Credit card / personal loan help

Martico

Pay those cards off by paying those cards off if you can, not by shunting the debt onto a loan. You may get some 0% transfer deals along the way, which will help, but getting a loan just moves the debt, it does not pay off the debt

Chrysalis

My thoughts are.

Loan will be 100% utilisation (amount used same as credit), it has you pay off debt via set schedule.

The problem with using loans to pay off debt is I think related to discipline, if you use a loan to pay off credit cards you then have credit cards available for use with £0 balance and if you dont have discipline you build up the balances again and then you have double the debt to manage.  I did this myself when I was around 20.  Bank advisor gave me loan, told me to pay off the bank's cc with it at counter which I did.  But I then loaded the card again later whilst still having the loan to pay off.

As has been said using a loan is not paying of the debt it is just moving it, mentally that is important to accept as your mental treatment of this debt will affect your ability to repay it.

It can be a reasonable idea to use the loan if it is a significantly cheaper interest rate vs the cards so e.g. you dont qualify for 0% offers, but maybe qualify for a 3% loan or if you so bad at discipline refusing to pay more than min amount a loan can overcome that due to the way their payments work.  But in that scenario you should stop using the cards or cancel them after the debt is moved.

born_again

Haphazardsaver said:

To pay off the cards will be about 3 years - so only way to pay off ahead would be with a loan. 

I do check my credit reports and all look accurate. 

No discussions yet but will look into doing that. 

I suggest you post in the debt section with a statement of affairs.

The danger here is that you will not get a loan, given the amount of debt you are already carrying. Or if you do the headline rate will not be what you are offered.

enthusiasticsaver

I suggest you do not take out a debt consolidation loan. They usually lead to higher debt overall. 

How much is the debt and how much are you repaying each month? 


If the debt is not at 0%, why not? What interest rate are you paying? 

If you are applying for a mortgage next year I suggest you set a budget and try to get the credit card debt gone before application. Any debt you have will reduce the amount you can borrow. 

grumbler

enthusiasticsaver said:

I suggest you do not take out a debt consolidation loan. They usually lead to higher debt overall. 

...

If the debt is not at 0%, why not?

How is a transfer to a 0% card, if possible, better than a consolidation loan? The only difference is the interest rate. Both CAN "lead to higher debt overall" IF the old CC(s) is used again for spending.