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Credit Card Consolidation?
ThatOne81
Posts: 1 Newbie
in Credit cards
I'm having trouble getting my head around what my best option would be and I'm wondering if anyone had a simple solution.
First off, I don't feel my level of debt (approx 7K) would require an IVA. In short, I have debt on 3 credit cards:
MBNA: £2,000 (33.5%)
Capital One: £2,800 (0% until September 2024 and then 22.4%)
Tesco: £1,920 (1.805%)
Im hoping to consolidate all of these into one monthly payment. Two of these cards have been previous balance transfers. I can't find a card that will grant a credit limit higher than £2,500 so I can't even transfer the two I'm currently being charged interest on.
Transferring the MBNA would make sense if balance transfer were the only option, I'm sure, but is there an easier way than still having three cards to pay off?
Any advice would be greatly appreciated. I've been looking at Ratesetter which has a manageable monthly for over 48 months but I'm wondering which way to go.
First off, I don't feel my level of debt (approx 7K) would require an IVA. In short, I have debt on 3 credit cards:
MBNA: £2,000 (33.5%)
Capital One: £2,800 (0% until September 2024 and then 22.4%)
Tesco: £1,920 (1.805%)
Im hoping to consolidate all of these into one monthly payment. Two of these cards have been previous balance transfers. I can't find a card that will grant a credit limit higher than £2,500 so I can't even transfer the two I'm currently being charged interest on.
Transferring the MBNA would make sense if balance transfer were the only option, I'm sure, but is there an easier way than still having three cards to pay off?
Any advice would be greatly appreciated. I've been looking at Ratesetter which has a manageable monthly for over 48 months but I'm wondering which way to go.
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Comments
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The debt free wannabe sub forum would be a source of lots of useful advice I think https://forums.moneysavingexpert.com/categories/debt-free-wannabe
Are you currently making a meaningful dent in the debt each month? If not then I recommend the above sub forum even more!
If you are paying the debt down but want to do so quicker you need to 1st look to reduce interest and 2nd prioritise repayments (as you have started to do). Personally I would forget about rolling it all into one payment unless that can happen by happy coincidence (unlikely from what you have said about limits offered). If it really matters to you and helps you budget you could set up a second current account purely to pay the CC direct debits and set a standing order to transfer the required money for the next month straight after payday - that way you would see the money go from your main account and know the CC repayments were covered.
A loan might be a sensible option if you can’t shift card debt to 0% but not for the Capital One account as that is costing you nothing for the next 13 months, but look at what you can shift first even if it is only chunks of the high interest debt theres no need to do it all in one go.0 -
ThatOne81 said:
I can't find a card that will grant a credit limit higher than £2,500 so I can't even transfer the two I'm currently being charged interest on.0 -
Other than echo the above. Consolidation rarely works. Unless you are going to shut all the cards down, not apply for any others till you have paid the debt off.
Sadly something people tend not to do, so the small debt becomes even biggerLife in the slow lane0 -
ThatOne81 said:I'm having trouble getting my head around what my best option would be and I'm wondering if anyone had a simple solution.
First off, I don't feel my level of debt (approx 7K) would require an IVA. In short, I have debt on 3 credit cards:
MBNA: £2,000 (33.5%)
Capital One: £2,800 (0% until September 2024 and then 22.4%)
Tesco: £1,920 (1.805%)
Im hoping to consolidate all of these into one monthly payment.What are you hoping to achieve by consolidation? How is one payment better than three?What you need is to transfer high-interest debt (or at least part of it) to lower interest and only if this transfer doesn't cost too much.
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