Renew loan, get a low % Cred-card...or just try to hold out?

Scott_James

Hello all!
Ok, I've had a look round the site, and it's helped to clear up some options for me. I have some financial quandries, and being here has helped me sort out what I Don't want to do. Now I could do with some opinions on what I should do.
Here's the situation. I have a loan of £4500, which matures in December, and is being paid off at £308 a month. I have monthly car payments of £250 a month, for a total of 3 years. I've paid up 11 months so far, so I got 2 years one month of payments to go, and a £6000 ballon at the end. House bills come to about £300 a month (max).
I get about £1600 a month (after Tax etc.) I'm about £500 into my overdraft (I got £2700 limit on that) and my Credit Card has about £100 on it. So it isn't a bad situation, all be told, I know a lot of people have it worse. But I really feel I could be making my money go further. I want to get out of that debt and pay off my loan and car payments ASAP. I'm hoping to buy a house with my girlfriend, since at the moment, we're renting. (Short story with that is, we wanted to make sure we could make the 'living together' thing work. It does! hurrah! So we're ready to buy)
In the long term we want to emmigrate to Australia, but that's perhaps beyond the scope of the question of this post.
Getting down to it, that's my situation in complete, and numerical, detail. I'm hardly drowning in debt, but can't seem to stop treading water and get out of the pool as it were. Everytime it looks like I'm going to get good and clear of that overdraft, something like car insurance comes along, or there was recently a huge screw up with my bank who left me in the lurch. While I may not be struggling, it's getting frustrating to always have to have a 'lean' month and not be able to really spend money on anything much but the essentials and debt clearing, and I hate having such a large chunk of cash going out every month before I've even done anything.
I was thinking of getting a loan with my bank, about £15,000, so I could buy my car, clear my overdraft and credit card, and have just one monthly payment. Sounded like a good idea to me, but I bet there's a much more canny way to sort this all out! And, obviously, I don't really trust my bank anymore either. So is there a clear-cut, financially sound method for untangling this?

tealady

Hi If you put up a full SOA then the clever peeps on here can hopefully point out the best way to get the money together to pay you debts off.

Scott_James

Ok, I'll try again!

Income: £1600/Month (After Tax etc.)
Partner's Income: £1100 (after Tax etc.)

Outgoings (Just my share, monthly unless otherwise stated)
Rent £240
Water: £30 (quaterly)
Electricity: £20 (Quaterly)
Phone contract: £25
Petrol £50-£100 typically.
Car Payment: £251 (25 payments left plus a £6000 baloon)
Loan Payment: £308 (Matures in December)
Car Insurance: £425 (Comes out March)
Car Tax: £110 (Came out February)
Overdraft: £500 (At the moment the interest is negligible, about £3 as it stands)
Credit Card: £80 (APR is about 9%)
Groceries: About £50 (I eat at work)
Going out: Barely anything! Went out once last month, and plan to once this month too!

As I explained in my previou post, I intend to buy a house with my girlfriend and ideally emmigrate after about 2-3 years, and want to be in a position where I can comfortably start saving, be ready for financial pitfalls, and even spend some money on myself too. I'm not in the worst position imaginable, but I'm getting sick of just paying out money all the time and not having any decent spending money or just getting floored by unforseen expenditures (For example, minor car repairs, or my phone company saying that I wouldn't get charged for receiving calls when being abroad with work when actually, I did. Nice). I should have enough money to save, but it just doesn't seem to work out like that, and I haven't bought anything for myself or done anything with my money except try to clear my Overdraft since before Christmas.
I was considering a loan (about £13,000) to pay off the car, OD, Credit card and supply some start-up money for a house, but it would mean being a slave to the bank for another 5 years. But Is it still the best option? If so, with whom should I go? Or is there a much more intelligent way to get into the black?

IWantToBeFree_2

Personally, I don't think consolidation is the answer, your loans could well be front loaded with interest and if you take another loan to consolidate them, you would be paying interest on the interest and whilst it would be more convienient to have one payment coming out every month, you'll end up paying far more in interest than you would if you left it as is.

Taking out a loan to have a start up fund for the house, in my opinion, is a bad idea. For the start up fund, you would be far better just putting money to one side in a savings account, do you really want to be paying interest on a house fund?

We started saving last June for our house fund, and most of the money in there has come from ebay, amazon & cash back sites and up until we recently had to start using it, it had £2k in it.

On the emigrating point, do you really want to buy a house knowing that in 2/3 years you'll have to sell it, or rent it out & have all the issues with being a non resident landlord? With all the solicitors fee's & stress that comes with buying a house (I'm in the middle of doing it now & its awful) I wouldn't have thought it would be worth it for such a short time.

The market is volitile & no one knows which way its going to swing, people are struggling to sell and in 2/3 years you may find yourself not being able to sell your house or prices could have crashed & you could have loads of negative equity.