At my wits end with Loan companies

Kirstyc_2

Hi, I'm hoping somone can offer me advice on here, I've been just about everywhere else and had all kinds of conflicting advice and service so I'm really starting to wonder what on earth is going on here.

To cut a very long story short, a while ago (2 years or so) I wanted to buy a car. I approached my bank for a loan ( I am a Halifax ultimate reward account customer and have a good track record with halifax) but was turned down.

I was then advised by the bank that although I couldnt have a loan with them for £1500 I was PRE APPROVED for an overdraft of £2500 which I could have that day and which apparently offered lower interest than the loan anyway. Seemed like a no brainer, I upped my overdraft limit and brought my car.

Since then with one thing and another the overdraft hasn't really been paid off (although I usually keep within its limit) and Halifax changed their overdraft charges to about £2 per day. On top of this I'm paying my monthly account management fee of £12.50 and even when I went over my limit by 1 penny they charged me £5 a day for several days.

I now really want to pay off this overdraft, so, I checked my credit rating online (good, 812 points with no record of late or missed payments on my three credit accounts which are a catalouge, a small payday advance company Ive used once or twice when ive been in a pinch and Halifax themselves) however they turned down my loan application for an amount to pay off my overdraft.

The only thing bad on my credit file is im not on the electoral role as i moved recently, and yet due to the fact that I a) dont really have a long credit history because Ive never had loands or credit cards and b) Have had to move house quite a few times for work I cant get credit anywhere except with wonga.com and catalouges.

This overdraft is costing a fortune and I want to get it settled. It makes no sense to me that Halifax will happily pre approve me for thousands of pounds worth of overdraft but not for a loan. I'm really confused as to what to do, can anyone tell me how to get a loan if you arent on the elctoral role and dont have a bad credit rating but also dont have alot of a credit history?

Im stuck.

Thanks in advance for any help.

[Deleted User]

not on the electoral role = NO loan,sorry
get on the ER asap
meanwhile join a credit union save with them for a few months and they may give you a loan at a reasonable interest rate,or possible a cc with a sbt with 0% for a few months?

Kirstyc_2

woodbine wrote: »

not on the electoral role = NO loan,sorry
get on the ER asap
meanwhile join a credit union save with them for a few months and they may give you a loan at a reasonable interest rate,or possible a cc with a sbt with 0% for a few months?

Thanks, I'm not sure what a Credit union is though.

[Deleted User]

http://www.abcul.org/home

opinions4u

I was PRE APPROVED for an overdraft of £2500 which I could have that day and which apparently offered lower interest than the loan anyway. Seemed like a no brainer, I upped my overdraft limit and brought my car.

Since then with one thing and another the overdraft hasn't really been paid off (although I usually keep within its limit) and Halifax changed their overdraft charges to about £2 per day

If your overdraft is less than £2,500 you should only be paying £1 a day. This is cheaper than most personal loan rates.

So how much do you really owe?

And why do you think a loan will make you better off?

I usually keep within its limit

Usually's not good enough. You're abusing your account and as a result they don't want to lend you any more. Sooner or later they will call in the overdraft.

a small payday advance company Ive used once or twice when ive been in a pinch

Go on, tell the truth. How many credit searches for payday loan companies have you had?

It makes no sense to me that Halifax will happily pre approve me for thousands of pounds worth of overdraft but not for a loan

Overdraft approval is based on the way you operate your accounts with Halifax. Personal Loan approval is based on that AND credit scoring taking into account credit reference information.

Time at address = not long
Credit searches by catalogues and loan companies = a few
Existing debt exceeds £2,500 and often goes outside agreed limit = don't want to lend you more

- Get your balance below £2,500.
- NEVER exceed your overdraft limit again.
- Visit the Debt-Free Wannabe forum and work out how to reduce your outgoings and manage your overdraft down. A loan isn't the solution to the problem. Earning more and/or spending less is.

paddyrg

Also, why would Halifax want to give you a loan to pay off a lucrative overdraft? If you go over your limit they charge a healthy fee...

opinions4u

paddyrg wrote: »

Also, why would Halifax want to give you a loan to pay off a lucrative overdraft? If you go over your limit they charge a healthy fee...

But this isn't the reason for them declining a loan application.

The mismanagement of the account is.

The loans department does not want the potentially dodgy debts of the current account department.

marks77

If someone has a few searches for payday loans does that affect a decision?

Fiddlestick

At the end of the day, if you can afford the loan repayments then are you able to take the money that you *would* spend on the loan and use it to reduce the overdraft?

How much are your OD charges each month and how much were you hoping to spend each month repaying a loan?

redpete

Kirstyc wrote: »

It makes no sense to me that Halifax will happily pre approve me for thousands of pounds worth of overdraft but not for a loan.

You agreed to have the overdraft instead of a loan and presumably intended to pay it off in the same way you would have done if it was a loan. You needed £1500 for the car yet have now gone over £2500 on the overdraft.

If the bank looked at the overdraft they would see that you have failed to pay it back at all (otherwise you would not be going over the limit), so they would have no reason to think that you could afford the repayments on a loan.

The only thing bad on my credit file is im not on the electoral role as i moved recently

and presumably the way that you are not dealing with your overdraft.

You need to get on the electoral roll now, cut back to the bare minimum on all spending, do what you can to increase your income and pay down the overdraft, then in 6 months you might be able to try to get a loan again.

themull1

can u not open a co op bank account and transfer your salary in there, and then start paying off your overdraft?