The Damoclese saga - will this work?

Damoclese

Tried to get a £16k unsecured loan and was offered £10k by Halifax, which i gladly took. After looking at all my remaining credit cards, thought i may be able to clear everything in about 7 years... but saw a small problem
on checking my TSB account. After talking to the enquiries, when it said online that my account had been closed, what they really meant was no more money could be drawn from the account until pending funds had cleared. Then they suggested i enquire about a loan as the interest is less that on my C-Card.

Long story short, they asked if i wanted £3.3k to clear the card and i asked if i could make it £5k as i had other cards - got the ok and the letter i just signed tonight.

Checked my bank account again tonight and there's another £600 that has come off that i thought was already off :eek: This could be REALLY tight.

Income £1020
Expenditure £578.32

(BUT in May i get £1k bonus and a payrise to about £1070)

Expenditure is pretty much set as i live with my folks and only have rent and rail fares to pay. Could cut it down a little on the lunches, but nothing else.

Debts:
Halifax Loan £10k @ 7.9% (£245.71pm) (no PPI)
TSB loan £5k @ 10.9% (146.37pm) (no PPI) + still to be allocated**

TSB C-Card £3843.53 @ 27.95% (2% min) :mad:
RBS C-Card £3320.99 @ 24.95% (2.25% min)
Halifax Card £2561.20 @ 15.95% (2% min)
TSB overdraft £0.00 (up to £100)

I have a few months grace before the loan repayments start so what i was thinking was:
1. clear the TSB card in full with part of the TSB loan
2. put the remainder of the loan towards RBS
3. when i get my bonus put it towards the RBS card

Question is though, as the payments on the loans won't start for a few months (don't know exactly when) instead of throwing everything i have at the RBS card should i do that a month later and retain some extra cash so that i'm not short on the card payments?

Hope that makes sense.

I know it will still be tight, but i'm hoping that i can get a 0% Balancetransfer deal with TSB in a few months and transfer the RBS and Halifax debts across, then maybe back again if i can get a deal later with them.

Any advice and comments welcome. The TSB letter is still sitting here freshly signed but not yet sent. Is this workable or any ideas what i should do? I've probably had too many credit checks to try anything else, but all suggestions are welcome.

Bismarck

Hi, well done for posting.

I get the feeling something's missing here....what do you need the TSB loan for? Isn't the 10K loan enough to do the job....I assume the 10K was for some other cards, if so what are/were they and what's happened to them?...you don't want a second loan for no real reason, just because they offered it to you...banks aren't your friends! At best it's a kind of mutual agreement, at worst it's....yuck...they're trying to sell you more debt that you may not need.

Damoclese

The £10k went in part to the TSB card and i paid off a family loan. I had hoped originaly to get more than 10k to do this and was going to wait a while longer, but i didn't know they were also having a few difficulties. When i mentioned that i had got a loan to pay off some of my debts from when i had been ill, the relief on their faces was almost palpable. I think they hadn't planned properly for a tax bill or something.

I showed the £5k as unallocated so you could see exactly what kind of mess i'm in. I'd need about £200 just to make the minimum payments and with £245 already for the loan, with the 2nd loan i would need £500 to cover the minimum but i have a few months without paying for the loans and am getting that bonus and raise, so that will be £475 required. £5k of which will not be at 26+%

Definately tight, but i think i can do it.
Can't i? Aaaargh

Bismarck

If you don't do it, what are the options? ...thought so...back to plan A!

Key thing is to look at the cards you've got and the likelihood that they'll give you a good "shuffle deal" to get the balances off those killer rates...is it a good chance you'll get a 0% rate from TSB in the future for the CC? I'd do a bit more research on that one first- I've got to know my CCs pretty well over the years but they still surprise you...sometimes in a good way....some offers are useless and yet some are just what you need!

gotta go...keep planning!

Damoclese

I think i'll post it off at lunchtime. Possibly only make the minimum payments until i get the bonus and payrise, then throw everything i've got left at it.

Anyone else able to comment?

Benthosboy

I agree with Bismarck. I recently applied for a £15K consolidation loan from the Halifax which I didn't get. Obviously the Finance Gods were smiling on me that day. When I later did the Snowball calculator, I realised that while the loan would have taken 4 years to pay off and cost me £5K in interest, Snowballing will pay all the cc debts off in less than 18 months and cost me around £1K in interest. Guess what I'm doing?

The Halifax did do me a 0% deal for 6 months so I b/t'd most of my TSB onto the Halifax cc and when the 0% deal ends, I shall transfer as much as I can onto the Virgin card I've just got.

Martyn.

pania

don't run away, just taking a look, but it's early.. and my brain is slow....right back in one second.
before i do what are the outstanding balances on the credit cards?

pania

dammit, you ran away.....:o :rotfl:

Karmacat

Question is though, as the payments on the loans won't start for a few months (don't know exactly when) instead of throwing everything i have at the RBS card should i do that a month later and retain some extra cash so that i'm not short on the card payments?

Hi Damoclese

Those cc rates sound horrendous... but I'm really confused by what you've posted, sorry .... if you're paying off the cards, why would you need to retain money for card payments? You still have one card and some left on one that you're planning to pay off, but that will be a lot easier.

What about getting some more money coming in? A second job? Even a bar job - you're in a nice atmosphere, and not spending.

pania

76.87
Ok, so the way that i see it is this.
minimum repayment on TSB card = 76.88
minimum repayment on RBS card = 74.83
minimum repayment on halifax card = 51.23
Halifax Loan repayment = 245.71

total for debt repayments = £448.55

Monthly total with expenditure = £1026.87

Please please do not keep any money back from the loan, if you do decide to go ahead with it. I and many others have learnt from bitter experience that the money will be used on something, anything other than debt repayment.
What you also need to do if you do dispose of a card is to do just that. close the account so there is no temptation to run it back up again.

If you take the loan....

Halifax loan 245.71
TSB loan 150

RBS Card minimum payment 48.69 (based on balance of 2164)
minimum payment on halifax 51.23

Total for debt repayments £495.53!!!!!!!!!! why do you want to INCREASE your monthly expenditure?

It would be best for you to continue as you are i think but look at the balances on your CC's. Do you have any outstanding balance on any of the credit cards that you could transfer some or all of the TSB card across to? The others are right, yes the interest is cheaper but what is the total amount that you will pay back at the end of the loan term?
Have you looked at other credit card companies to see if you can get a balance transfer now on 0% (say, goldfish through quidco?) much much more effective than this loan.

Investigate that possibility, have a look at the limits on your cards, show us that expenditure, i bet theres a few places we can cut down a tad for you, and see what you can do here re maximising your income, loads of the guys here do matched betting and things like that to get the cash to pay off their debts. Are you single? how about bar work of a saturday night, great fun and you get paid for socialising.. think outside the box a little here and for inspiration look at James240's diary, started in much the same place as you have, now debt free and found himself a girlie on here to boot.
TSB only want to make money from you... DON'T LET THEM!!!!!!!!

Big hugs
P
xxx

1156.47

Karmacat

Pania, thanks for doing this - I can't make sense of this either, its obviously me not damoclese then, as to why I can't follow his post. Sorry Damoclese - I trust Pania's ideas, and I trust her maths and finance skills, so for me, this post is "what she said."