Re: Advice about getting out of debt
<!--EZCODE BOLD START--> Liam says:<!--EZCODE BOLD END-->
If your mortgage lender will do a top-up on your mortgage at homeloan rates with no fees, that's an option (First Active Utopia springs to mind). But don't fall into the trap of borrowing over a longer term than you need. If you can afford the repayments, take the top-up over a term of 5 years or less NOT for the same term as the rest of your mortgage. If your lender insists on legal and valuation fees for a top-up, have a look at re-financing the entire mortgage.
<!--EZCODE BOLD START--> Joe Public says: <!--EZCODE BOLD END-->
There's one source of finance that's even cheaper than a mortgage top-up - MBNA's introductory credit card rate of 3.9%. Provided you think you can clear down your existing debt over six months, this might be the answer.
<!--EZCODE BOLD START--> garrettod says: <!--EZCODE BOLD END-->
In addition to MBNA, there are other Promo Rates out there:
Ulster Bank have a credit card with a promo rate of 3.9% for balance transfers - first 6-months.
Tesco Visa offers a Promo Rate of 5.9% (?) for 6-months on balance transfers.
AIB offer a Promo Rate of 6.9% on balance transfers for 6-months.
I suggest that each time a new account is opened, the full balance be transfered, the old account closed, the new card be cut up immediately, a standing order be created for 6-months, covering whatever amount you can afford to repay (min being 5% of bal outstanding).
By setting up the standing order for 6-months at a time, you can chip away at the balance outstanding, ensure you cover interest payments (& avoid additional charges), while managing your other debts.
Use a diary system to monitor your progress & remind you to transfer your balance again after the 6-months
stop using your credit cards - with No exceptions
But there are two big pitfalls - if you run up new debt, MBNA will charge interest at 16.9% (the 3.9% applies only to balances transferred from other cards); and if you don't pay down the balance within six months, the rate of interest on everything jumps to 16.9%.
If you go this route, it might be best to cut up the new MBNA card as soon as you receive it and just keep chipping away at your outstanding balance.
<!--EZCODE BOLD START--> tedd says:<!--EZCODE BOLD END-->
Look at the rate of interest you are being charged on loans and credit cards. Pay just the minimum payment on the cheapest ones and put the rest towards the loan with the highest interest rate, so that it gets paid off first.
<!--EZCODE BOLD START--> sarahmc says:<!--EZCODE BOLD END-->
I know, I know it makes fiscal sense to attack the loan with the highest interest rate first, but personally I attacked mine smallest outstanding amount first.
It gives a real buzz to be able to tick one loan off the list and move onto the next one.