Becoming debt free


we are in roughly £30000 in bebt on mostly credit cards. This has become a slow spiral of debt over the last 10 years, and the current cost of living is not helping. We desperately want to be debt free or at lease reduce our monthly payments to give us the relief to stop spending on credit cards each month.

 Most of our cards are on 0% but they just seem to be something we are really struggling to get down. We are considering a consolidation loan to clear this. If we did this option it would reduce our payments we currently make on the cards each month.

 We moved into a property 3 years ago and renovated and we have made quite a lot of equity in our home. We have considered taking this out of the property, but believe it is risky and with the current climate and interest rates would it be worth it? We still have a fixed low rate for the next 2 years. 

We really need some advise on what the best options for us would be? 

Thank you 


  • sourcratessourcrates Forumite
    26.3K Posts
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    She2009 said:

    We really need some advice on what the best options for us would be? 

    Thank you 
    Not taking a consolidation loan would be my first bit of advice.

    The reasons why not are many and varied, but mainly because people who consolidate the first time around, nearly always fail to change their spending habits, and within a short while have racked up another 30k on the old credit cards, but now have a consolidation loan to service as well.

    I say the first time around, because consolidation is something lots of folk do more than once, even though it failed to restore equilibrium the first time, they go at it a second time, thinking it will be different this time, but unfortunately most fail, and then they have to resort to the debt solution they should have taken in the first place.

    A very expensive lesson in what not to do.

    As you can see, we are not fans of these type of loans on this forum, they nearly always fail, unless you are super stringent with your budgeting.

    It's a much more prudent strategy to look at debt management, if its required, rather than waste thousands on loans you don`t need.

    A statement of affairs will tell us what we need to know, the link to the calculator can be found in the stickies.
    Ex MSE Board Guide.

    More than a third of IVA`s fail....fact.
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    Never pay a fee for a Debt Management Plan.
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  • MarticoMartico Forumite
    371 Posts
    100 Posts Name Dropper
    Agree with Sourcrates, and, as alluded to, I think that the first step would be to make a brutally honest assessment of where you are right now, and then budget accordingly.

    So I would say:
    1. Statement of affairs, which would allow you (and us if you care to share it for more advice) to see what your current situation is. 
    2. On the basis of that, it should start to become clear what your options are. I suspect that some budget tightening might be needed, as well as a focus on which debts to prioritise. 

    You'll get loads of good advice here from people that have been in the same boat, but people will need to see the facts before they can offer their thoughts.
  • BrieBrie Forumite
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    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    Adding another vote to NOT do a consolidation loan.  This is assuming you could even get one as the lenders will be looking at you with your £30k asking for yet another £30k.  So could you (& would a lender believe you could) service £60k of debt? 

    So SOA to let yourselves and potentially us see what the situation is. 

    And a bit of soul searching on your side - what is behind you getting into debt?  It may have been an emergency due to job loss or similar which has now been set to right.  Or it could be emotional spending which is much more difficult to deal with.   And it may be that one of you looks like the problem and the other has to find a way to support them out of that without destroying the relationship.

    And again - yes many of us have been exactly where you are now.  Well frankly I would have loved to have started with only £30k debt.  My first step to recovery (still in progress!!) was to always carry it around with me - quite literally I had a small spreadsheet with all the cards listed and the debts and how much needed to be paid this month, next month and when the 0% deals ended so I wouldn't get caught out on interest.  It was folded up in my back pocket and whenever there was a "really good reason" to spend money I'd pat my back pocket to remind me what still needed to get sorted.  It was reassuring because I knew I was dealing with it.

    Good luck with your journey and well done for taking the first step.
    "Never retract, never explain, never apologise; get things done and let them howl.”

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  • MarticoMartico Forumite
    371 Posts
    100 Posts Name Dropper
    Here's the link for the SOA:
    Be realistic when filling it out, and adjust to monthlies for things that are annuals. Format for MSE and post it here if you would like to share it
  • madaboutspotsmadaboutspots Forumite
    126 Posts
    100 Posts Second Anniversary Name Dropper
    Definitely a vote for NOT consolidating from me. It’s the road to nowhere - at least nowhere dent free.

    Great advice above. Trust this forum as those on it are sensible, helpful, experienced and genuinely care. 👍
    Mortgage Jan 2014 £250k
    MFW date 2nd Jan 2024
    Literally counting the days! 🥳
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