Barclaycard Paydown Plan and credit file

BigBaldBod

I owe approx 10,500 on my Barclaycard (20.32% APR)

My minimum payment is about 270 each month, and I usually pay about 300.

I then sometimes use the card in an emergency if close to payday.

I never go over my limit and always leave headroom in the available balance for the upcoming monthly interest charge.

I know this is not sustainable and I have just cleared a loan. I have two other loans which will be clear around Jan 26. This barclaycard was next for "cutting up" (so I don't use it) and repaying.

Barclaycard have written to me telling me I am in Persident Debt and have offered a "Paydown plan" with reduced interest (17.x%)  for 3 years for 305 a month.
Great, I was planning to do this in January anyway.

Their letter says quite clearly that "Taking out a Paydown Plan will have no impact on your credit file, as long as you continue to make at least your minimum fixed payment on time each month".

A cursory Googling shows that paydown plans DO go on your credit file as an AP marker.
I really must avoid this. My fixed mortage is coming to renewal next year and I want to be able to lock into another fix for 5 years. An AP marker will kill my chances of this.
I'm also quite protective of my credit history. I've never missed *any* payments to creditors in the past 20 years.

My question is two-fold : Can anyone advise about the AP marker, which seems contradictory to what Barclaycard is telling me. Will my credit file be marked? Will it affect my remortgage chances next year?

If my future credit and mortgage chances can be guaranteed to not be affected by accepting the Paydown plan then great, I'll go for it.

If not, then what's the best way to get round this? I've looked at 0% cards through the MSE availability checker and without actually applying, the only one that shows an 'agreed' credit limit was NatWest offering 7250. So if I get that and transfer 6800 over to Barclaycard, I'm still left with 3700 on the Barclaycard.
I could possibly then pay 170 to NatWest (to clear in 34 months at 0%), and keep paying 150 to Barclaycard under my current terms. This would be dependent on Barclaycard accepting the balance transfer as enough to hold off the Paydown plan.

Apologies for the long post, thoughts?

Jami74

I do not know about the AP marker or whether accepting the payment plan will affect your mortgage renewal.

NatWest do have their own soft search eligibility checker which might give you a better idea of whether they're likely to lend to you and how much. If you can shift any of it to 0% interest that would save you some money over the longer term, although be aware of the transfer fee.

20% on £10,500 is over £170 a month, whereas 20% on £3700 is about £62 a month. It would mean more money going to pay off your debt each month.

Ideally you'd pay as much as you can to Barclaycard as it's charging interest and minimum to NatWest. Barclaycard would be paid off after 18 months and then you could redirect those payments to NatWest.

BigBaldBod

Thank you Jami74. That's a very good point about minimising the NatWest payments to get the BarclayCard balance paid off quicker, then up the NatWest when that's done. I'd have to calculate the amounts and dates etc, but that's a good idea.

Olenna

Have you looked at getting a loan to pay off the Barclaycard as even 17-20% is quite high for persistent borrowing. 

As for the mortgage, a new fix with your current provider is unlikely to mean lots of checks as it's just a product change. 

MyRealNameToo

BigBaldBod said:

I owe approx 10,500 on my Barclaycard (20.32% APR)

My minimum payment is about 270 each month, and I usually pay about 300.

I then sometimes use the card in an emergency if close to payday.

I never go over my limit and always leave headroom in the available balance for the upcoming monthly interest charge.

I know this is not sustainable and I have just cleared a loan. I have two other loans which will be clear around Jan 26. This barclaycard was next for "cutting up" (so I don't use it) and repaying.

Barclaycard have written to me telling me I am in Persident Debt and have offered a "Paydown plan" with reduced interest (17.x%)  for 3 years for 305 a month.
Great, I was planning to do this in January anyway.

Their letter says quite clearly that "Taking out a Paydown Plan will have no impact on your credit file, as long as you continue to make at least your minimum fixed payment on time each month".

A cursory Googling shows that paydown plans DO go on your credit file as an AP marker.
I really must avoid this. My fixed mortage is coming to renewal next year and I want to be able to lock into another fix for 5 years. An AP marker will kill my chances of this.
I'm also quite protective of my credit history. I've never missed *any* payments to creditors in the past 20 years.

My question is two-fold : Can anyone advise about the AP marker, which seems contradictory to what Barclaycard is telling me. Will my credit file be marked? Will it affect my remortgage chances next year?

If my future credit and mortgage chances can be guaranteed to not be affected by accepting the Paydown plan then great, I'll go for it.

If not, then what's the best way to get round this? I've looked at 0% cards through the MSE availability checker and without actually applying, the only one that shows an 'agreed' credit limit was NatWest offering 7250. So if I get that and transfer 6800 over to Barclaycard, I'm still left with 3700 on the Barclaycard.
I could possibly then pay 170 to NatWest (to clear in 34 months at 0%), and keep paying 150 to Barclaycard under my current terms. This would be dependent on Barclaycard accepting the balance transfer as enough to hold off the Paydown plan.

Apologies for the long post, thoughts?

An "arrangement to pay" on your credit history is where you agree to pay less than the minimum payment so they dont mark you as underpaying each month but do mark you arent meeting your contractual minimums but by agreement. 

In the barclaycard offer you are still paying more than the minimum payment, just in exchange for the overpayment they are offering you a discount on the interest rate. As they say this won't show on your credit history as its not below the minimum payment 

ManyWays

It is helpful when a lender is quite clear when a payment plan will or will not affect your credit record.  I think "Their letter says quite clearly that "Taking out a Paydown Plan will have no impact on your credit file, as long as you continue to make at least your minimum fixed payment on time each month"." is very clear. You should assume this is correct, check your file after a couple of months and COMPLAIN if there are any negative markers... I do not expect there will be, but if there are, they should be removed and you will probably get paid a bit of compensation too.

Google and AIs are NOT a reliable source for debt or credit record advice. A clear statement from your lender can be relied on, and if you don't have a clear statement, you should ask the question, not rely on Google/AI.

My fixed mortage is coming to renewal next year and I want to be able to lock into another fix for 5 years. An AP marker will kill my chances of this.
If you only want a new fix from your current lender, they will offer you one automatically without credit record or affordability checks provided you do not have mortgage arrears. But an AP marker would prevent you from remortgaging elsewhere

the only one that shows an 'agreed' credit limit was NatWest offering 7250. So if I get that and transfer 6800 over to Barclaycard, I'm still left with 3700 on the Barclaycard.
I could possibly then pay 170 to NatWest (to clear in 34 months at 0%), and keep paying 150 to Barclaycard under my current terms. This would be dependent on Barclaycard accepting the balance transfer as enough to hold off the Paydown plan.
Getting the balance transfer sounds a better option to me; getting two thirds of the balance at 0% and keeping 1/3 on 20% trumps paying 17% on it all. 
There is also the option of taking the Barclays offer and then getting a BT for a lot of it to 0%