I need to be debt-free! HELP

Mjfender26 wrote: »

Okay, So after a long conversation at work with my manager, He has agreed to supply me with a work vehicle, So this means i can sell the work van, and be left with the "work supplied vehicle".

Secondly, I have also thought about "Downgrading" my "personal" vehicle to something cheaper, As it is on a Hire purchase agreement, I am unknown on my options.

What options, if any, do I have to either "Downgrade" or swap my current car for a lower priced one?

Does it mean I would have to re-apply for finance? As explained, my credit score is atrocious, and my chances of being accepted on finance is little.

Thanks.

Great news. Not having the two car payments will free up so much extra income for you!

Which one of the two HP loans was for the Van?

Downgrading could be a good idea, but how is the car you have now? Based on the values you gave, there isn't a huge amount of room to go lower, and will likely come with the unknown possibility of getting a lemon that could end up costing more in repairs...

If your current car is OK and could go on another few years, I would be tempted to just use the surplus income from the reduced HP loan on the Van (based on the values you gave, you won't clear the HP loan in full so will still have some payments to make) and pay off the current car HP loan even quicker. A high APR loan with short duration is equivalent to a low APR loan with a long duration so...

You might need to sit down with a spreadsheet and work out how to pay off the remainder of the HP loan on the van, and the HP loan on the car you have though. I would add them to your debt snowball and attack the one with the highest APR, just as you are with the other debts.

Once the loan is paid, you can start to change your behaviours. Address the root cause of the issue so to speak. Pay off the debts, start putting money away and get into the mentality of saving and paying for things with cash, rather than always looking to borrow to pay for things. Loans are just ways of borrowing income from your future self, but also paying the banks for the convenience in the form of interest. Rather than paying a £300 loan back every month, save £300 and get interest paid to YOU!

Hope that helps.

Great to hear you doing so well! I have been in a similar situation with poor credit rating and outstanding debts. I have been paying back what I can (minute percentage compared to overall debt - but something) consistently for the past 9 or so months. My credit rating (Experian) has hit poor for the first time in years! It!!!8217;ll get there... just takes time. Your debt will be gone in no time if you continue as you are! Well done!