Tesco Loans

simpless

I'm looking for a bit of advice.

I currently have a tesco loan that i took out a year and a half ago which i make payments to of £243 per month. I have never missed a payment. I have a good salary and an excellent credit rating. My current balance on the loan is just a little over £7500

I contacted tesco loans today regarding topping up my loan to consolidate some credit card debt, i feel it would make for sense to have one monthly payment where the balance reduces rather than make minimum payments to credit cards.
On contacting tesco to top the loan up to £13000 i was advised that i was provisionally approved but the interest rate has increased from 7.9% to 9.7% (i would have thought that as an existing customer i would be given a good rate) they have also requested a full month bank statement!! Unsure as to the reason why?

My concern is that this month spending was a little higher than normal due to a few events (its not a normal occurance) im concerned that showing this months bank statement will have an effect on the application as im not sure what they are looking for.

Has anyone had any similar experiences?

Thanks in advance.

Rafter

simpless,

Personal loan rates have increased and consolidation loans are hard to come by, so I'm not surprised by the higher rate.

Before going for a bigger loan though, you need to work out whether you really want to be paying for whatever you spent on your credit card over the next 3+ years though (on your loan) and whether having a simple monthly payment is worth paying £200 extra in interest for.

If you really want to get your debt down you also need to close the credit cards you are paying off and keep one for emergency use only. Otherwise you could find yourself in even more debt.

As long as you don't have a big unauthorised overdraft, I wouldn't be too worried about sending your bank statement. They are probably just doing a check to confirm that your monthly income is what you have declared on your application and that you haven't significantly mis-stated your other outgoings.

Good luck

R.

simpless

Thanks for your response rafter.

Yeah i have put alot of thought into the loan, working in finance myself i took a bit of time to work out my finances before committing.

I feel it would make more sense to have one monthly payment with an end result rather then making payments to 3 different things and getting no where!
My Plan will be to close the higher rate credit card with my bank and keep a virgin cc for emergencies i.e car repairs etc.

I contacted tesco last night to reduce the term of the loan i had initally reqested 4 and a half years but decided to reduce it to 3 and a half and was advised i do not have to provide the bank statement.

Just really looking to get finances in order and get rid of the credit cards and overdraft.

Thanks