Credit card debts

Firefly10

Hello , I’m wondering if anyone can share any information or experiences with dealing with Tesco  Newday and Halifax credit cards. I have a total of 30K debt and fully up to date with  all payments and have never defaulted. I have held the Newday and Halifax cards some 20 years without any difficulty. Tescos approximately 6 years. Up and until about 12 months ago , I had managed to repay them down substantially or keep them  on 0% interest , however they are all now attracting high interest preventing me from reducing the capital. I am no longer using the cards for any purchases and want to ask them to either suspend or agree a lower rate of interest so my repayments can reduce the debt more quickly. I am a self employed and now approaching 70 so becoming a little weary ! My income has reduced over the last 12 months and I see this continuing as added to this my husband is ill and now in the middle  of an aggressive treat plan of hormone and radiotherapy which will also impact how much work I can do and so on my income. I am reluctant to enter into any formal DMP as believe with some support from the lenders regarding interest I can reduce the debt to a more manageable level hopefully without impacting my credit file which has always been impeccable.  I don’t have the option to obtain any further 0% balance transfers as no longer meeting the eligibility . Can anyone share information, advise or experiences 

MorningcoffeeIV

Firefly10 said:

 I am reluctant to enter into any formal DMP as believe with some support from the lenders regarding interest I can reduce the debt to a more manageable level hopefully without impacting my credit file which has always been impeccable.  

Any arrangement for reduced interest with the the lenders will impact your credit file.  But your credit file won't be in great shape as it is, with a lot of interest bearing revolving debt.

You might want to start with an SoA, to get a clear view of the financial situation - but bearing in mind that if you can't manage payments, defaulting will be better than on-going arrangements.

CliveOfIndia

Firefly10 said:

with some support from the lenders regarding interest I can reduce the debt to a more manageable level hopefully without impacting my credit file which has always been impeccable.

As per the previous reply, any arrangement you may come to which involves paying less than the contractual minimum amounts will be recorded on, and will negatively impact, your credit record.

Having said that, are you realistically going to want to take out any new lines of credit in the future?  If not, then the impact to your credit files will be pretty much immaterial.

Firefly10

CliveOfIndia said:

Firefly10 said:

with some support from the lenders regarding interest I can reduce the debt to a more manageable level hopefully without impacting my credit file which has always been impeccable.

As per the previous reply, any arrangement you may come to which involves paying less than the contractual minimum amounts will be recorded on, and will negatively impact, your credit record.

Having said that, are you realistically going to want to take out any new lines of credit in the future?  If not, then the impact to your credit files will be pretty much immaterial.

Thanks for your advise , it would be my intention to maintain the minimum contractual payment to get the debt down so that when interest is resumed it is more manageable 

Brie

There's nothing the matter with ringing the card companies up and telling them about the financial and other strain you are under and ask that they suspend all interest being accrued for a period of time.  Suggest that it's 6 months on the basis that you will continue with at least the minimum DD.  

If they don't like that then I would suggest getting a debt adviser to work with you to get a full statement of accounts drawn up to show them how tight your budget is and to propose suitable payment.  Normally these accounts will show all your income and expenditure and all of your debts.  So creditors will be expecting to be treated fairly along side your other non priority debts so they are each getting the same percentage of what you owe.  

National Debtline, StepChange Community Money Advisers (CMA) can all help with this.  Citizens' Advice might as well depending on your location. 

CliveOfIndia

Firefly10 said:

Thanks for your advise , it would be my intention to maintain the minimum contractual payment to get the debt down so that when interest is resumed it is more manageable 

Apologies, my reply was perhaps not very clear.  You originally said:

Firefly10 said:

... they are all now attracting high interest preventing me from reducing the capital

I ... want to ask them to either suspend or agree a lower rate of interest so my repayments can reduce the debt more quickly

So the contractual payments are the "high" rates you're now being charged.  The bank may indeed agree to suspend or reduce the rate of interest, but this is a deviation from the standard contractual rates, so will be flagged as an "arrangement" on your credit file - which will be viewed negatively by any other lender who looks at your files.

As I say, this is perhaps not such an issue if you don't foresee the need for any more credit in the near future.

sourcrates

Credit card companies will entertain short term payment plans, where they might suspend or lower interest for you, but these will only be short term arrangements, if your issues are likely to persist for longer than 6 months, they will just refer you to one of the debt charities to seek advice on debt management or other options.

Really its a choice between what is giving you the most concern, keeping the debt at a manageable level, and having a life, or maintaining some degree of credit worthiness should you ever want to borrow again in the next 6 years.

Its best to commit fully to just one strategy.

NeverendingDMP

I've found aqua (owned by newday) and Tesco both to be approachable and fair when we got into a sticky situation. Aqua slightly easier to talk with and willing to do a six month plan but both not too scary. I was also able to communicate solely cos the app if I preferred.
It sounds as though you have a lot going and your husband is not well so you will need to focus on other things without having to fret over the money too much so please remember if you contact them you are able to tell them they can only now contact via just email,just post,phone,no phone etc etc. 
And is your income going to allow you to repay it all easily or with a struggle -do you rent or have a mortgages that is paid or still to rent and bills to think about?
S0A and a cuppa is best place to start, best of luck.

tigergambit

Hi Firefly, sorry to hear about your husband, hope he recovers well.
I have been dealing with Tesco and NewDay. First thing to say is that you will have to complete an SoA with them so I would strongly advise that you do that beforehand and put it up here for others to have a look at. There is a lot of missing info which makes it difficult for people to comment (e.g. your income relating to your debts, housing situation etc).

My first question would be why are you worried about your credit rating? At age 70 do you really feel that you will need to rely on credit in the future? If so then you need to address this - again the SoA is your starting point.

I'm 61, questionable MH and a mortgage so have been asking for full and final settlements at quite a low level with money supplied by my children. First thing I was advised to do and did was to request CCAs which has the benefit of suspending payments which will give you a little bit of breathing space. As two of your accounts are over 20 years old you may find that they are unenforceable in which case I understand you can just stop paying (but seek further advice here).

If CCAs are provided (and depending on your SoA) I think you should be considering asking your creditors to write off the debts. Like yourself I had managed debts for many years, paying interest and chasing 0% deals so I don't feel too bad about asking for help now that times are tough. Frankly, you have enough on your plate without worrying about debts.

Tesco: Provided CCA very quickly but then sat on my F&F for 4 1/2 months without replying despite me chasing on several occasions. In the end refused it within hours of me chasing again (so without considering it). Very nice to speak to on the phone, willing to offer reductions, but their admin sucks.

NewDay: Couldn't find the CCA (which was under 3 years old). Kept calling/writing to me as I had stopped payment in response to which I pointed them to the CCA request. They eventually came up with it and settled within days when I made a F&F at 23%. So approachable and willing to help.
I provided an SoA which I had gone through with National Debtline - they send you a copy for creditors which I think comes across more "official" than one you have done yourself (and saves a lot of time) but just make sure you know what figures you want on there before you complete it with National Debtline.

Take Care

TG

Firefly10

Very much appreciate all responses and advise , have prepared a SOA and will be speaking to each of the card providers direct with a view to securing suspended interest and agreeing realistic payment plan. Thanks again appreciate time and and concerns extended to me