personal loan or stick with overdraft

jopenred

I HAVE A OVERDRAFT WITH NATWEST FOR £6,000 NEVER GOES DOWN,I HAVE JUST RECIVED A RISE FROM WORK,SHOULD I GET LOAN FROM BANK,IF POSS!! OR JUST LET IT RIDE AND SEE IF I CAN REDUCE IT, I WILL NEVER BE ABLE TO PAY IT ALL BACK FOR YEARS.

CLAPTON

please don't write in capitals

what is the APR of the OD
what is the APR of a likely loan.

In any event you need to look at your spending patterns and to determine why you are overpsending. Simply swapping the debt around wouldn't in itself change your spending habits.
Do you have a budget?

jopenred

sorry,
I have done a budget,i now have a extra £100.00 pm after a rise,the APR of the OD is 18.49% + £12.95 for advantage gold account,loan 12.4%.
Thanks

CLAPTON

the problem with getting a loan to 'pay off' a OD, is that often people then simply run the OD up again so fairly soon you end up with a loan and a OD.

also, presumably your OD is with your main current a/c so it fluctuates each month when your salary goes in and as the interest is worked out on a daily basis this will save a bit.

I would suggest you look closely at your spending and see whether you can free up a bit more money to reduce the OD.
Stick to this for a few months and then see whether you can get a lower apr loan.

Kavanne

if they OP takes a loan through Natwest to clear a Natwest OD, the bank will automatically reduce his OD to £100 once he's had the loan money deposited into his account.

12.4% is the typical APR through natwest so he won't get lower than that if he sticks with natwest, but could get lower elsewhere of course.

But natwest will offer a loan to clear an OD the majority of the time, but it might be at a higher APR than typical. But at least gives OP an option if they have bad credit/can't get a lower APR elsewhere.

jopenred

Thanks for that i can see were you are coming from.I will try to reduce OD as much as poss in the next few months and then look at it again.

jopenred

Did not know that natwest would reduce OD,but mybe thats not a bad thing,could go elsewhere but at least natwest get wages get paid into account so more chance of getting a loan.

Kavanne

jopenred wrote: »

Thanks for that i can see were you are coming from.I will try to reduce OD as much as poss in the next few months and then look at it again.

No offence but will you?

Or will you think 'ooh, an extra £100? I could go out for a slap up meal or get a new computer!... oh or I could reduce by Overdraft... boring'