Been a plonker..

chris1210

.. over the past few years!

I became a bit obsessed with getting new cars, its an early 20's thing, and its ended up with me changing cars 4 times in 4yrs. Each time, ive never took into consideration just how much they would lose in value, and because Natwest always said yes to upping my loan, i always did it.

So, the top and bottom of it is, that at 25, i have a loan with Natwest for £24k over 5yrs (god i cringe just typing that). With interest and PPI on, i think the total pay off is something like £34k (£577 a month over 60). Its shocking, i know ive been a dipstick, but thankfully i earn over £1400 a month, so it isnt a HUGE problem, its not like i struggle to pay it - but, as with everyone, i kinda want my own place around about now (so yes, as well as being a huge loan, its unsecured too).

Theres probably absolutely nothing that can be done about it, and i do understand there are thousands out there in much worse trouble than i am.... but would there be any sorta quick fix to cut the interest/payments down etc? Could it even be feasible to whack that loan value onto a mortgate? (something ive been told about, but dont 100% believe).

On top of the loan, savings are non-existent, but only one CC with £300 on it thankfully.

Always been a good payer, never missed anything, but, and could be crucial, i dont think my credit rating is brilliant, okay but not brilliant (probably cos ive yet to pay this loan off properly, keep renegotiating!).

Sorry for the long first post

callyhall1978

Hi Chris, do you have an advantage gold account, if you have, I think it knocks about 2% off your loan, doesn't sound like a lot but every little helps!!!!

nej

Might be worth a read-through of the "Cancelling PPI Can Be Done" thread. If you can cancel the PPI on the Natwest loan it might make a difference.

underpressure_3

sounds like your in the same boat as me mate

as400

Talk to an IFA with regards getting a mortgage/property, some deals are not as bad as you think, look at the APR you are paying now on your car loans, do some math, if you have good credit you should be cool for a mortgage. Get hold of your THREE CRA credit reports.

underpressure_3

as400 wrote:

Talk to an IFA with regards getting a mortgage/property, some deals are not as bad as you think, look at the APR you are paying now on your car loans, do some math, if you have good credit you should be cool for a mortgage. Get hold of your THREE CRA credit reports.

Sorry to jump in on this thread but Is it possible to get a mortgage when in debt? i was of the understanding you had to be debt free to get one. I am in the same sort of situation owe 18k and take home about 1400 a month. i have also never defualted on any payments so have a good credit history.

cheers up

E@J'S_DAD

I have just moved a secured loan and added it on to my current mortgage,this has doubled the size of my mortgage and therefore increased my payments .This was a good thing for me as the other debt was secured on the house anyway.total fees £179.Obviously you need to get that mortgage first.40,000 extra borrowed costing an extra £302 a month over 15 years.Saves me £100 a month on a fixed 5 year mortgage.6000 over 5 years.

s-j-cooper_2

I got offered a mortgage whilst in debt - I think they just subtract the amount you owe from the total they would offer you if you had no debt.

thedonz

You can obtain a mortgage while in debt because if you couldn't 80% of the population wouldn't be able to get a house.

They will however take your loan into account and reduce the amount you can borrow accordingly i.e. With a typical mortgage multiplier of 4 times your salary/year if you earned £25k/year with no debt you would get £100k for a mortgage, but if you pay £400 a month on a loan you multiply this by 12 months (£4800) and remove this from your salary (£25k - £4.8k = £20.2K). You would then use the multiplier to work out your max borrow. i.e. in this case £20.2k x 4 = £80.800.

Northern rock do a 'Together' mortgage where they will lend you 25% on top of your mortgage as a secured loan (in effect a 125% mortgage) see there site for details as it might be a good option because on £100k it would cost you about £600/month. It might be for you, it might not but it helped me out.

Hope this is some help.

Bernard_Coleslaw

Hi Chris

As others have said - go see an advisor (preferably independent) and see what they can recommend - you may be pleasantly surprised. Be careful about jumping after individual lenders recommended by well-meaning posters. Not everyone is the same, and what works for some may not work for all.

And, hey, keep your current car for more than 12 months this time!

Cheers

BC

Deemy

Your goal should be to become debt free in the shortest possible time, look into what effect overpayments will have, if none then put the money into a savings account so that they offset the amount outstanding on your loan.

Make it your number one priority ! To be debt free !