Secured Loan... the only answer?

misssunny

Hi, Ive got a few credit card debts I want to consolidate/pay off (currently paying interest only: on 3 cards totaling £14K, or £300pcm in interest only repayments) and Im already paying off a £14K loan at £300pcm. My income is ok so Im coping, and Ive got a fairly low mortgage on my property (£155K, but the value is £310K so my mortgage isnt too high) but I want to reduce the interest on the credit cards and start dealing with paying off more of it overall.
I was recently refused a Barclaycard (which I wanted to get for consolidation) even tho my credit rating is ok (?) according to Experian, So I rang the Debt Advisory Line this morning, who told me that my best solution was to get a Secured Loan, or a remortgage with one of thier recommended companies. (I still have 6 months left on my 2 yr fixed mortgage) but after looking on the forums here, Im increasingly worried that this may not be the solution: I thought the advice I was getting would be impartial, but it looks like Secured loans are a last resort option: Are there other options open to me? Ive never defaulted on payments and as I said my credit rating is good, but I was worried my credit rating would be affected by applying for lots of new 0% transfer cards so thats why I rang the Debt Advice Line. They are calling me back to discuss this further, but I would like to know if there are better options out there: would applying for a consolidation loan with the bank that has my mortgage be a better idea? please help!
Im very confused...

bank_of_slate

Hi and welcome, a secured loan is rarely a good idea!
can you post a full Statement of Accounts by using this link https://www.makesenseofcards.com/soacalc.html

It'll help us to support and advise you.
Include EVERYTHING and then also contact one of the debt charities CCCS or Payplan for some advice!
...Linda xx

misssunny

Hi, Thanks for the quick response! I'll post a statement of my accounts asap... the new year is coming and I want a new approach to tackle my debt! thanks for your help.

bank_of_slate

No problem sunny, keep posting and feel free to join the daily chat thread to get to know some of the regulars on here!
...Linda xx

bank_of_slate

I'm amazed that they suggested a secured loan!
Is this a fee charging service that you contacted? If not I bet they are payed a commission for recommending certain products!
Speak to CCCS or Payplan!!!!
...Linda xx

GeorgeUK

It does sound like an IVA company that you contacted or an agent.

If you want free impartial advice, you should try citizens advice, nationaldebtline, Payplan or CCCS. They do not charge for their services and will definately not suggest turning unsecured debt into secured debt.

You can have about 3 credit searches in a 6 month period before your credit score is affected, so it may be that you have applied to too many places in a short space of time.

dancingfairy

A secured loan is not usually suitable for most people. The downfalls are :
1) you end up paying a lot more over a longer period of time - lots of nice interest for the loan provider.
2) if you can't pay you could lose you house - whereas with credit cards etc they are not able to take your house as far as I know.
3) the other problem is that people often relax thinking it is all wrapped up in a consolidation loan but if you don't tackle the underlying causes you will be back where you started with a lot more debt and a lot less leeway to get tings sorted. It does sound like you have done this before with the loan so you probably need to think about why and where you are overspening.

I am sure there are other options for you to explore first. The best thing is to do an SOA and post it up here so people can get a good idea of your situation and give you some ideas.

I am not sure if the debt advisory service is impartial or not to be honest - it may be that they have a similar name to a free/ impartial organisation or that they perhaps just didn't give the best advice for whatever reason. However I would be wary and DONT sign up to anything without seeing what people on here think about there suggestions.

Best of Luck
df