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Freezing interest on credit cards

(19 Posts)
Ijustworemytrenchcoat Sun 08-Feb-15 14:14:10


I was wondering if anybody had had success contacting credit card companies and asking them to reduce or freeze interest rates? I have changed from a DD to a fixed amount Standing Order but the interest rates are nearly 25% and I am not seeing any difference.

I thought if I could lower or freeze the debt I could rattle through it by continuing with my normal repayments.

If they agree what effect will this have on my (admittedly already poor) credit rating? It's just if they are going to put it as a default on my file I may as well see about setting up a DMP through a charity.

LIZS Sun 08-Feb-15 14:17:07

Government organisations like Step Change will advise you and either give you a template letter or negotiate for you.

CogitoErgoSometimes Sun 08-Feb-15 15:47:04

You need proper advice if your debts are getting beyond what you can afford to pay back. CAB or one of the other free debt advisory services has to be a priority. Good luck

TalkinPeace Sun 08-Feb-15 17:53:40

The standing order trick does not feel like its making any headway for the first 4 or 5 months
but so long as you stop all spending on the card, suddenly at around month 6 the worm turns
hang on in there

but yy to trying stepchange / CAB as well

Ijustworemytrenchcoat Sun 08-Feb-15 21:01:01

Thank you. It's not so much that I can't afford them, but I can't afford anything over the minimum, meaning they don't really alter by more than a few pounds.. If I could overpay, or the interest was froze so that my payments were actually eating into the debt I would feel so much better.

I changed from a DD to a Standing Order mid year 2014. I used the last minimum payment of £110 and fixed it at that. But I just looked at some statements and from September 2014 to January 2015 the total debt has only gone down by £43.

At the moment I just can't see a way out sad. If I carry on as I am I can keep my head above water, but I cannot save any money for our future, or get out of this cycle.

I filled the Step Change plan out online earlier but can't put accurate figures in yet for council tax and gas and electric as I just split from my partner recently and they're not fully sorted yet.

Fairylea Sun 08-Feb-15 21:04:28

Is there any chance you could switch to a 0% interest card? (Sorry to ask the obvious).

Ijustworemytrenchcoat Sun 08-Feb-15 21:15:00

I think my credit is too shot for that unfortunately. Every now and again (every 18-24 months I mean, not all the time) I try but am turned down. It would be ideal. The idea of a DRO scares me because of it hanging round on my credit report for 6 years. I will be late 30s by then, and even if I have a much better job will have no way of moving out of private rented accommodation.

I wonder if I would have better luck if I pick one card and try a balance transfer as I have tried the two biggest debts.

sprayandgo Sun 08-Feb-15 21:34:05

I was in your situation a few years ago. I used a template letter from the Stepchange website to get the interest frozen, although my financial difficulties were related to ill health and some creditors demanded lots of paperwork - doctor's letters and proof of bills etc. But the interest was frozen and they were accepting £1 a month for a period. It's seen as a short-term arrangement though, they wouldn't allow it ongoing for years.

Eventually I ended up going for a bankruptcy, as my debts were higher than allowed for a DRO. I don't regret it at all, I would have spent years trying to pay it off at minimum/slightly above min repayment, and now it's wiped and I've already been discharged with no repayments required at all. My credit rating is shot, but if you go on the frozen interest plan then that tends to wreck your credit anyway tbh. And I haven't needed any credit since I filed because I actually have enough income to live sensibly now I'm not paying a chunk of it towards debts!

I'd give Stepchange a ring once you have all your figures. They can give you an idea of whether it's worth trying some debt management plan, using a fixed payment approach or if it's unrealistic to repay it and if DRO is an option.

Ijustworemytrenchcoat Sun 08-Feb-15 22:23:36

I know what you mean about not needing credit once free of debt sprayandgo I would feel rich if I had the extra £200 in my pocket that currently goes towards repayments. But I yearn to give my son a sense of security, a permanent base as his dad, my ex, owns a home and I just feel like I am letting him down in comparison.

It's knowing it will be paying it for so long and it will never change. If is such a big thing for me to admit it's out of hand, I feel such a deep sense of shame. My mum and dad are old fashioned in that they always used to save up for something then buy it. Then they used credit cards and paid in full each month which is what I used to do.

vinegarandbrownpaper Sun 08-Feb-15 22:29:22

Cab might help but you can write a letter saying that a court would freeze the interest so can they do that anyway and work out a payment plan perhaps?

Rockchick1984 Mon 09-Feb-15 02:17:28

How much do you owe, can you give a breakdown on here with interest rates and minimum payments to see if there's any way to get it paid off quicker?

Ijustworemytrenchcoat Mon 09-Feb-15 07:56:23

It is about £12000 overall. I will have a look for statements. I know one is about £5200 at 24.9% and another similar but those statements are online, I will see if the interest is on the annual summary. The two 'smaller' ones don't bother me so much as they feel so much more manageable. Both under a £1000, one has a small interest rate and a high percentage minimum payment so goes down quite quickly.

I keep thinking if I can get rid of those two I can use those payments on the bigger two.

Rockchick1984 Mon 09-Feb-15 12:17:17

Have u put the details into a debt snowball calculator?

TalkinPeace Mon 09-Feb-15 12:22:08

check the figures and rates on my spreadsheets ....
because if you can get them all across to standing order and pay an extra pound or two a month they will go a LOT sooner than you think.

Ijustworemytrenchcoat Mon 09-Feb-15 20:30:56

What is a debt snowball calculator? Is that where you finish one card and add that regular payment to the next rockchick?

I am on a tablet TalkinPeace and tried your spreadsheet but didn't want to wreck it. The highlighted fields were disappearing so I will try when I can use a computer.

For info:
Card 1 - balance £894, interest 9.510%
Card 2 - balance £868, interest 20.832%
Card 3 - £5238, interest 24.95%
Card 4 - this is the one I can't access at the moment, but I think it is around £4700 and a similar interest rate to card 3.

So I can put the figures in for increased payments and it will tell me how long it will take?

namelessposter Mon 09-Feb-15 20:47:24

Yes. Read the Martin Lewis page "credit card shuffle" and it will tell you who will reduce or freeze rates,an what they will change them to, if you hold your ground. I did this last week. Dropped my rate by 50% for 6 months.

TalkinPeace Mon 09-Feb-15 21:17:04

How much of the balances in the others can you transfer into card 1 and then whack it REALLY hard
eg if you could move all of 3 and part of 4 into and make the same payments you are currently making, your debt free day will be here even sooner.

Ijustworemytrenchcoat Mon 09-Feb-15 22:45:54

I don't think I can move any. I had a limit of £3000 on card 1, but I got a letter way back that they were reevaluating customer interest rates and it would go up unless I closed the account. So I will keep that interest rate until the balance is paid but I cannot use the card for purchases or balance transfers.

avocadotoast Mon 09-Feb-15 22:49:26

You'll be able to get advice from StepChange even if you have estimate figures. Council tax you can find out online anyway (see:, just don't forget to factor in single person discount of 25% if you're the only adult liable in the property.

If you have estimate figures it can be easier to speak to someone so you can explain things. Maybe give SC a ring? smile

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