Loan Advice

Lee3183

Hi. I am after some advise about re-structuring by debts.

In October last year i took out an unsecured consolidating loan with Lloyds TSB of £25,000. This was under their advice, and my nievity is showing now as i am paying back £566 per month, a huge slice of which is payment protection. At the rate i am going i will end up paying back nearly £48,000 when the loan is finished!

I have been reading these forum's regularly and have now realised that i could be paying alot less than this with other lenders.

I have spoken to Lloyds who have provided me with an early settlement fee of £24,900.

My plan is to get an unsecured £25,000 loan from another lender at a cheaper rate, and pay off the Lloyds loan. I will then pay off the new loan but at a cheaper rate, saving me alot of money each month, compared to what i am paying now.

I have checked my credit rating which came up fair. I have never been rejected for credit.

My concerns before i apply for the new loan are:

1. Does the Lloyds TSB settlement inlcude the PPI

2. Am i likely to be accepted for a new loan, as i dont want to apply on-line and be rejected as it will damage my credit rating.

Does anyone have any advice or been down the same road? Am i doing the right thing?

Any help is greatly appreciated.

Thanks

CLAPTON

Is the early settlement figure in writing..
Although I would expect it to include PPI what does the paperwork say?

A credit search won't affect your credit rating unless you have recently had a lot of searches already.

Whether you will get a new loan depends upon things like your salary, residential status etc.

whether its sensible depend upon the details of the exisiting loan and PPI and the details of the proposed new loan but if on a like for like basis the new loan is cheaper then it seems sensible.

Lee3183

Yes the early settlement fee is in writing. I will double check it when i get home.

The new loan would potentially save me approximately £160 per month.

My main concern is applying on line and being rejected.

Thanks for your help Clacton, it is much appreciated.

CLAPTON

without any knowledge of the details, but you could try asking Lloyds how much you would save if the PPI were removed.... sometime they will just remove it and reduce payments but sometimes they insist on providing a 'new' loan which magically has a higher APR so you need to be careful.

Also be aware that when you apply for a anew loan of 25k, the potential lender will see that you already have 24k and so see your total debt commitment as 49k... so unless you salary is substantial they may refuse you on affordability grounds.

Lee3183

Thanks Clacton. You have helped alot.