Husband has been declined a Post Office C Card but has good credit?...question...

PrincessJR

Hi,

My husband applied for the Post office credit card, as they are offering 0% on balance transfers at the moment, and we really need to reduce our interest. (Currently can only afford the £65 minimum, but are getting charged £60 interest!)

He received a letter yday saying they could not offer one at this time.
We have checked his credit file, it is all up to date and is Good.

Mine on the other hand is not so good, (fair/poor). I have a good record recently (last 2 years) but my previously history is bad. I also have a DMP at the moment.

Could this be the reason for the refusal? - Financial association?

If so, what can we do? We want to consolidate 2 credit cards in order to reduce the interest, so that we can actually 'chip away' effectivley at the balance.

Ideas?

Moggles_2

Are you financially linked?

If you share a financial product with someone else (eg. joint bank account), then you are linked financially and the poor management of your affairs could certainly have a knock-on effect on their credit rating, but simply being married to someone and/or living at the same address, has no effect whatever.

stephane_2

I don't know what is your financial situation at the moment but if yourself is already on a DMP and that at the moment you can only afford the minimum payment of £65, then it is very unlikely that your husband will get a 0% CC even with a decent credit history, you are financially connected. I am not convinced that taking a CC would be the solution, why don't you contact either payplan/CCCS who will be able to offer you free advise.

nzseries1

It may not be what you want to hear, but if you can barely afford the minimum payment, then the Post Office will know that (based on your income and existing credit), and hence why they won't be prepared to give you any further credit.

PrincessJR

My DMP is through CCCS, I have held it for 2 years.
We have our mortgage, joint bank account, utilities etc so yes we are financially linked.

Obtaining credit seems very hit and miss. For example, with the DMP we were able to get a mortgage etc..... I have opened new bank accounts etc and so find it difficult to understand why my husband cannot obtain a credit card...unless companies are being 'super strict' due to the current financial climate?

We both work full time. I earn £22000, Husband earns £25000.
Our joint salary allows us to cover all expenses, but we do not have a great deal of money left for ourselves, and so paying mroe than £60 on 1 credit card (when we already pay £50 on the other and £120 to my DMP) would be difficult at the moment.

We considered a consolidation loan but Im wary, as it seems to not be dealing with the credit, but adding to it??

stephane_2

If between the 2 of you you are earning around £47,000 a year and are already unable to pay more that the minimum payment then i would say that you are already stretching yourself financially and getting a 0% is only a short term solution. A consolidation loan is not always a bad idea but you would have to make sure that you don't commit yourself to other credits and this is usually the mistake that most people are doing

PrincessJR

You're right we are pretty stretched. Saying that, we do go out maybe every other week, cinema etc... so could cut back there. We spend roughly £200 per month on food/drink shopping and for 2 of us.... this could also be looked at.

We have decided to look into a consolidation loan, but are worried about being refused again thus knocking husbands credit rating even more.

If we borrowed £10k it would take care of the majority of our debts (4 lenders paying out £300 per month).

We could therefore afford to pay £300 per month in payments. Is this a realistic amount or would repayments be more than this on £10k? Bearing in mind, my husbands (good credit) financial connection to me (poor credit)?

LilacPixie

Companies are tending to be super strict. I could not get another 0% deal despite a spotless credit history but have had 4 credit checks in the last year so I have had to use savings to clear the card.

Debt consolodation is rarley if ever a good idea. Iwould seriously consider either upping your income, reducing your outgoings or both and try and clear the card and other debts as quick as possible. Consolodation will probably cost more over the long term.

PrincessJR

thanks for the advice.

obviously upping our income would be great, but at the moment, it doesn't seem realistic. Consolidating our debts WOULD lower our outgoings, but I know what you're saying. Ideally if we could, I would prefer NOT to get new credit, but the interest on the credit cards means that when we pay £65, we get charged £60 interest...so frustrating!

I have just read about Ocean Finance. They could offer a secured loan of £10k at £230 per month repayment. That would be considerably less than we currently pay out, and is over 5 years. Also, they allow you to repay whenever you want, and you only pay 1 months interest as an early repayment charge.

I dont like the idea of it being secured on our home, but we do have Income protection insurance so if we were out of work, this would cover the repayments.

Cant decided if it would just be a short term answer though?

Inactive

Don't take this the wrong way, if you cannot manage on a joint income of £47.000 you need to take a full look at your expenditure and reduce it.

Taking on more debt is not the answer.

beverleyhills

Money is an expensive commodity.

A consolidation loan means you pay interest on interest.