Make Sense of Cards - Need to end CC shuffling

09. Sep 2010 at 15:04

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Need to end CC shuffling (Read 1538 times)

Kid71

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Need to end CC shuffling
09. Sep 2009 at 11:07

his is a good warning tale to anyone "playing" MSE great credit card shuffle who isn't 100% sure they can pay deals in the time specified.

A few years ago -I was self employed contractor through an umbrella company and had 2 years of very erratic good month/ bad month earnings. Needing "just get me through" loans and reading MSE - it became clear that the clever move was to obtain low interest CCs. After several shuffles I'm left with 5 cards with repayments I can afford - but with (now) prohibitive interest rates.

When applying for loans (unsecured) to transfer these to more manageable rates - 2 applications are rejected and I am "referred" to secure hi rate loan providers. I have a good credit rating (920 experian) but I think because I owe a lot no one is prepared to lend me any more - So I feel trapped.

As I am now stably employed with a good income I do NOT want to borrow any more money - but pay off my unsecured loans as a efficiently as I can.

CCCS Suggested a DMP - but I do not want to seriously damage my credit rating. (Will it??)

Loan companies suggesting a secured loan...

Or I could just grit my teeth and "Snowball" the CCS - but this would take me 8 years - and the interest I am paying (up to 27%) is terrifying.

Any advice would be really appreciated! My SOA is below..

Statement of Affairs and Personal Balance Sheet Household Information Number of adults in household........... 2 Number of children in household......... 3 Number of cars owned.................... 2 Monthly Income Details Monthly income after tax................ 3200 Partners monthly income after tax....... 0 Benefits................................ 201 Other income............................ 0 Total monthly income.................... 3401 Monthly Expense Details Mortgage................................ 786 Secured/HP loan repayments.............. 0 Rent.................................... 0 Management charge (leasehold property).. 0 Council tax............................. 107 Electricity............................. 100 Gas..................................... 39 Oil..................................... 0 Water rates............................. 53.53 Telephone (land line)................... 35 Mobile phone............................ 30 TV Licence.............................. 12 Satellite/Cable TV...................... 0 Internet Services....................... 0 Groceries etc. ......................... 400 Clothing................................ 100 Petrol/diesel........................... 100 Road tax................................ 33 Car Insurance........................... 53 Car maintenance (including MOT)......... 33 Car parking............................. 5 Other travel............................ 0 Childcare/nursery....................... 0 Other child related expenses............ 100 Medical (prescriptions, dentist etc).... 0 Pet insurance/vet bills................. 9 Buildings insurance..................... 10 Contents insurance...................... 13 Life assurance ......................... 100 Other insurance......................... 0 Presents (birthday, christmas etc)...... 75 Haircuts................................ 30 Entertainment........................... 150 Holiday................................. 150 Emergency fund.......................... 100 Total monthly expenses.................. 2623.53 Assets Cash.................................... 0 House value (Gross)..................... 195000 Shares and bonds........................ 0 Car(s).................................. 6000 Other assets............................ 30000 Total Assets............................ 231000 Secured & HP Debts Description....................Debt......Monthly...APR Mortgage...................... 140000...(786)......0.73 Total secured & HP debts...... 140000....-.........- Unsecured Debts Description....................Debt......Monthly...APR 0000 barclaycard...............2297......46........22 0007 barclaycard...............3212......71........18 7485 halifax...................11406.....114.......5.94 egg............................14000.....275.......27 9761 lloyds....................10620.....212.4.....20 Total unsecured debts..........41535.....718.4.....- Monthly Budget Summary Total monthly income.................... 3,401 Expenses (including HP & secured debts). 2,623.53 Available for debt repayments........... 777.47 Monthly UNsecured debt repayments....... 718.4 Amount left after debt repayments....... 59.07 Personal Balance Sheet Summary Total assets (things you own)........... 231,000 Total HP & Secured debt................. -140,000 Total Unsecured debt.................... -41,535 Net Assets.............................. 49,465

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Stooz

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Re: Need to end CC shuffling
Reply #1 - 12. Sep 2009 at 17:48

First off, ensure you are controlling what ever it is that causes you to run up credit card debt. For any kind of debt repayment to work - stop the spending that got you there.

Ok, just facts below, not a comment on your life - just trying to "see" things you are missing -

Monthly Expense Details

Electricity............................. 100
Telephone (land line)................... 35
Clothing................................ 100
Life assurance ......................... 100
Presents (birthday, christmas etc)...... 75
Haircuts................................ 30
Entertainment........................... 150
Holiday................................. 150
Emergency fund.......................... 100

I have listed the things that I would take a closer look at to reduce your outgoings - If money is tight - £1800 a year on holidays is excessive. A cottage in wales for a week is £400 - £600 with expenses.
a week at home, and thats your lot for one year leaving over £1000 to hit a card with.

£360 a year on haircuts can be looked at. A cheapo barber can be £6 a cut - 3 a year, and the wife can always let it grow long for a bit...

Life assurance - nice to have, but not when your'e struggling - skip it for a year. - £1200
presents - £900 a year!! you can't buy affection - try charity shops, and cutting back - kids don't need expensive gadgets.

land line - thats a little pricey - what about a change from BT - talktalk do my international free calls and broadband for £20 a month - never pay for calls.

That lot could save you in the region of

£2500 a year better off

0000 barclaycard...............2297......46........22
0007 barclaycard...............3212......71........18
7485 halifax...................11406.....114.......5.94
egg............................14000.....275.......27
9761 lloyds....................10620.....212.4.....20
Total unsecured debts..........41535.....718.4.....-

snowball - you dont like card switching but look at LOB cards (life of balance)
http://www.makesenseofcards.co.uk/lob.php - 8.9% for life of BT is pretty good.
Pound that egg debt or switch it to a lower APR ASAP, dont have to go fro the cheapest cards, but most of them should swap you for less than 27%
Use the extra money saved from above to take a lump out of the debt - every month the minpayment will reduce giving you more snowballing room.

how does that sound?

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