To Consolidate or Not to Consolidate? SOA added...

pnq06

Just reading through the rest of the posts but thought I'd add that the OD interest is 19.3%

pnq06

Oh and the bank wanted to review our OD and have asked for it back so I kind of feel forced into excepting it cos I know we cannot get a loan anywhere else..

davetrousers

pnq06 wrote: »

Oh and the bank wanted to review our OD and have asked for it back so I kind of feel forced into excepting it cos I know we cannot get a loan anywhere else..

Accepting.

Sounds like they are trying to pressure you into it.

As others have suggested you might want to post a Statement of Affairs so people can suggest ways of cutting back.

JimmyTheWig

You really do need to get this overdraft paid off.
I don't know what the deal is with the bank asking for the overdraft back.

There probably are places you could cut back on your spending. Can you account for every penny spent? Can you be sure that it was necessary? Can you be sure that you couldn't have got it elsewhere for cheaper?
Maybe every penny is pushing it, slightly, but in this situation I would say that every pound helps.

And is there nothing you can do to bring in some money?
Car boot sale, maybe?
Evening / weekend job?
Longer hours in existing job?
Take in a lodger?
How about a "self-employed" job like gardening, cleaning or ironing?

rayday2

You could go to a debt charity, open a new bank account then pay both the loan and overdraft back at a rate you can afford to live on.

Verbatim

As rayday says open a new perhaps basic bank account and get you salary paid in there. Then treat your existing account overdraft as another debt that has to be paid pro rata along with all the rest.

Don't sign up to the loan. as others have said it'll cost you more each month and a whole lot more in interest over the term of the loan.

Post up a detailed list of your income and outgoings so that the good peeps here can help you make some savings. You'll feel a whole lot better as soon as you feel in control of your finances.

SouthernSoftie

I really hope that Lloyds weren't trying to sound like they are doing YOU a favour as it only seems to be of benefit to them.
That is a shocking rate for a loan.
Don't do it hun.

RAS

Hiya

i just treid mucking about twith the snowball and if under you current arrangments you pay off 3% of the OD every month, it will take you for ever to pay off the OD but you will pay a total of £5579 interest over that time.

If you take the new offer, then you will pay it off in 7.5 years but it will cost you £12,287 in interest, in otehr word nearly £7,500 more than you have to pay out under the current arrangments.

Please speak to a debt charity as a matter of urgency and put up you SOA here as it may be possible to find ways of cutting you OD and starting to make inroads into the amount of interest you are paying.

Everything people here know about consolidation indicates that is a really poor idea.

tyllwyd

Does the loan have to be for the full £14K? Would the figures work if you just borrowed the £3K to cover the overdraft and left the existing loan as it is? It still wouldn't be a good deal, but it would be a lot better than borrowing the whole amount at 18%

kittynortheast

As others have said the general consensus is NOOOOOO!, My last consolidation was two years ago, We always thought we'll not overspend this time, stick to a budget etc... but that feeling of sorting yourself into a neat little payment plan always ended with another three or so thou at the end of the year - a continuing cycle. Although still skint and overspending somewhat we haven't brewed our usual debt to consolidate since my LBM last year. If there is any other way to do it then do it put your SOA on here and I'm sure the good folk wth more expertise than me will guide you through. Good Luck.