EddScott

fdtrj

juan

If he can't cut these cards up right now he has a problem.

Can you not pay chunks (such as his bonuses) into these 10 year loan jobbies too?

image doctor

I would suggest he already has a problem if he has 12k debt!

I am constantly amazed at debt threads!

12k over 10 years! Make it 4 years!

When did he actually realise he was spending more than he earned?

HankScorpio

Sometimes you can but on many you'll find that they load up the interest at the start.
In the first few years, if you phone up for a settlement figure, it can be substantially larger than what you borrowed. You borrow 10k over ten years, you get a christmas bonus this year and get a settlement figure, it could be 12-13k even though you've "paid off" a grand up till then.
Having been through this a couple of times, I would say, destroy the plastic, make use of the flexibility to pay extra when you can, maybe write to the company offering a reduced rate due to hardship (they may even freeze interest) bite the bullet and do not take on any extra debt, it'll end in tears. (maybe)

Dunk

iTrader: (1)

Dependant on credit rating, transfer onto a 0% int rate card.
If you're disciplined enough, take out as many as 0% cards as poss, throw the funds into a savings account & use the interest earnt to pay the debt.
Money for nothing & your chicks for free !

D

EddScott

What do you mean dunk?

Max the 0% cards taken as cash into a savings account for the period of the 0% and then put the limit back and pocket whatever interest earned during the 6 months?

Don't some cards charge more for cash advances?

ADP

12k thats nowt

at least 2 people I work with have 25k debt, neither of them have anything to show for it of any significant value. Its all about living within your means.

Why not get a personal loan of the 12k but get it over 5 years or somthing less than 10 at least, at least 5 years seems like an obtainable target mentally. this way you only have 1 payment, but your paying 5 years less interest, which is a lot.

The problem with going with a cheap monthly payment is that hell have more money in his pocket, and thus will be more likely to spend more again......

the person I know who is 25k in debt has in all in 1 loan, and has cut up all credit cards........however just the other day he called a card company and said "Ive lost my card" because he wanted it back to buy a 200 quid digital camera................see a leopard doesnt change its spots, this fella just cant help himself. Though I do sympathise a bit, if you dig yourself a VERY big whole it is often very hard to get out of it........

fast bloke

put it all in a personal load and pay £350.00 a month for 3 years. He will feel the pain of overspending and may become more disciplined. Once he gets the loan and pays the cards, lend him a fiver and register a default against him. That way he will have more diffficulty borrowing more

fitzscoob

To save up for my scoob (well part of it) i stopped drinking for about 10 months, saved up 7grand.

your friend can save any amount he needs, just needs to get his nose to the grind stone, save money. he could pay that off easily in two years.

Dunk

iTrader: (1)

Eddscott,

Barclaycard won't charge you a cash advance fee if they transfer the dosh into a Barclays account. (although interset starts accruing on the draw down of the funds). Transfer the debt from the Barclaycard onto your new 0% card immediately. Leaving you with dosh in the bank (you can then transfer to the savings account) & a debt at 0%.

Alternatively:
Use the balance transfer facility on the the new 0% card to overpay on your current credit cards / loans, you can then take the dosh in the form of a cash advance. (Fees will vary)

Note:
Set up a DDR to pay the minimum each month so that you remove the risk of missing a payment & getting fined.

If someones stupid enough to offer dosh for free & you're disciplined enough not to spend it - take it.

D

OllyK

Depends on the guy's income and outgoings. If he is only on the minimum wage, has to pay rent and has a wife and 16 kids to support, there is no way he will find £12K in 2 years. We don't have eough info to make assumptions like that, we just know he is struggling to re-pay £350 per month, we don't know if he is supporting a £2K per week drug habbit and a penthouse or if he is at home with his parents, never goes out and only earns £400 per month.

Diesel

Cahoot do a very flexible loan at about 6%. Try and pay the bugger off - reduce monthly outgoings by £50 and pay it all off on this lower interest rate. You do NOT want that hanging about for 10 yrs...

Anyway, tut tut spending more than you (oops, your mate) earns, but err, guess what I did with me credit cards and then got that Cahoot loan thingy!! I'm nailing mine thanks to that.

Failing this, get Linda Barker round - snip snip - woof woof!!!

fitzscoob

true, was a pretty big assumption on my part, what i was trying to illustrate was that if hes like me and managed to **** away a lot of money, self discipline can help dig himself out of the hole hes in.

EddScott

Dunk

Sorry to sound daft but is this right?, take out 2 new cards with £3k limits. Take £3K from one and put in savings account. Use other card to do a 0% balance transfer. After 6 months put £3k back and keep interest earned during 6 months?

Could be worth a shot I guess

fast bloke

Edd - you would be likely to make maybe 40 quid???

Boro

iTrader: (1)

Tell him to visit www.moneyfacts.co.uk and check out the best of every option. Personal Loan and 0% Cards. Halifax One are doing 0% for 9months and i think a few more are 9 months now. Transfer a few grand onto them and take out a personal loan on the balance. When the 9 months is up, transfer to a new 0% card but dont forget to cancel the old one.

Katana

If he's got a house, tell him to sell it. It'll give him something like 200-300k to play with once he's gotten rid of his debt to downgrade. He'll then have to downgrade and reinvest in a cheaper property and hope that this house price boom will continue despite analysts saying that it'll stop like ten years ago.

Boro

iTrader: (1)

Selling his house isnt the answer Even IF he has one and even IF its worth £300k. Its £12k not a £100k.

moses

a low cost loan most def or a remortgage if his property is worth something maybe try to get more out of em

and anything left over put it as a deposit against another buy to let house

Markus

I was in a similar situation, had around 13k on credit card and 9k loan, got a consolidation loan from Egg, to combine it all in to one nice monthly payment of 577 quid, for the next five years. I was far to silly with money, and I have learnt my lesson, the very hard way indeed. I do not like knowing I've got another 4yrs left to pay off, but it's taught me not to be such a *****. Sometimes it's the best way to learn.

moses

markus i was the same mate i got a remortgage and i paid of my credit cards and soon as my credit cars were free hmm it got tempting and i got my turbo and stroker

wife doesnt know i have the stroker yet , she is gonna kill me i told her my 800 bhp engine cost me only 2k , lol she aint no jack about bhp or how much an engine costs

MooseRacer

LOL

EddScott

Cheers for the advice chaps. Just to elaborate on the guys position his house is worth £130,000 with the original mortgage being 48K. He's taken a further 20K to pay for house renovation and a car so his total mortage is 68K. Can't sell the place as has wife and kiddie to think of too and won't find anywhere else cheaper. He doesn't want to add more on to the mortgage for fear of the unstable housing market and rising interest rates and having to ask his lender for yet another advance.

The loan was taken to cover some existing debts and buy his misses a car. The cards have just crept up slowly due to the house needing more work and general spending. The two cards he owns are now chopped and after replies on here, the 10 year loan thing is scrapped. We had a look on Moneyextra and a £10K loan over 5 years would be around £193 which seems more managable than 10 years and provided he stays away from cards he may just squeeze out of unnecessary debt by 30!