Loans

[cpjitservices]

Hi all

 

Would like some advice, I could do with a loan.

 

I applied at Natwest for 9,950. Because of an old credit card that im paying back at a pound a month Its left me with bad credit. I have a couple of credit cards too which I am up to date with. Only a couple of hundred pounds on each.

 

At the moment all balances are 0 on cards except one. Which I was going to clear with a loan. I also need anew fridge freezer and some car repairs. Also maybe, put some away for house deposit.

 

Anyone any ideas of where I could go ?

[unixman_again]

Zopa | Peer-to-Peer Lending & Loans | Invest Money in P2P - lowish interest rate and you'll be borrowing money from small investors like me. I had my car loan through them and now I'm leanding to others.

[SteveBentley]

Borrowing money to put away for a house deposit sounds like a strange way of doing things - especially as you'll be paying more interest on it as a loan than you would earn on it as savings.

[pcstru]

I applied at Natwest for 9,950. Because of an old credit card that im paying back at a pound a month Its left me with bad credit. I have a couple of credit cards too which I am up to date with. Only a couple of hundred pounds on each.

So that is one card that you are paying off at a pound a week and two more with a couple of hundred each on them?

At the moment all balances are 0 on cards except one.

I'm confused. That's not what you seemed to say above, which led me to believe you have three cards.

Which I was going to clear with a loan. I also need anew fridge freezer and some car repairs. Also maybe, put some away for house deposit.

IMO it is pointless (or worse) to borrow for a house deposit. Calculate what you would spend in servicing that portion of a loan and divert that amount into savings.

Anyone any ideas of where I could go ?

 

So Natwest turned you down because of bad credit? There are probably still many to choose from. You will end up paying a high rate of interest so you should consider other options (they might want more than you are already paying on the cards in which case what would be the point) if possible.

 

ETA - worth looking to see if you have a local Credit Union.

Edited August 4, 2015 by pcstru

[cpjitservices]

I have the one card that I had years ago which I defaulted on, I had a job when I applied for the card then didnt get paid any wages for 6 months... so defaulted on the card and havent had the money to pay it all back off yet.

 

Yes was going to get a loan pay off debts etc, pay off my Capital One card which I owe about 300 quid on which I pay £1 a month sort car out etc. I have a barclays credit card which I Owe nothing on as does the wife.

 

I was going to put the rest into savings for a house deposit... have no other way of raising at least 10k.

[pcstru]

I was going to put the rest into savings for a house deposit...

 

If you are having to borrow for that deposit out of a high interest loan, you really need to think whether it is worth it. Any mortgage application will want details of any loans you have. The loan will cost you more than borrowing on a mortgage and will be detrimental to the amount you can borrow because servicing the loan will impact your outgoings.

 

have no other way of raising at least 10k.

I guess you mean no way of raising it right now because if you borrow 10K the lender needs to know you have a way to raise that over the term of the loan (so over that time you could certainly raise more by saving). If you don't actually need that right now, then you might be better minimising your borrowing and working on improving your credit rating, that way when you do need the deposit and the only way would be a loan, you might have access to better terms. You will probably find that if your credit rating is causing you problems with a loan, it will also cause you problems with a mortgage.

[localzuk]

I was/sorta still am in a similar position. Old credit card I defaulted on etc... I have spent the last 9 years paying it off. As much as I'd loved to have skipped ahead and have money for a deposit, it didn't and still doesn't make any sense. My best course of action (and my advice to you) is to pay off the existing debts, and only once that is done is it sensible to look at new credit. I have paid off nearly £25k in 9 years, on a credit card and a consolidation loan. My credit card is now clear and my loan has a couple more years left at a fixed payment rate each month. My credit rating has gone from single digits to being 997 now, and I now have a credit card again - for those emergency payments.

 

Sure, it has been tough going (especially at first, when my salary was much lower), with lots of sacrifices made, but I think overall it has put me in a much more stable position overall.

[penfold_99]

If you have a couple of credit cards with either not much or nothing on them then consolidate the debt by doing balance transfers, there are some good deal about.

Also close any unused credit cards it not always about how much you owe but how much available credit you already have.

 

Banks look at your total credit and if a new application for a loan takes you over their acceptable total limit you will be declined. I had this years ago when getting finance on a car, the previous finance company took ages to mark the previous loan as paid in full

so with that value plus a new car value it look like a owed tens of thousands when in fact i didn't.

[mthomas08]

Hi all

 

Would like some advice, I could do with a loan.

 

I applied at Natwest for 9,950. Because of an old credit card that im paying back at a pound a month Its left me with bad credit. I have a couple of credit cards too which I am up to date with. Only a couple of hundred pounds on each.

 

At the moment all balances are 0 on cards except one. Which I was going to clear with a loan. I also need anew fridge freezer and some car repairs. Also maybe, put some away for house deposit.

 

Anyone any ideas of where I could go ?

 

Having been in a similar situation, my advice - do not get another loan, new car, mortgage - ANYTHING that requires more monthly payments.

 

What to do ? Pay off your credit cards, dont go out, dont eat out, cut down on everything and pay off all your credit cards.

[michael2k6]

Your credit score will include total available credit (so say your credit cards are at 0 balance because you pay them off in full each month, but one has a 4k limit and the other a 10k limit, you have 14k available). SO that will affect a decision. If the bank lends you 9k of credit today, there's nothing to stop you using your other 14k of credit tomorrow, at which point you can't afford to repay it all.

So reduce the available credit you have.

It will also include credit accounts as a total. So for example, you have 3 cards there. If you also have a phone contract that's 1. If you have o2 refresh, that's 2. So that could be 5. If you have an overdraft (using it or otherwise) that's 6. If you pay car insurance monthly that's 7. Etc.

Try to have as few as possible.

 

If you've done the Natwest smart loan and they've said you're unlikely to get accepted, it doesn't affect you. But if you've been turned down for an application, the very fact you've been turned down may affect the rest of your credit for the next 6 months and reduce the likeliness of being accepted elsewhere (at least at a different rate).

 

Best advice here so far, if it's possible is from mthomas. If you need a new fridge freezer, get a second hand one for a bit to put you on, and if you need car repairs, consider changing it, if that's feasible in it's current condition.

you could also get online with experian or equifax to check out your credit score and see what's affecting it. You'll have to sign up but if you cancel before a month you won't be charged. Having been in a similar situation, i remain signed up and pay the £8 per month so I can just keep track of what's going on and ensure i'm not missing anything.

 

Oh and ensure you're on electoral role.

[cpjitservices]

I was/sorta still am in a similar position. Old credit card I defaulted on etc... I have spent the last 9 years paying it off. As much as I'd loved to have skipped ahead and have money for a deposit, it didn't and still doesn't make any sense. My best course of action (and my advice to you) is to pay off the existing debts, and only once that is done is it sensible to look at new credit. I have paid off nearly £25k in 9 years, on a credit card and a consolidation loan. My credit card is now clear and my loan has a couple more years left at a fixed payment rate each month. My credit rating has gone from single digits to being 997 now, and I now have a credit card again - for those emergency payments.

 

Sure, it has been tough going (especially at first, when my salary was much lower), with lots of sacrifices made, but I think overall it has put me in a much more stable position overall.

 

Tried to get a consolidation loan, have been knocked back. Twice.

[Miscbrah]

What's wrong with the car specifically? What make/model? I might have asked that in another thread btw, I sometimes do...

 

Also, that government-backed first-time-buyer deposit ISA jobby going to be any good? YMMV on that one though, from numerous directions.

[featured_spectre]

Tried to get a consolidation loan, have been knocked back. Twice.

 

You do know that for every failed application you get a dent in your credit score. As a result, your score will go down and you're going to be seen as a higher risk. As such I'd ring up your credit card company and ask for a settlement figure, or ask to pay off more per month, whichever is better for you in the short term. This means you'll have to pay out more per month, and make a few sacrifices, but this will suit you better. When you've paid it all off, put the money into an ISA. I have done this, and I am currently at £12k in an ISA over 5 years. This is being used for a deposit for a 2nd house when the time comes (ideally my next door neighbours house, and knock the 2 into 1 house).