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Another debt consolidation question - Didnt get advertised rate
Hi All,
Whilst I agree with the principle that debt consolidation loans generally aren't a good thing, i'm leaning towards one due to my current financial position. I've just come out the other end of a rough divorce. I had no idea how far things would go, but a bitter ex combined with a couple of eager solicitors didn't favour me too well. The result was £20k across three credit cards and a parental loan. I've managed to pay off the loan and one of the credit cards leaving me with £14k across the other two cards. Now that my divorce is final a big chunk of my monthly income will be going on child maintenance, so things are going to a bit of a stretch to say the least.
Justification over, shifting the £14k to an unsecured loan would reduce my monthly payments from £400 to £280. As well as a saving of £120/m I know it would be paid off in 5yrs, way quicker than with my current minimum monthly credit card payments. This is on the assumption of getting an advertised 7.9% rate. So I applied for a Tesco loan, and was happy to receive an email acceptance. However the letter I received a couple of days later offered me a "personalised rate of 13.4%" (due to the results of a credit scoring risk assessment), adding £2k to the total repayment figure. I've got a clean credit history (confirmed with equifax). Gross income is £35k, and only the two credit cards (£400/m) and maintenance (£600/m) over my living expenses.
Advice needed. I dont want to un-necessarily apply for a string of loans, but 13.4% sounds a little high, do you think I could do better? I've always got top rates and never been refused credit, but I was married then and owned a house with equity. Now I'm divorced and rent. Is getting close to 7.9% viable? Are interest free credit cards an option for £14k? Any other options worth looking into would be welcome.
Many thanks,
Lee.
Whilst I agree with the principle that debt consolidation loans generally aren't a good thing, i'm leaning towards one due to my current financial position. I've just come out the other end of a rough divorce. I had no idea how far things would go, but a bitter ex combined with a couple of eager solicitors didn't favour me too well. The result was £20k across three credit cards and a parental loan. I've managed to pay off the loan and one of the credit cards leaving me with £14k across the other two cards. Now that my divorce is final a big chunk of my monthly income will be going on child maintenance, so things are going to a bit of a stretch to say the least.
Justification over, shifting the £14k to an unsecured loan would reduce my monthly payments from £400 to £280. As well as a saving of £120/m I know it would be paid off in 5yrs, way quicker than with my current minimum monthly credit card payments. This is on the assumption of getting an advertised 7.9% rate. So I applied for a Tesco loan, and was happy to receive an email acceptance. However the letter I received a couple of days later offered me a "personalised rate of 13.4%" (due to the results of a credit scoring risk assessment), adding £2k to the total repayment figure. I've got a clean credit history (confirmed with equifax). Gross income is £35k, and only the two credit cards (£400/m) and maintenance (£600/m) over my living expenses.
Advice needed. I dont want to un-necessarily apply for a string of loans, but 13.4% sounds a little high, do you think I could do better? I've always got top rates and never been refused credit, but I was married then and owned a house with equity. Now I'm divorced and rent. Is getting close to 7.9% viable? Are interest free credit cards an option for £14k? Any other options worth looking into would be welcome.
Many thanks,
Lee.
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