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Onthewayup
Posts: 6 Forumite
Hi everyone.
I’ve just come out of a period of financial desperation. Long story short bereavement, sickness and redundancy all happened one after the other and I took a loan and a couple of credit cards in order to survive. I’m now out the other side and earning really well. My credit score is good but where it says I fall down is my level of commitment. As I’ve been paying the cards off I’ve been having the limits dropped so it still appears like I use a lot of my available credit.
I currently pay £400 a month on a loan with £9000 left on it. I have one credit card (not interest free) with £6000 on that I pay £200 a month off and a credit card (again not interest free) with £3000 that I also pay £200 a month off. I can comfortably afford these repayments now and have been making overpayments for a long time.
I’m at a point now where I’ve struggled for so long and the end is in sight so I’d like to refinance things and reduce the amount I’m paying in interest. I’m scared to apply for anything in case I get declined. (I tried just over a year ago and was declined because of my level of borrowing even though I was going to use the loan to pay off the existing debts). But now I’m earning so much more I’m wondering if I’d get accepted now. It seems crazy to be paying £800 a month on these debts when I could potentially get a loan to cover it all for half the monthly cost.
Sorry for this being so long but if anyone has any advice for me I’d be so grateful. Thanks for reading.
I’ve just come out of a period of financial desperation. Long story short bereavement, sickness and redundancy all happened one after the other and I took a loan and a couple of credit cards in order to survive. I’m now out the other side and earning really well. My credit score is good but where it says I fall down is my level of commitment. As I’ve been paying the cards off I’ve been having the limits dropped so it still appears like I use a lot of my available credit.
I currently pay £400 a month on a loan with £9000 left on it. I have one credit card (not interest free) with £6000 on that I pay £200 a month off and a credit card (again not interest free) with £3000 that I also pay £200 a month off. I can comfortably afford these repayments now and have been making overpayments for a long time.
I’m at a point now where I’ve struggled for so long and the end is in sight so I’d like to refinance things and reduce the amount I’m paying in interest. I’m scared to apply for anything in case I get declined. (I tried just over a year ago and was declined because of my level of borrowing even though I was going to use the loan to pay off the existing debts). But now I’m earning so much more I’m wondering if I’d get accepted now. It seems crazy to be paying £800 a month on these debts when I could potentially get a loan to cover it all for half the monthly cost.
Sorry for this being so long but if anyone has any advice for me I’d be so grateful. Thanks for reading.
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Comments
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Post a SOA on the Debt Free Wannabe board.
A loan is never usually the way to go.
Work more, earn more, cut back on spending.
The SOA will help.0 -
Gary thanks so much for replying. I have already been doing exactly as you said. Cancelled all non essential outgoings and I’ve been overpaying every single penny I can. I’m new to MSE so I’m afraid I don’t know what an SOA is. Could you enlighten me please?0
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Statement of Affairs - http://www.stoozing.com/calculator/soa.php0
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I’ve completed the SOA and, to be honest, it hasn’t told me anything I don’t already know. I’ve been doing the snowballing method for a while now. My priority now is to reduce my monthly payments rather than increase them. That’s why I wanted to consolidate everything into a fixed monthly payment now so I can set up the payment, let it run it’s course and pretend that the last 5 years haven’t happened.0
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So there's zero outgoings you can reduce or cut back on altogether?
No way you can work extra to bring in more income?0 -
I’ve reduced all my outgoings. There’s nothing left to cut back on. I’ve doubled my income this year too. I now have £1500 spare income per month so like I said above I can comfortably afford all my repayments and have been overpaying them massively. I’m at a point now where I’d like to keep a bit more of my money each month but don’t want to only make minimum repayments. So, if I refinanced everything into one, lower, payment I could be paying out £500 a month on the debts instead of £800 and start to save some money.0
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No keep paying them off as you are.
There’s no need to consolidate if you can easily afforded the repayments.
£1500 I’m assuming will make a sizeable dent?0 -
Yes it will. I just need to spend it on other things now. Car needs replacing etc. Thanks for responding. I appreciate it.0
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Why have you been reducing the credit limits if you know it is having this effect. You are making the problem for yourself.Onthewayup wrote: »Hi everyone.
As I’ve been paying the cards off I’ve been having the limits dropped so it still appears like I use a lot of my available credit.0 -
I didn’t realise it was having that effect. I’ve just found that out by coming on this website.0
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