Not sure where to start. Large debt & just sold house but likely being made redundant tomorrow

Karonher

Would Stepchange allow a DMP when there is so much in savings? I know there could be one without Stepchange involvement but surely companies would expect to be paid out of savings.

Grumpelstiltskin

Look forget your credit score no lenders ever see it, it's just a con.

If you do rent you are in a position to pay say 6 months rent up front.

RAS

Good news. Ultimately it is for you to decide what to do. We can only make suggestions.

You need enough to pay the deposit and first month's rent on a new property, maybe 6 months. Or look to rent from an LL rather than an agency.

You haven't listed your debts, but do so in order of APR, highest first. Clear the most expensive first, maybe only the first £15k? Then any really tiny debts. Over the next months use the money not needed for rent to pay more than the minimums on expensive debts. Reducing balances will also impact on your credit record.  Even a fiver over the minimum will help.

Credit scores are a US thing. Here different creditors will have different criteria. I wonder for example if the rules about persistent debt were introduced to prevent some creditors deliberately targeting people who were unlikely to pay off the debt, from whom the interest received would rapidly exceed principle loaned?

Moving and not either renting or being a mortgage owner will affect your credit record as well. Give it 6 months and see what it's like?

horsey666

Grumpelstiltskin said:

Look forget your credit score no lenders ever see it, it's just a con.

If you do rent you are in a position to pay say 6 months rent up front.

True.  I do have the option of paying quite a few months rent in advance.   I thought credit score would be a problem as most rental agencies say they need to run a credit check when applying for a property. 
Anyway, I do want to take the opportunity to say thank you for your responses - it's very much appreciated to know there are people like you willing to offer advice 

horsey666

RAS said:

Good news. Ultimately it is for you to decide what to do. We can only make suggestions.

You need enough to pay the deposit and first month's rent on a new property, maybe 6 months. Or look to rent from an LL rather than an agency.

You haven't listed your debts, but do so in order of APR, highest first. Clear the most expensive first, maybe only the first £15k? Then any really tiny debts. Over the next months use the money not needed for rent to pay more than the minimums on expensive debts. Reducing balances will also impact on your credit record.  Even a fiver over the minimum will help.

Credit scores are a US thing. Here different creditors will have different criteria. I wonder for example if the rules about persistent debt were introduced to prevent some creditors deliberately targeting people who were unlikely to pay off the debt, from whom the interest received would rapidly exceed principle loaned?

Moving and not either renting or being a mortgage owner will affect your credit record as well. Give it 6 months and see what it's like?

Thank you - really appreciate the advice 

ManyWays

I hope the operation can now get scheduled in as soon as possible. Do you want to move before this?

Can you list youyr debts including the interest rates and the balance remaining. It would probably make sense to clear off some of the more expensive ones.

horsey666

ManyWays said:

I hope the operation can now get scheduled in as soon as possible. Do you want to move before this?

Can you list youyr debts including the interest rates and the balance remaining. It would probably make sense to clear off some of the more expensive ones.

So I currently owe around £45k.  I have around £33k in proceeds from house sale (but I need to find a place to rent!).  I earn around £4,200 net per month, and my current outgoings are around £3,200 (including all my minimum payments - i.e. before I've cleared any of them).  Here are my debts:

Creditor	Owed	Interest Rate	Monthly Payment
MBNA	£11,357	25.66%	£325.00
Halifax	£10,477	21.67%	£277.00
Sainsburys (Natwest)	£7,838	27.27%	£257.00
Barclaycard	£5,814	20.93%	£142.00
First Direct Loan	£2,784	3.30%	£127.00
FIrst Direct Loan 2	£2,531	3.30%	£180.00
Natwest	£1,536	0.00%	£16.00
Capital One	£1,497	23.29%	£45.00
Very	£1,458	46.90%	£40.00
TOTALS	£45,292		£1,409.00

badmemory

Are those figure for Very correct?  If they are that debt is going up.  That is not good.

horsey666

badmemory said:

Are those figure for Very correct?  If they are that debt is going up.  That is not good.

Unfortunately yes, the numbers are correct- though its a little more complicated. Most of the amount owed is currently 0% but if it's not paid within a few months the high rate kicks in

Grumpelstiltskin

OK So the obvious one to clear first is Very.

Then Capital  One , that give you £85 monthly to throw at any other one and you have only used up £3000 of your savings.