Advice appreciated

paul4798

Myself and my wife have the following credit cards

MBNA Bradford & Bingley £2700
A&L also MBNA £2500
Egg Card £4600
Halifax Visa £2000
Debenhams store card (personally hate this one) £600

None of the cards are on 0% and we ahve been advised dont have a particular good credit rating.

Thanks

Paul

Shinds

What kinda advice are u after?

Are those amounts what you owe on each card???

Tim_L

Best advice I can give is to cut your outgoings and pay off your cards (starting with the store card) as fast as you can. Otherwise you are heading for serious debt problems. On cards alone you have over £12K of debt, which will take a while to pay off.

If you can get the debt shifted to 0% (or preferably a low life of balance rate) then you can consider doing so, though you need to watch out that you don't get caught high and dry at the end of the 0% period by a high standard rate.

But don't use low cost credit as an excuse to skip the important bit, which is to spend less. You've already spent more than £12,000 more than you've earned: don't dig yourself into a a deeper hole.

paul4798

So which card do you recommend i change to pref not mnba well I know then i havent much choice there.

Should i go for a continously low rate and various 0% ones?

thanks

Paul

johnllew

On the assumption that the amounts quoted are balances, what are the limits on each card? Also what rates are you paying on each? This information may help members to give you advice on what to do with your existing cards - see Martin's Credit Card Shuffle article.

If you have a bad credit history and are unable to get new cards, that may be your best option.

jellyhead

if you have bad credit you might not be in a situation to get a 0% card. i haven't been. i looked at all my balances and the interest rate i was paying, and it made sense to move the debts around so as much as possible was in the place with the lowest interest rate. write down all of your credit cards interest rates and ask your banks what overdrafts you're allowed. some banks such a barclays will tell you an automatic overdraft amount based on how well you've managed your account with them - they won't credit check you.

barclaycard wouldn't change my student card at 19.9% to a graduate card, instead they gave me a gold card (hubby has an income) but the interest was still 17.9, just gone up to 18.9. my marbles card only charged 14.9. i asked my banks for overdrafts and the halifax overdraft was only 8.9% although they only let me have £850. the barclays overdraft was a higher rate but they have an 'additions' account where if you pay a monthly fee (it's £9.50 now but there are other benefits such as free green flag cover and domestic emergency cover) you get a reduced overdraft rate. i worked out that paying the fee and getting the overdraft interest reduced to 9.9% was cheaper for me than leaving the debt on a credit card. besides which the credit cards charge interest on the whole balance but the overdraft interest is lowered towards the beginning of the month when my hubby's salary hasn't been spent yet!

i moved my debts around so that the bank overdrafts were full, then used any spare money in the budget to pay off the credit card (and paying the interest on my overdrafts so they didn't go over the limit). i used the marbles card for the debts because the interest rate was slightly cheaper than barclaycard. i continued to use my barclaycard for purchases but i paid it off in full every month.

i think that shifting your debt around so it's in the cheapest place is your best option, and working out a budget to see how much you can use for debt repayment. once you've paid the minimum payments to each of your debts (in the case of overdrafts the monthly interest would be the min payment) use the rest of your spare money to pay off whichever debt is the most expensive in terms of interest rate.

i don't know what's wrong with your credit record, but in our case hubby had a CCJ and a couple of defaults. we got these paid off as soon as we could because once these things are shown as settled on your credit record you have a better chance of being given a card with a more attractive interest rate. i recently started applying again for cards and was turned down by egg but texaco gave me a card at 3.9% for the life of the balance so i did a transfer up to my credit limit and then cut up the card. i will pay the minimum every month but don't want to use the card because the interest rate on purchases isn't good. the balance transfer will take a while to pay off, a good few years i think at 3.9% which is not as low as 0% but it's the best deal i could get.

i think having a budget and having a plan to pay off debts is great. even though it will take me ages to pay off the debts at least i'm not spending more than i earn and i pay off my purchases every month. my debt is getting smaller every month and i am sticking to budget and not overspending.

good luck!

paul4798

Thanks John & Jelly yes they are balances but you have probably guessed that they are all near if not smack on my credit limits.

I am going to apply for the texaco card i think and should my wife apply for separate cards to move her debt which is the Halifax and the Debenahms card.

I have no ccj's but a few missed payments i know a big no no but its getting a case of either eating or paying the min payment.

But im glad to say not now as i now do a strict budget you have to and dd for my credit cards.

Thanks

Paul