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Consolidation
Loobyloo1234
Posts: 1 Newbie
Looking for some on advice on whether a loan or a cc is best for consolidation?
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Comments
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Boards generally dont like consolidation at all as most dont go on to pay off the consolidated debt but instead accrue more debt.Loobyloo1234 said:Looking for some on advice on whether a loan or a cc is best for consolidation?
All depends on what you can get and at what APRs. A CC can be cheaper but unless you can be sure of paying it off in full within the interest free period you run the risk that when this deal comes to an end you can't get another so the interest jumps to 20%+ . Loans will have a higher interest rate so cost more but once secured you know the rate won't change during the duration of the loan which may give you more comfort if you need more time to repay than the maximum duration a CC will give you.0 -
If you have debt problems go over to the Debtfree Wannabe board for the best advice, and yes consolidation is not the way forward.Loobyloo1234 said:Looking for some on advice on whether a loan or a cc is best for consolidation?If you go down to the woods today you better not go alone.0 -
Banks see consolidation as new debt + old debt as no guarantee you will pay the old debt off so they have to consider if you can afford both debts and that will be whether you get the loan or how much. Also, a CC for consolidation doesn't really mean much - you could balance transfer existing CC debts but you can't use a CC for loans for example
Sam Vimes' Boots Theory of Socioeconomic Unfairness:
People are rich because they spend less money. A poor man buys $10 boots that last a season or two before he's walking in wet shoes and has to buy another pair. A rich man buys $50 boots that are made better and give him 10 years of dry feet. The poor man has spent $100 over those 10 years and still has wet feet.
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You can thanks to Money Transfer cards... in my experience at least most cards that offer BT also offer MT though the fees for MT tend to be slightly higher.Nasqueron said:Also, a CC for consolidation doesn't really mean much - you could balance transfer existing CC debts but you can't use a CC for loans for example0 -
If you already have a CC with a 0% offer on it (or which regularly offers them) then that is a good option to buy yourself some time to get the source of the debts sorted out. But taking on more credit can, as already mentioned, just aggravate the problem.
I'll get this moved to the debtfree wannabee board. Have a look for the statement of accounts (SOA, see the link in my signature below) fill that out and copy it in to this post and the regulars there will be able to see if there are things that can be tweaked in your budget to point you to a debt solution.I’m a Forum Ambassador and I support the Forum Team on Debt Free Wannabe, Old Style Money Saving and Pensions boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.
Click on this link for a Statement of Accounts that can be posted on the DebtFree Wannabe board: https://lemonfool.co.uk/financecalculators/soa.php
Check your state pension on: Check your State Pension forecast - GOV.UK
"Never retract, never explain, never apologise; get things done and let them howl.” Nellie McClung
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Yes I meant BT for loansMyRealNameToo said:
You can thanks to Money Transfer cards... in my experience at least most cards that offer BT also offer MT though the fees for MT tend to be slightly higher.Nasqueron said:Also, a CC for consolidation doesn't really mean much - you could balance transfer existing CC debts but you can't use a CC for loans for example
I find cards are a bit hit and miss, Barclays, Halifax/Lloyds do both offers, MT shorter and higher fee yes but others are more restrictiveSam Vimes' Boots Theory of Socioeconomic Unfairness:
People are rich because they spend less money. A poor man buys $10 boots that last a season or two before he's walking in wet shoes and has to buy another pair. A rich man buys $50 boots that are made better and give him 10 years of dry feet. The poor man has spent $100 over those 10 years and still has wet feet.
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