# Which option is best to pay large credit card bill?



## Rois (5 Feb 2010)

Hi 

I have been given 3 options to clear my credit card bill (it's a UK card).  I am unsure which option to choose.  I am in receipt in SWA at the moment and have some occasional part-time work, but no other form of income. 

As I am unsure which is the best option to take, I have copied them below and would appreciate any advice.

Many thanks

rois

Quote:

"Your account currently has an outstanding balance of £9246.55 and we have not received a payment since the 1st September 2009. Your account is due to default at the end of April unless we can get your account set up on one of the below payment plans:

*Option 1 - £155 Per Month Repayment Plan*

I may be able to stop all interest and fees, on the understanding that payments made will clear the outstanding balance within a 60 month period. I am more than willing to review the fees and charges that have already been applied to the account for February. However we only have till Wednesday 18th to implement this plan on receipt of your income and expenditure details.

*Option 2 - £167 to clear the oldest arrear*

If you can pay £194 to clear the oldest arrear we will also credit your account with a further £194 as a good will gesture for February only.

*Option 3 - £175 Restructure*

If you can pay £175 in February, March and April we will report your account up to date with us and the credit reference agency, the total arrears will be £0.00 and you will revert back to paying your normal min payment shown on your statement."


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## GarBow (5 Feb 2010)

I would snap their hand off with Option 1. A record will show on your credit rating that you have entered into a payment agreement and you will struggle to get credit in the UK but do you really want to obtain more credit there in the next few years?

I am in a similar situation with 3 credit cards all with similar balances. Have entered into an fixed payment agreement with interest frozen on 2 of them. 

It's great to see the balance actually dropping rather than the minimum payment just about covering the monthly interest charges. Now i have to just get the third one to agree to same.

With a balance of £9000 you must have been paying around £160 per month interest.


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## Rois (5 Feb 2010)

Thank you Garbow - I dread to think about the amount of interest I have accrued over the years.  

I can't see any situation in which I will be looking for credit in the UK in the future.  I had this card when I lived in the UK, but moved back to Ireland in 2001. 

I have to say this is my worst debt (of many), but I have found the UK companies much easier to deal and way more flexible than the likes of MBNA in Ireland.


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## GarBow (5 Feb 2010)

No problem Rois,

My largest one in the UK (where i was was living untill 2005) was the same at £9,200. It is now down to £7,700 since entering into the payment agreement a year ago. I could not have dreamt of paying that amount off if the interest had not been frozen. Really is the way to go IMHO. 

I should have contacted them years ago, put it off through fear and embarrassment. Ridiculous really. It was such an easy process. This was with MBNA! Who i had also always been led to believe were a nightmare to deal with. It was all done in two phone calls. 

Good Luck


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## Papercut (5 Feb 2010)

Hi Rois

  It’s good to see that the credit card company are prepared to work with you & are giving you a choice of repayment options.

  To me Option 1 looks like the best. Is this a realistic repayment option for you? Can you afford to commit to it?

  Going by what you have posted it looks as if you have not sent them your income & expenditure details yet. Have you drawn this up & if so, does it show a surplus of £155 per month?

  If it does, well that’s fair enough, but if it doesn’t there is no point in committing to this option, even if you say that you are prepared to cut back on other necessary expenses, as this could well lead to further problems down the line.

  If you haven’t sent them your income & expenditure details, & they do not show a surplus of £155 per month, then you could send them the details & offer to pay a lesser realistic amount in line with Option 1 for a longer period. The amount you offer to pay should be less than your monthly surplus as reflected in your income & expenditure statement. It’s not in your interest or their interest for you to agree to a repayment plan if it’s not a realistic one, so seeing as they are showing their willingness to work with you they might be prepared to alter Option 1 slightly.


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## Rois (5 Feb 2010)

Thanks for all the advice, I have decided to go for Option 1.  I have to send them an income/expenditure breakdown, so I assume they will send me their own form for this.  

Right now I don't have any surplus expenditure - £155 pcm would roughly equal around 200 euros - i.e. 50 euros per week. I can manage this in a couple of ways - I am due a tax rebate from last year, I am due a large SW backlog which I understand I'll be receiving in the near future. However, until I can secure more employment, I should perhaps suggest a lower monthly payment.   

Garbow how do you make the payments - do you have a UK bank account or do you use another method to transfer money?  

Papercut this is also an MBNA credit card and they are so easy to deal with, they are happy to use email for correspondence and it has taken less than a week for them to give me the 3 options.  

Unfortunately, I also have a credit card with MBNA in Ireland and they're a nightmare.

Much appreciated advice.

rois


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## Papercut (6 Feb 2010)

Rois said:


> I have to send them an income/expenditure breakdown, so I assume they will send me their own form for this.


If I were you I'd do out my own financial statement, labelled as your financial statement, signed & dated & send it to the person that you are dealing with. You could have a look through the MABS site www.mabs.ie - if you haven't already, & download a financial statement from there [broken link removed]

You could use that as a basis, & either tailor/simplify it or do out a similar one yourself. The reason I suggest this is that if MBNA send you one to fill in, it will more than likely be quite detailed, & all the information requested might not be entirely necessary. You don't have to name your other creditors (though you would  name them Creditor 1 & name MBNA Ireland Creditor 2, just put Creditor 3,4 etc for any other debts). You may just want to group certain outgoings together as Other Household Expenditure.

That way you will feel that you are supplying them with relevant information rather than them practically asking you what you're going to have for breakfast or how much you spend on toothpaste. Just keep a copy of everything in case either you or they need to review the situation in the future.

I hope everything works out well for you!


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## ccdebtor (24 Feb 2010)

I read somewhere on this forum that UK debt collectors have no powers here, but if they "sell" the debt to an irish company can the sheriff then be employed to accompany bailiffs to your home? I have a u.k credit card debt, which they claim to be over 7,000euro, and I can no longer make  payments because I am now registered disabled, live in a rented furnished house, and the only thing I own is my van, which I need as we live in the country (and being disabled I need transport) I really cannot manage a single penny more going out at the moment as I have a credit card here and am paying off a credit union loan. We have been so cold this winter as we can only afford 20euro worth of coal etc per week and I suffer from depression, which has been worsened with the constant letters and phonecalls threatening  Legal proceedings. So do the debts from a u.k company just get transferred over here?


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