Divorce & Consolidation

Munky1080

Good evening!

I'm new here so be gentle please

Basically my story is this:

My wife of 4 years and I are getting divorced. I will be assuming the debt of our personal loan (£5100) and her credit card (~£2000.) Unfortunately, the interest rates on these debts are an atrocious 19.9% & 21%, respectively, and with all of the fees associated with my having to move into my own place, I cannot afford to pay the required £400 / month.

I'm looking to consolidate (yes, I know I'll end up paying more int he long term,) and perhaps get a bit of extra money to help me get settled into a new place (i.e. security deposit, a few basic bits of furniture, etc.) I estimate the total amount I want to borrow to be £8000.

Last night I got turned down by Nationwide for a loan, and today I got turned down by Halifax. My income at the moment is £22,700 base, but after overtime is closer to £25,000. Also, after Christmas, I will be getting a £3000 / year raise. I've used the budget planner to account for all of my outgoings (with very liberal estimations,) and all of my income, based on the £22700 I am currently earning, and if I can find a way to consolidate these two debts, into a longer laying loan (say 7-8 years.) then I will be about £200 better off each month.

Another issue I have, is that I am American, yet I do have "Indefinate Leave to Remain" in the U.K. Also, I have been 100% residing in the UK since 01/09/2004. I cannot be put on the Electoral Register however, which has an adverse effect on my credit rating.

My questions are - Do people offer loans with longer repayment schedules than 5 years? Will lenders take into account the fact that I'm not eligible to be on the Electoral Register? What is my best course of action, in regards to finding a lender?

Any advise I can get from y'all would be great. I may be a first time poster, but I've learned a lot from this board by my lurking for a couple of years.

Cheers;

countrygirl84

Hi.
1) You will find that most big lenders do not lend for more than 5 years unless it's a larger amount (£15k or more) or it's for home improvements;

2) Not being on the electoral role will really reduce your credit rating therefore your chances of getting a loan;

3) I would advise you not to try too many times as this also reduces your credit rating.

I used to work for a large high street bank so processed loans day in day out. Are you paying a mortgage at the minute? And also take into account that the way things are at the minute banks are declining people that a year ago they probably would have accepted.

countrygirl84

Not too sure on the whole citizenship thing but I know I processed loans for people before and we could borrow them money so long as the loan expired 3 months before their visa ran out. But yours is indefinite so not sure how that works.

Munky1080

Thanks for the reply. I forgot to add that I do not have a mortgage, so this would be an unsecured loan. I am going to try to see someone at Lloyds TSB tomorrow, as that is where I have my bank account, and also my original loan is from them as well. Hopefully if they treat me like a person, and not a number someone will listen; after all there is money to be made from me in this scenerio.

Cheers;

countrygirl84

How did you get on?

Munky1080

Actually - I got on really well. I was really worried about it. My interest rate isn't that great (15.9%) but I knew it wouldn't be...Got £8500 over 7 years...I got suckered into PPI which really adds up!

The main thing is that my wife and I now have seperate finances and the payments are about £227 a month which won't kill me.

My next step is to cancel my PPI because it adds about £6-7000 to the total amount to be repaid. I figure I'll keep the PPI for about 6 months or so while I get this divorce stuff squared away.

To be honest, the loan adviser at the bank thought I was nuts taking on my wife's debt! But I figured that I can survive with it, wheras if she kept it, it would jepordize her living arrangements, and I can't have that happen to her as long as she has custody of my little girl.

Cheers;

beka-bee

To be honest, the loan adviser at the bank thought I was nuts taking on my wife's debt! But I figured that I can survive with it, wheras if she kept it, it would jepordize her living arrangements, and I can't have that happen to her as long as she has custody of my little girl.


I take my hat off to you for doing this and alot of guys in the world with kids could learn alot from you! x

tictax

No!!!! Don't take the PPI and then cancel. You will end up still paying for it as you will need to settle the loan to take out a new one.

Whatever they tell you they can't force you to take out the PPI if you haven't already signed the loan documents then don't.