Advice Needed

sheep1903

Hi,
I am new to this site, and this is my first post.
I am realy looking for advice on how to lower my debts.
my situation is:

I have 2 personal loans, 1 @ £5000 with 2 years left and 1 @ £4000 with 3.5 years left.

I also have a car loan with 2.5 years left.

I have a Barclaycard with a £750 limit, with nothing left to spend. I would like to transfer the balance, but have been refused cards from other lenders, although I dont clear my card balance every month, i do pay more than the minimum.

My credit history is considered poor.

alltogether its about £550 per month on debts ( 60% of my income ), I am able to pay these every month, but it dosn't leave much to spend on other things.

Am i better to struggle through the next 2-3 years or is there anything i can or should do now.
Thanks

westernpromise

Hi Sheep,

Welcome to MSE.

It would be helpful to know a little more about your situation and then we can give you some pointers, both generally and hereabouts on the site.

What are the outstanding balances on your loans, who are they with, and what is the interest rate on each? Does either of them include payment protection insurance or similar?

How much is your car worth? Is the car deal bundled with anything else such as free insurance?

Who do you bank with? Have you tried approaching them for assistance?

Have you had a look at your other outgoings and thought about what you could cut back on to release some cash?

What are Barclaycard charging you and what makes you say your credit history is poor?

Let us know if you can.

sheep1903

lets see,
I am paying Citi 26.3% on a £5000 loan ( plus £1400 for Payment Protection) with 2 years left @ £175 per month

also Black Horse 14.1 % on a £4000 loan ( plus £1200 for Payment Protection) with 3.5 years left @ £170 per month

The car is £190 per month + £30 p/month on payment protection, and did come with 1 years free insurance, the car was about £9000. There is about £5000 left to pay.

The Barclaycard interest is 24.9%. I have tried to apply for other cards to do a balance transfer, but have been declined a few times, by MBNA, Capital One, Egg.

My mortgage is only 8 months old ( my first flat) @ £160 per month @ 6.29% variable with Nat West.

The reason my history is so bad started about 10 years ago when I was 18, I took loans & credit cards, a relationship break up meant i had less money coming in and had difficulties. Over the last 2 -3 years things are getting better with reguards to paying reguarly.

I can afford and do pay these debts every month, but it does leave things a bit tight. I was just wondering if i should do anything to make it easier for me.

Debt_Free_Chick

OK .. you need to understand why you were declined for the cards. A good place to start is to get hold of your credit report. You can apply online to have these posted to you at £2 each or you can pay extra -about £8- to get online versions, that you can view immediately & print out if you like.

Start here

https://www.experian.co.uk

https://www.equifax.co.uk

When you apply for credit (ahem, debt!) the lenders use this report to check a number of things

1. How much debt you currently have
2. How much the repayments on existing debt cost you
3. How much "available" debt you already have e.g. approved credit limits on cards you've not yet spent

They also check that you are on the electoral role at your local council.

Now it looks like you moved 8 months ago, so you may not be on the electoral role. If that is so, then you don't get past first base. But if that's the case, I would call one of the cards who rejected you and explain - there's often a way around it, if you can prove where you live.

So get your credit reports and study them very carefully. Read the online help at the Experian & Equifax websites, to decipher your reports. And post back if you have any questions.

HTH
Regards

Rafter

If you have had your barclaycard for a while and have a good recent repayment history, try giving them a call and ask for a rate reduction or say you will look elsewhere.

Can't hurt.

If you have a mortgage with Nat West, try them for a loan or card as well. Particularly try and pay off that Citi loan early which has a crippling rate of interest.

Good luck.

R.

westernpromise

My mortgage is only 8 months old ( my first flat) @ £160 per month @ 6.29% variable with Nat West.

OK, the interesting thing is that despite your credit history and a lot of pre-existing finance, you were able to get a mortgage, in an amount which presumably reflected your outstanding commitments.

I would think about going back to NatWorst and asking about extra mortgage borrowing, explaining that it is specifically to pay off other outgoings.

Since this is secured credit, they are evidently more prepared to lend to you than others are. Normally, secured loans are a bit of a no-no, but in this instance you have a secured loan anyway - your mortgage - and a 20% reduction in your interest rate will save you thousands.

At any rate it will cost you nothing to ask.

The other thing you can do, and this is more speculative, is read the T&Cs of those payment protection policies and see if there are any exclusions that would prevent you from claiming under them. Eg if your work is seasonal, you usually can't claim. If there are, it might be worth trying to get them cancelled on the basis that they can't ever be claimed on, and are surely therefore an unenforceable contract.

I have no idea if this is actually feasible or valid in law. Again, it has to be worth a try.