Bank of Dad

hells83bells

I would be really greatful if someone would offer me some advice. I have VERY stupidly got myself into a silly amount of debt after going to Uni and living beyond my means for too long. As embarrassed as I am about this situation I'm trying to deal with it, but to date not getting far. So here goes.....

My dad has kindly offered to get a loan out for me to pay off my debts and I'll pay that back or he will act as a gauntor on a loan which I will take out in my name.

A) do u know any company which allow a gauntor on a loan
b) will we get a cheaper rate if my dad gets it in his name
c) any other suggestions?

I am working two jobs and take home £1900 a month. My debt is £20,000 on a mixture of loans overdrafts and credit cards ( mostly on exspence cc's). At the mo I'm paying the minimum payment on this debt and it's crippling me. I effected my cc rating by making payments late ( my own fault totally). Finally ( sorry for the long post) I have attempted to contact the companies to see if they can help but was basically told that unless I fail to make payments they won't reduce payments or freeze interest. The only other opition suggested was a dmp or iva but a) I think it's a bit extreem given I have a job b) I got myself into this debt therefore I want to pay it back. Thanks for ur help. Regards a confused but determind 20 something graduate.

Savvy_Spender_South

Dads rate will be much better than yours so use his very generous offer and thank your lucky stars you have this opportunity.

Did you not get student loans on daft low rates? your dad will end up paying 8% + on 20 000 which will be costly. (not as much as CCs though)

hells83bells

Thanks for ur reply! Yeah I got a £7,000 student loan which is deducted at source. However this wasn't enough to live for three yrs and stupidly I spent on cc rather than getting more loan. It was my stupidity and thinking I could cope ... And I couldn't. Any ideas which is the best loan at the mo? I have looked and cheapest seems to be at sainsburys and it's 8.7% on £20,000 over five yrs. Thank u for ur help it's really nice to know there are other people out there

Clive_Woody

Rather than getting a loan for the full £20k, you might be better off getting a smaller loan to clear the credit cards then continue to pay the other loans as per normal.

Look at the interest rates on the various debts and pay the highest first. If some of the £20k debt is made up of student loans then these will be at minimal APR so taking out a loan at 8% or more makes no sense.

Worst case scenario, can your dad afford to make the repayments if you lose your job or become unable to work for whatever reason. Something to think about.

hells83bells

Thanks Clive that's a good idea. That £20,000 isn't student loan that is deducted before I get paid £1,750. Yeah my dad has taken that into account about paying if I can't afford it. I've worked out that even if I did get made redundant I could afford my out goings and loan on minimum wage - I'm not too proud to get a shop job or bar or both to pay my way. I certainly wouldn't want to bring my dad down with my debts. Good thought though. Everyone is sooo helpful and friendly on here, thank u!! X