Any advice?, what should I choose?

Dog_on_wheels · 11 July 2004 at 10:04PM

Hello there

I currently owe around 13k on :

Overdraft : £3500

Credit cards : £9500.

Now, I am at a point where it's getting a bit silly, and I need to start to prioritise and pay off these debts. I have the £6500 spread over 5 credit cards, owing between £1000 and £4500 on various cards.

The £4500 has 0% for a further 6 months, but the other stuff I am paying high intrest on.

I am either going to get a loan, or another credit card to put all my debt on. I pay between £500 - £1000 pm off these debts and they are not increasing, but I am mainly paying off intrest and a small amount of the debt every month. I really want to get rid of my overdraft as I am being charged £45 per month for using it, and I get charged a fair bit on my cards too.

Ideally, I would not want a loan, as some months I can pay a lot off my cards, and you are more tied to a loan. So I guess I am asking if anyone knows the best way to spread this debt or the best credit cards to go for.

Any help or advice would be greatly recieved.

[Deleted User] · 12 July 2004 at 4:19PM

If the above are your only debts and you do not have other higher priority debt - i.e mortgage,council tax,
Inland Revenue,court fines - then you are better off trying to switch the credit card debt round the 0% deals.

With 5 cards to juggle you could still find yourself running out of options so try and go for the largest credit limit on one card that you can get and transfer as much as you can in one go. With the £4,500 still having 6 months to run at 0% it may be possible to transfer more to it rom one of the other cards? CHECK WITH THE COMPANY FIRST in case this invalidates the 0% or incurs interest on what you add.

Barclaycard are doing an offer at the moment for 13 months 0% - but I think you have to balance transfer by August - but worth checking. I think there may again be one or two 9 month 0%s about - possibly Halifax?

Check out Moneysupermarket.com for the up to date comparisons on credit cards.

Regarding the overdraft, you may just be stuck with it for the time being - so if you can get all your credit card debt onto 0% cards - then I would suggest pay off the minimum each month on those, provided they are on 0% - and hammer the overdraft with as much as you can throw at it. The overdraft is what is costing you the most - the rest of your debt on the credit cards can be kept ticking over on 0%. You will need to be vigilant and organised and ensure you apply and swap to new 0% deals in plenty of time to prevent incuring interest.

It probably goes without saying but I'll say it anyway - you need to STOP spending further till you get things under control - and NEVER spend on the cards you transfer balances to.

DiggingOut · 13 July 2004 at 4:05PM

Never spend on any card unless you clear the balance each month. Otherwise you pay interest from the date of purchase.

You might try an MBNA card if you don't have one, they seem generous with credit limits, and you can do a balance transfer to pay off your overdraft with it. You might be able to get 12 months at 0%.

If you do have an MBNA card, you might just call them and explain how much debt you have on cards/overdraft, and ask them if they will give you a deal to transfer that debt to their card. You might get something like 2.9% for six months or even better, maybe even a life of balance offer.

If you are able to pay more some months, most loans are a bad idea. Cahoot has a flexible loan that allows overpayments. The rate is higher than some other loans, but still better than your credit cards.

The best thing you can do is stop buying things, stop going out, don't spend on anything that isn't absolutely necessary, and pay off the debt. The less you owe, the less interest you are paying to make the banks rich.

Any advice?, what should I choose?

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