) and how much it was
c) how much the credit was costing them overall

It's an expensive lesson to learn, and if I were you, I would still go through the process with Norwich Union. Yes, they'll probably say the same thing, but remember it's YOUR money, and you should at least know where you stand with the finance.

What I'm thinking though is that the 13.9% interest that you are paying does sound high. I've just put the figures into the Cahoot site for a three year £4k loan, and it's coming up with £122 per month which would save you £864 in interest over the remaining period of the loan, but then there's no guarentee that you'd get Cahoot's best rate, and you'll also lose the benefit of the PPI, which, as you very rightly say you've already practically paid for, so there doesn't seem much point getting rid now? It's up to you whether you'd want to look into it?

You're much better off trying to throw everything you can at your credit card debt in the meantime until you come a decision on the 0% application.

This has put me on a downer! Still got to hear about job interview for bar job, need to get credit file, apply for a 0% card and set up a basic bank account.

How can you be on a downer, when you have so many positive things to be getting on with! You're doing really well just taking in all the info that's being thrown at you from this site alone!

And also take a look at your budget, where people have said maybe you could look at cutting back? Have you come to a decision on your car situation?

Good luck.

badmission

No need to be on a downer, it's good to know where you stand. The credit card saving is good. The HSBC loan is what I expected you might find, but it's not the end of the world. Sure it's a c**p loan, but that's the incentive you should have for moving that debt...

Malestrom

I agree with the posts above, you've made a good start so don't now fall at the first hurdle, ring NU and see if the PPI is the same. You won't get lectured, just ask the question and if you can't cancel it then say thanks and hang up. No big deal. But if you can cancel it and you make a similar saving then thats £50 a month better of for two phone calls - excellent!

Keep going mate, its hard work but well worth the rewards, just think how great it will be to have your own place....

lupogti

*Update**

Just phoned NU up today regarding the loan and the chappie said that I could cancel my PPI and pay less a month or carry on paying the same amount monthly and with PP removed will shorten the life of the loan.

I have to confirm in writing. I am just going to canecel the protection and put taht towards CC payments as that is a higher APR. This will save me £30.69 a month! Plus the PP cancelled on my CC has saved me £26.60.

So made a saving of £57.29 a month which I WILL plough into my CC re-payments!

The HSBC PP is still up in the air will try and complain that I was mis-sold but if no joy I will re-asses the situation and take advice about getting another loan over 3 years with someone else even though it wont be the best rate i'm sure i can get below the 14.9% loan i have at the moment with hsbc.

Appreciating the advice hope you guys n gals

G

mrcow

lupogti wrote:

I am just going to canecel the protection and put taht towards CC payments as that is a higher APR.

So made a saving of £57.29 a month which I WILL plough into my CC re-payments!

That's great. I'm really pleased for you. And you are right, it is best to get this off the credit cards first (make sure that you do!!), and then once these are paid off, put the repayments towards settling the loans.

I think that you are right, it's worth writing a letter to HSBC. What's the price of a stamp compared to what you could save yourself if they do change their minds? And it also gives you some focus for your frustration over it.

badmission

Top stuff. Sounds like you pretty much have nailed the PPI situation. Next stage is to sort your APRs

Do remember that you can move the debt around to get the best deal. A loan can be paid off with a credit card, and a credit card can be paid off with a loan...

Credit card
+ easy to move debt around, possible to pay NO interest, which we like!
- have to be discplined not to spend any more on it for "emergencies"
- have to watch out for rate changes i.e. when 0% ends

Loan
+ setup and forget, no change in rate
- inflexible, tied in for years, no 0% but some reasonable deals i.e. 5.7%
- reasonable deals not always offered to everyone. i.e. typical rate

But with 15k or thereabouts I think it is important that you switch as soon as you can.

But nice one with sorting as much as you have

youngandreckless

Wow you're doing so well! Does anyone know if applying for another loan can harm your credit the same way applying for credit cards does? (a previous post warned to be careful on keeping applying) The only reason I ask, is that my Cahoot fixed rate loan is at 6.9% which could potentially help with the HSBC situation,if a change of loan was an option

debtbuster2K5

youngandreckless wrote:

Does anyone know if applying for another loan can harm your credit the same way applying for credit cards does?

All applications for credit , and bank accounts and sometimes Insurance appear as a search on your file.(There are some exceptions to this) This is why it is not always prudent to continually apply for credit, as lenders will look at the amount of searches and think that you may be desparate for money.


Happy to be told otherwise though...

Regards

youngandreckless

Thanks Debtbuster, I figured that but wanted to be sure

lupogti

*** Update***

Just applied online for a Virgin 0% 9months CC! ( Don't worry not drunk , can't sleep due to the heat!)

Anyway really hoping they accept as it will set me off nicely!

Whther they accept me or not I am going to apply for a $4000 loan over 3 years with Northern Rock or Cahoot - even if i get 9.9% offered it is better than my HSBC %.

As I am well aware if I get turned down by both CC and Loan application it won't be beneficial to my credit rating to keep trying.

Looks like i'm getting out of debt the hard way, sticking with the loans and CC I have got and learning valuable lessons!

I havent missed a payment over the last 2 years so fingers crossed ...tick tock


G