life with debt??

frogfish_2

HI

this site has just been reccomended to me, I have been away for 2 years and I am now in a substantial amount of debt.

I have not the knowledge or inclination to know what to do for the best, I have a loan with cahoot £5000 being paid back at £92ish a month (8.9%) that i can cope with but I now have £650 on a Lloyds credit card and £700 on a nationwide credit card ( I switched cards to stop interest but it didnt seem to work) My current Lloyds account is about -500 and another store card -200.

I do not get paid until mid August from a new job, no advance possible. Does anyone know of a good way I can lump all debt together and have one payment going out so I can sleep at night?! Or can I transfer the balance of the credit cards to someone others?
Any help gratefully received as this is not my speciality

thanks

reddevilled

Hello,

You've made the first step by posting on this site. There will be lots of people whowill give some good advice here.

You can get 0% balance transfer cards which will alleviate some of the initial burden, however you still need to make minimum payments and you still need to figure a way of reducing your outgoings so that you are not simply deferring the problem for the life of the balance transfer.

Also, if you do go the balance transfer route, destroy the card afeter you have transferred the debt so you can't max the card out with further debt.

Look at virgin and egg cards which you can transfer from your current account, thereby getting at some of the cahoot loan as well.

Do you still spend more than you earn, if so it may be worth posting a summary of your incomings and outgoings so that people can help with that also.

Good luck!

mountainofdebt

Can I ask a few questions?

What type of loan do you have with Cahoot...is it a flexible loan and if so what's your limit?

What's the apr and credit limits on your Lloyds and Nationwide Cards?

It might also be worth posting details of any outgoings/income so someone can see if any savings can be made.

frogfish_2

mountainofdebt wrote:

Can I ask a few questions?

What type of loan do you have with Cahoot...is it a flexible loan and if so what's your limit?

What's the apr and credit limits on your Lloyds and Nationwide Cards?

It might also be worth posting details of any outgoings/income so someone can see if any savings can be made.

Thanks for reply, Im not very organized, have no idea about loan or LLOYDS/NATIONWIDE RATES. But I will check, yes I can hear you all say no wonder they're in Debt!!!

But have applied for an Egg card and they say YES so thats £3500 limit at 0% until January I believe so I take it I can pay off my other cards with this and have a bit of breathing space?

mountainofdebt

Yes you can trasnfer all your card debt onto your new egg card however please do the following:

1. Once you have cleared all your cards cancel them ....don't cut them as you'll always have it in the back of your mind that you can phone up and get replacements and start spending again .....and you'll end up in a worse position that you were in before.

Do you intend to withdraw all your available credit with egg? If so, what do you intend doing with the surplus once you've paid off the card debt? Do you plan on paying off some off your Cahoot loan?

If you do plan on withdrawing it all PLEASE PLEASE make sure that you use it to pay off EXISTING debt otherwise you will end up in a worse position.

2. Either way work out what you can afford (hopefully more than the minimum on both the cahoot & egg debt!) and then make the minimum payments to egg whilst throwing the rest at Cahoot. This is called snowballing and the snowball calculator can be found at https://www.whatsthecost.com/snowballing

NEVER NEVER NEVER spend on the egg card ....any payment you make will go towards the balance attracting 0% leaving everything else to attract interest.

ffs

Well done! You have found a way of minimising the cost of your debt. Unfortunately this now puts you in a position where you will have access to more credit, which despite mountainofdebt's warnings, you will probably use if you find yourself in a new financial crisis.

No one ever intends to use the credit card they hide at the back of their drawer for emergencies, but it is pretty much garanteed that you will draw on this emergency credit facility because emergencies always happen.

mountainofdebt

!!!!!! - I agree with you ....for any advice to work you usually have to take on board all comments...and hopefully frogfish will realise that my comments speak from experience when I say that if (s)he doesn't CANCEL the cards (s)he is only storing up bigger trouble for the future.

Frogfish...when you do start receiving a salary, why not put some money away for emergencies? I've found have a dd set up the day after pay day is the best.

Debt_Free_Chick

frogfish wrote:

Thanks for reply, Im not very organized, have no idea about loan or LLOYDS/NATIONWIDE RATES. But I will check, yes I can hear you all say no wonder they're in Debt!!!

But have applied for an Egg card and they say YES so thats £3500 limit at 0% until January I believe so I take it I can pay off my other cards with this and have a bit of breathing space?

Cut up ALL the cards ... including the Egg one!

frogfish_2

Thank you all for info and advice, very grateful. Will pay off 2 credit cards so that will leave about £2000 I hadn't considered what to do with this. Paying off loan would seem a good idea..
My Cahoot loan is flexible but I don't know over how long. I also applied for a Virgin card...after reading about super balance transfers but really don't fully understand if that would help me.
As for putting savings away from wages, great idea but most of that money is spoken for, moving house etc. But I will try and DD something...

mountainofdebt

Forgfish...DON'T FORGET TO CANCEL YOUR EXISTING CARDS WHEN YOU'VE PAID THEM OFF!!!

If you've also applied for a virgin card and you intend paying off the cahoot loan with the virgin card ....make sure that you a) cancel the cahoot loan and b) keep the repayments the same as they are now otherwise YOU WILL GET INTO A WORSE MESS THAN YOU ARE IN NOW.