Debt consolidation loan - Shall I?

Debt consolidation loan - Shall I?

Author
Discussion

Du1point8

21,604 posts

191 months

Thursday 28th May 2015
quotequote all
WinstonWolf said:
Du1point8 said:
Jayyylo said:
andymc said:
Jayyylo said:
Darko92 said:
selling it would only put about 2k in my pocket.
BINGO! Get it sold and you've paid off two cards or one card if that £2k doesn't include cost to change. This may not be appealing but it's a much better option than taking out a loan.
how would he get to work?
Read it again. £2k = 2 cards paid or 1 card paid plus cost to change vehicle.

Having one high interest card paid off will massively help as you can then pay more than the minimum on the other three or pay back a loan quicker.
Or be cheap and if not too far a distance, go lease on a C1, its a few hundred down and £68 a month or so.

New cheap car for 12-48 months and £2k freed up for bills.
You're still paying interest "for nothing" though.
Smaller that 29-39% APR

BGARK

5,493 posts

245 months

Thursday 28th May 2015
quotequote all
WinstonWolf said:
andymc said:
Jayyylo said:
Darko92 said:
selling it would only put about 2k in my pocket.
BINGO! Get it sold and you've paid off two cards or one card if that £2k doesn't include cost to change. This may not be appealing but it's a much better option than taking out a loan.
how would he get to work?
Cycle? At 23 you should be fit enough...
Agreed, cycling around 15 miles each way at this age is easy. Any further use a moped.


WinstonWolf

72,857 posts

238 months

Thursday 28th May 2015
quotequote all
BGARK said:
WinstonWolf said:
andymc said:
Jayyylo said:
Darko92 said:
selling it would only put about 2k in my pocket.
BINGO! Get it sold and you've paid off two cards or one card if that £2k doesn't include cost to change. This may not be appealing but it's a much better option than taking out a loan.
how would he get to work?
Cycle? At 23 you should be fit enough...
Agreed, cycling around 15 miles each way at this age is easy. Any further use a moped.
Good point about a moped smile I do a 36 mile commute a couple of times a week and I'm fifty irked

JB!

5,254 posts

179 months

Thursday 28th May 2015
quotequote all
Darko92 said:
Hello all,

So Ill try be as accurate as possible:

Im 23 and due to a poor set of choices in the last 3 years I've wound up with 4 maxed out credit cards @ 1k a pop. The APR on these ranges from a decent 18% to a shameful 39.9%.

Ive recently started a new job which pays quite well but is a very long drive away so the increase in earning has been out-weighed by the increase in fuel costs etc. This means at present I can only really afford to pay the minimum on all 4 every month. This has been the case for the last 5-6 months at least and I dont see things changing anytime soon.

So here is what I am considering..

Take out a debt consolidation loan from something like Avant (high apr, short term) for 4k with repayments @ £160 a month for 2 years. Yes, Ill be paying a hefty bit of interest but it'll mean I can clear my CC's. The total minimum payments i shell out for all 4 cards atm totals to £200 a month so the loan repayments would be less.

Am I being quite daft?

Poor credit history too btw.
Dec 13 I owed 14k, now down to 5k, You NEED to get off that high interest rate, it will speed up your pay off faster.

If you go for the loan option, cut up your cards and BE DISCIPLINED. My outstanding debt is now 0% for 36 months and cost 1.8% to transfer.

You need to do one or more of the following:
Drop interest
Sell up non-essentials
Work paid overtime/2nd job and use the cash purely to create a rainy-day float.

Bodo

12,368 posts

265 months

Thursday 28th May 2015
quotequote all
Darko92 said:
Indeed it is the E60 but it is part financed and selling it would only put about 2k in my pocket.

As for MSE calc. I was not approved on any of the 0% ones hah.

All this is very valuable so please continue
The most interesting question here is, what rate do you pay for the beamer that had an asking price of 11995?

Could you flog it for an amount where you still have something left over for a small diesel car? What do you plan with the funds that come from selling your E46? Not having to maintain, insure, tax a second car will also allow you to pay off more than £160!

I understand that your commute to work is 55 miles one way. I reckon the BMW will cost you around £0.45 per mile (all included), that sums up to £49.50 per working day, and £990 per month. Imagine what a smaller car that cost 20% less will allow you to lower your loans!

Darko92

Original Poster:

283 posts

110 months

Thursday 28th May 2015
quotequote all
Interest on the E60 is 6% with Motonovo. It was a 5k deposit + 7k financed.

The thing with selling it on is - Right now I am getting almost 600-700 miles per full tank out of the e60 and with a 110 mile daily commute that is working out pretty manageable for me.

The E46 is driven by my dad for local runs + insurance is paid off for the year along with tax and MOT, which is why I feel selling it will not really help the household situation much - but it is smarter, yes.

Having said that, I've taken all the feedback into account and I am actually looking at selling the E60 and E46 and ploughing all the money into my debt and cutting my cards. But I fear that if I am left with almost 1k to buy a car, which has to be a diesel and auto and must transport me 110 miles a day on motorways, I may wind up with a lemon which will cause me further headache.

Another update: Getting a 1.5 Bonus next month from work and that will be used to clear 1 credit card and the other 500 into another. Did some further calculations and realised IF I live like a complete hermit for the next 8-10 months, I can save enough to pay off all the cards without selling any cars.

By hermit, I mean spending no more than £100~ on social outings (This is needed due to where I work, client lunches/team outings etc) and taking food from home every day.

Hopefully, should be manageable.

Jockman

17,912 posts

159 months

Thursday 28th May 2015
quotequote all
Agreed. The running costs of the car alone could be utilised for a much cheaper form of transport post sale? smile

DarylB90

150 posts

110 months

Thursday 28th May 2015
quotequote all
Darko92 said:
Interest on the E60 is 6% with Motonovo. It was a 5k deposit + 7k financed.

The thing with selling it on is - Right now I am getting almost 600-700 miles per full tank out of the e60 and with a 110 mile daily commute that is working out pretty manageable for me.

The E46 is driven by my dad for local runs + insurance is paid off for the year along with tax and MOT, which is why I feel selling it will not really help the household situation much - but it is smarter, yes.

Having said that, I've taken all the feedback into account and I am actually looking at selling the E60 and E46 and ploughing all the money into my debt and cutting my cards. But I fear that if I am left with almost 1k to buy a car, which has to be a diesel and auto and must transport me 110 miles a day on motorways, I may wind up with a lemon which will cause me further headache.

Another update: Getting a 1.5 Bonus next month from work and that will be used to clear 1 credit card and the other 500 into another. Did some further calculations and realised IF I live like a complete hermit for the next 8-10 months, I can save enough to pay off all the cards without selling any cars.

By hermit, I mean spending no more than £100~ on social outings (This is needed due to where I work, client lunches/team outings etc) and taking food from home every day.

Hopefully, should be manageable.
Sign up to this OP

http://www.profitaccumulator.co.uk/

Been doing it for 3 weeks and made £800
You'll have your £4K in no time smile

Du1point8

21,604 posts

191 months

Thursday 28th May 2015
quotequote all
DarylB90 said:
Darko92 said:
Interest on the E60 is 6% with Motonovo. It was a 5k deposit + 7k financed.

The thing with selling it on is - Right now I am getting almost 600-700 miles per full tank out of the e60 and with a 110 mile daily commute that is working out pretty manageable for me.

The E46 is driven by my dad for local runs + insurance is paid off for the year along with tax and MOT, which is why I feel selling it will not really help the household situation much - but it is smarter, yes.

Having said that, I've taken all the feedback into account and I am actually looking at selling the E60 and E46 and ploughing all the money into my debt and cutting my cards. But I fear that if I am left with almost 1k to buy a car, which has to be a diesel and auto and must transport me 110 miles a day on motorways, I may wind up with a lemon which will cause me further headache.

Another update: Getting a 1.5 Bonus next month from work and that will be used to clear 1 credit card and the other 500 into another. Did some further calculations and realised IF I live like a complete hermit for the next 8-10 months, I can save enough to pay off all the cards without selling any cars.

By hermit, I mean spending no more than £100~ on social outings (This is needed due to where I work, client lunches/team outings etc) and taking food from home every day.

Hopefully, should be manageable.
Sign up to this OP

http://www.profitaccumulator.co.uk/

Been doing it for 3 weeks and made £800
You'll have your £4K in no time smile
why is that arb betting better than any other?

g35x

93 posts

182 months

Thursday 28th May 2015
quotequote all
Darko92 said:
Whoops screwed up the details there.


In terms of outgoings and income. I have budgeted my entire day to day life and because of the mortgage I'm covering and extra bills and car costs etc I'm left with peanuts as disposable income.
Ultimately this is going to be a barrier, you can't afford the lifestyle you are currently living. Until you address that by either seeking out a better paying role, or adjusting your lifestyle any action you take will only provide temporary relief.

Why not sell the house and get somewhere closer/cheaper ?

DarylB90

150 posts

110 months

Thursday 28th May 2015
quotequote all
Du1point8 said:
why is that arb betting better than any other?
It's matched betting, not ARB betting.
I'm not saying it is better than any others but it's the one I've been using and it works so why not recommend it.

Darko92

Original Poster:

283 posts

110 months

Thursday 28th May 2015
quotequote all
g35x said:
Ultimately this is going to be a barrier, you can't afford the lifestyle you are currently living. Until you address that by either seeking out a better paying role, or adjusting your lifestyle any action you take will only provide temporary relief.

Why not sell the house and get somewhere closer/cheaper ?
I agree - The lifestyle is slightly more extravagant than should be. The only reason for this is due to the fact that I was going out far too much. Maybe 4/5 times a week and @ a minimum of £20 a week per night that does rack up quite a hefty amount.

Luckily, I've cut that down now. In May I went out once haha.

In regards to selling the house etc, it's not possible. It is my parents home and our family home so I cannot do that.

I can see though that debt consolidation loans are a literal no go - I read up about people with 20/30k of Credit Card debt and I refuse to let myself rack up any further debt. I've actually just cut up the two high interest cards and have re-adjusted my budgets so I go out a minimal amount and save every penny. Hopefully by making a few sacrifices ill be on the road to being debt free smile Birthday money/Xmas money etc will all be put towards this.

Du1point8

21,604 posts

191 months

Thursday 28th May 2015
quotequote all
DarylB90 said:
Du1point8 said:
why is that arb betting better than any other?
It's matched betting, not ARB betting.
I'm not saying it is better than any others but it's the one I've been using and it works so why not recommend it.
Send me more details via PM, all the ones that I see for match betting normally all look like fake statements by bot style interviewees.

Then its too good to be true and something goes a miss.

I would like to know the minimum that you can keep in the account to make the money, if the guy is just making money on subscriptions service or elsewhere, if you need to be super quick to put your bets on otherwise could lose out, etc.

Bit more info please if you don't mind.

DarylB90

150 posts

110 months

Thursday 28th May 2015
quotequote all
Du1point8 said:
Send me more details via PM, all the ones that I see for match betting normally all look like fake statements by bot style interviewees.

Then its too good to be true and something goes a miss.

I would like to know the minimum that you can keep in the account to make the money, if the guy is just making money on subscriptions service or elsewhere, if you need to be super quick to put your bets on otherwise could lose out, etc.

Bit more info please if you don't mind.
No worries mate
When I get in I'll drop you a message

Darko92

Original Poster:

283 posts

110 months

Thursday 28th May 2015
quotequote all
DarylB90 said:
No worries mate
When I get in I'll drop you a message
Could you PM me too? I would like some more info on this actual betting thing. No idea how it works

chrisispringles

893 posts

164 months

Thursday 28th May 2015
quotequote all
At the very least, shift the 325. You should make £2-2.5k for it which is big chunk of your debts cleared and you're probably spending at least another £2k p/a in fuel and maintenance. You say your dad uses it for local runs, but is it really necessary for him to drive and if so, wouldn't something cheaper and less thirsty be a little more sensible?

g35x

93 posts

182 months

Thursday 28th May 2015
quotequote all
Darko92 said:
I agree - The lifestyle is slightly more extravagant than should be. The only reason for this is due to the fact that I was going out far too much. Maybe 4/5 times a week and @ a minimum of £20 a week per night that does rack up quite a hefty amount.

Luckily, I've cut that down now. In May I went out once haha.

In regards to selling the house etc, it's not possible. It is my parents home and our family home so I cannot do that.

I can see though that debt consolidation loans are a literal no go - I read up about people with 20/30k of Credit Card debt and I refuse to let myself rack up any further debt. I've actually just cut up the two high interest cards and have re-adjusted my budgets so I go out a minimal amount and save every penny. Hopefully by making a few sacrifices ill be on the road to being debt free smile Birthday money/Xmas money etc will all be put towards this.
Tough gig, especially having to carry your parents mortgage. Good job taking accountability for the debt, a lot of people don't.

Long term though how is this going to play out, what term is left on the mortgage ? You need to have some form of life and discretionary spending.


Darko92

Original Poster:

283 posts

110 months

Thursday 28th May 2015
quotequote all
Cheers guys.

It's a difficult topic and often its people denying their own mistakes but I'm aware this is all my doing.

Funnily enough I can't shift the 325 right now. The cluster is dead and not working so until that gets fixed it won't be shifted. But yes that is a strong possibility. However dad uses it for work too and his monthly petrol is 150. If I get rid of it it's 120 for him by public transport. I think it would make sense selling the 325 once the insurance etc runs out. If I sell now, my e60 insurance will go up by approx £400 as its multi car.

In the long term the mortgage won't be an issue. Dads on an employment break at the moment so once he's back to work we'll be splitting it. For now, I just need to control my spending and live a little more like an introvert and sacrifice on luxuries. Once the debt is all clear (2 year target) my pay should be up by a further 10k. (Graduate scheme which promises 10k hike after your first two years) and I can begin a clean slate.

Simpo Two

85,148 posts

264 months

Thursday 28th May 2015
quotequote all
My accountant drives a Focus diesel he got from the local auction for about £700.

That's an extreme example but the concept is that you find a car that is much cheaper to own/run than what you have - which means you clear the debt and interest sooner and then start saving real money. And yes, bin the luxuries until you're in the black.

BGARK

5,493 posts

245 months

Thursday 28th May 2015
quotequote all
All the good advice on here and you are going to consider gambling, game over!