How do I pay off my overdraft?

kate705

Hi there, have been to the bank...they offered mortgage 6.14% plus airmiles. When I rang them 3 days later the product had been withdrawn!! I am thinking of interest only for 5 years as I need a break from this situation. I will then throw everything at the overdraft.
I also asked the bank (Lloyds) about shifting some of the overdraft to a credit card, the woman on the phone said "it doesn't work like that" and explained that the debt would be charged at 29%. I suppose this is a cash transfer? Anyway I have to now investigate cards further. Does anyone know if interest only for 5 years is a bad idea?
Thanks for the help xx

tealady

Hi There is a stopping smoking support thread, it would be worth your while having a look on there as they sem a great bunch.
Dont forget to go a cashback website when you renew your car insurances.
The Old Style board is great for meal ideas, and menu planning. It has saved me loads.
Go onto the Pigsback website for daily clicks. You can save points towards Boots gift vouchers which wil help pay for the phone top ups and toiletries, sign up all the adults in the house.
Hope this helps

MERFE

kate705 wrote: »

Hi there, have been to the bank...they offered mortgage 6.14% plus airmiles. When I rang them 3 days later the product had been withdrawn!! I am thinking of interest only for 5 years as I need a break from this situation. I will then throw everything at the overdraft.
I also asked the bank (Lloyds) about shifting some of the overdraft to a credit card, the woman on the phone said "it doesn't work like that" and explained that the debt would be charged at 29%. I suppose this is a cash transfer? Anyway I have to now investigate cards further. Does anyone know if interest only for 5 years is a bad idea?
Thanks for the help xx

I dont know about the mortgage but with an MBNA credit card you can do money transfer to your bank account to pay off overdrafts and its charged at the normal balance transfer rates, so should be possible to get 0% for the first 12 months then you can transfer like a normal balance transfer to a low life of balance card. I believe there is an egg card that can also do this but not sure as I dont have it, I have done it with the MBNA card.

Treading_Water

I also think that shifting to interest only mortgage may not be the best way to go! You have the surplus funds - you just need to manage them better:eek:

As well as MBNA, the best Life of balance cards seems to be Barclays. You could use a combination of the 2, as I don't think you would get enough credit on one. Don't worry about your credit rating, as long as you pay on time the Credit card companies will fall over themselves to offer you money. We have been doing this for years now. We also found that once we had transferred money out from 1 to another, the first company came back a few months later with a good deal to go back to them.
Good luck in your endevours to clear your debt, I really do think its just about managing your spending better.
TW

cat4772

Hi Kate

I've just had a look at your SOA. You are not in debt crisis which is good news, but like the rest of the country you are feeling the pinch! Your grocery bill is really high and could definitely be cut. Can you shop at your local market for fruit and veg before buying the rest of your groceries at the supermarket?

I really don't think changing your mortgage to interest only will be the best thing to do. As loaner said it won't solve the problem, it will only make you feel that you are coping financially (can afford to continue spending £500 a month on groceries, subsidise your unemployed son and "keeping up with the jones's" by participating in numerous birthday celebrations), and that will cause problems later on.

I really think your biggest problem and the first thing to check are your priorities. Keep on consolidating and accruing more unsustainable debt if it is important to you to 'maintain' your life as it is at the moment. If you want to pay off your overdraft and loan and even pay off your mortgage earlier, then your priorities need to change.

1. plan menus
2. write out a shopping list
3. stick to shopping list when out shopping!
4. give up smoking
5. KEEP A SPENDING DIARY to see where the excess £377 is going each month. If you used £300 of this to pay off the overdraft - the overdraft would be GONE by July 2011 (I used what's the cost and estimated the apr to be 20%). this would leave you with £77 a month.
6. Either save any spare money or throw it at a debt to reduce it faster.

It is important to say that this is achievable.

Good luck.

Cat.x

kate705

Thanks so much for replying,
i was hoping you would say that interest only would be ok short term - 3yrs or 5yrs...it would be an easy solution. I have to speak to OH later again.

My problem I think is my job, its stressful and I work shifts which disrupt my sleeping pattern (notice the time of my post last night!) I have been working more overtime to pay overdraft and I am off sick today and tomorrow, I have a virus and I am exhausted. Due to these working hours my OH has to cook and I sometimes let the shopping and planning slip. Since being on here I have planned my meals (honestly!) and I may now go to Lidl. Instead of interest only mortgage maybe I need a new job - 9-5, I need a more normal life....

Sorry for rambling I know my situation is not that bad but I seem trapped in circumstances that are making me unhappy.


I will get APR for Next and overdraft and post.

Thanks :A

Verbatim

Hi again,

Sounds like you've already made huge changes, menu planning I mean. Hope the benefit shows up soon in the budget!

When we were paying off our cc's I found eating out was what I missed most and so planned to find ways to afford this. I saved £2 coins but mostly planned cheap veggie meals so what was saved could be spent on meals out occasionally. kept me sane.

cat4772

Kate

You have to do what's best for you and your circumstances. If consolidating, remortgaging and moving to interest only for a while are what it will take for you to manage your debts then go for it. Above all, your health is the most important thing.

If you decide to become debt free by reducing outgoings etc, then the best thing is to have a plan. If you have a plan and follow it then it really is a case of one step at a time. Each step may not be very much or you may feel that you are not getting very far but when you look back you'll be amazed at how far you have come.

:grouphug: hope you feel better soon.

Cat.x

kate705

Cat thank you so much... I got very emotional when I read that (!)
I won't do interest only until I have acted on the advice here because I know you are all right. I'm just feeling down and a bit ill....

Just found out Bradford & Bingley may be 'going under' things don't look good out there do they? Think I may go for Lloyds for Mortgage...they are bigger and safe (?)

LEWKI

Hello, just read your thread and came across the anti-smoking messages. I am a smoker but am on my first day of giving up (again!!) - I am doing this purely to save the money. Check out the giving up smoking thread on MSE - its great, a load of us smokers generally ranting and raving about our addiction and how we are getting through it - its actually good fun!
I would get so angry when people told me I was wasting money and I would get very aggitated about the fact I had to give up. It is so easy to delay these things. Good luck and hope to see you on the other board sometime