Loan company to pay off credit cards

otoodles

We have been approved for a secure loan and the loan company says they settle all outstanding finance they are asking for settlements figures and up to date credit cards statements, would prefer to do it ourselves but apparently this is not possible. Is this the norm does anyone know?

BugsyBrowne

otoodles wrote: »

We have been approved for a secure loan and the loan company says they settle all outstanding finance they are asking for settlements figures and up to date credit cards statements, would prefer to do it ourselves but apparently this is not possible. Is this the norm does anyone know?

Not sure but I bet that secure loan you have took out is costing you,not a fan of secure loan lenders myself.

Tixy

I don't think it is the norm these days. But if they are prepared to give you the loan only on this condition then I would guess that this is their right.

I think it used to happen more often but rarely now. I have seen posts by a couple of people who did something similar years ago and then found themselves being chased years later for the debts that were supposed to have been cleared by the consolidation loan company - either they paid the other creditors late so the settlement figure was no longer valid or forgot about trailing interest or they didn't pay them at all. The people had a right faff proving their postion.

If you go down this route I would suggest you make sure you have copies of all the relevant paperwork. Make sure you have clear info as to exactly who the consol company have paid, how much and what date. And get statements from the other creditors to show that the debts are fully paid and that you now owe nothing (and then keep all the copy paperwork).
As its for credit cards then do double or triple check your statements for any trailing interest, later transactions being charged to your cards etc.

gscrym

We had to do this when we were accepted for a secured loan from Firstplus a few years ago. It was one of the last steps I took in getting credit before accepting that I had too much and needed help. Anyway, I digress.

If memory serves, they said it had to be done that way to ensure the funds were used for the purpose I had requested them for. I had asked if I could just do it myself but they said no. I had to get settlement figures and Firstplus issued cheques for me to send to each of my creditors. They were sent out recorded delivery.

I suppose it's there way of saying they're a resposible lender, incase a client got a large secured loan and didn't consolidate debt. Unfortunately, I didn't cancel my cards so ended up running them up again. My fault, no-one elses.