Refused consolodation loan - help please

InsomniaEndsHere

X x x x x x x x x x

Fonz_2

How much do you earn and how much is your total debt?

drbesty

I think it may have something to do with having 7 loans

angel_islington

The cynic in me says one of the reasons you were turned down is because your loans are high interest rates, so they are making a lot of money from you. It is less beneficial to them to put you on one loan with a lower rate. Remember they work for their benefit not for yours.

I got turned down for one of these recently as well, with similar outstanding amounts. I plan to call a local credit union tomorrow to see if they can offer me some advice, perhaps you might want to look at doing the same?

ILW

InsomniaEndsHere wrote: »

I think so also but I am trying to consolodate to get that!
Total debt is around 9k outstanding on the loans

I earn 30k salary per year

They probably think that with 7 loans you are some sort of credit junky, and if they give you the loan you will also run up a load more credit in addition.

CHR15

They have no idea that this one loan will leave you with a single loan to repay.

They will assume if you borrow this money, you will have 8 Loans with a total of £18k worth of debt.

Try to speak to your own bank, they may have a mechanism to repay your existing loans off direct, without you getting your mitts on it first.

RobertoMoir

I think saving up, paying stuff off and trying again is a good idea. Or even better still just keep saving and paying off as it is. There's good tips to make it happen quicker than you think over on the debt free wannabe board such as snowballing payments, etc.

First big problem with consolidation loans is the absurd idea that "more credit" is the answer to credit problems. There's a reason why the fire brigade don't try and put out burning cars with petrol...

Second big problem with consolidation loans is that there's no way for them to know you will actually use it for consolidation. Therefore the lender doesn't consider that you have 9k of total debt to various companies now and will have 9k of total debt to them after the loan is granted, they see someone earning 30k with a potential debt of 18k... and zero chance of getting their money back if that person crashes and burns.

CHR15

InsomniaEndsHere wrote: »

save up whatever I can in 6 months and pay off 2-3 of the loans and my credit card and then try again?
Then instead of 9k outstanding credit spread accross 7 loans and 1 cc there would be a cc with no debt and 4-5 loans with around 5-6k total debt?

If you can manage to repay £4-5K in only 6 Months, what on earth do you want to consolidate for??

You can be debt free in less than a year, as you repay each one, you are left with even more disposable to feed the rest.