Joint Loan applications keep getting refused

be11y

Hi, just wondering if anyone can share any experience or advice.

Me and hubby 2 be are looking to get a joint loan for £20k.

We both have a joint account, neither of us have had any CCJ's or excessively bad credit history, maybe a few missed credit card payments over the years but minimal and we both have records of paying off loans/credit cards in the past and closing accounts when balances have been settled. We also have some credit cards that have limits (not balances) of near £6k! We have changed address once in the past 5 years and only I have changed jobs once in 4 years, so our background history is pretty solid and we have been together (linked on records etc) for 7 years.

Anyway, we have applied to 3 or 4 places so far and they have all said no and its beginning to get to me (

We want the loan to consolodate our joint credit card debt (we stupidly learnt from our mistakes a good few years ago) cos at the moment between us we have about 8 credits cards of which we only pay the minimums which total near £550 a month so we'd rather have a £20k spread over 3 years paying £600 a month.

Hubby 2 be is 27 and I am 23 and I earn around £23k and he earns around £25k so I really cant see why it's a problem, we know 100% we can afford it, we dont pay rent or have a mortgage!!

Can anyone help/suggest a solution!

Xbigman

Your have several problems.

Your credit card limits are one factor that stands against you. A large amount of available credit, even if unused, is a worry for lenders. You should reduce your credit limits on the active cards to the minumum you can, and close anything unused.

Those missed payments are not a major concern but they do knock your credit score down. How many were there and how long ago?

And making multiple applications also knocks your credit score down. It makes you look desperate.

You could still get a loan but it would probably be at high rates.

You say money is not a problem with joint incomes of 48k. Then you should probably start aggresively paying off those credit cards to clear the debt.
This is much more preferable than consolidating, which has well known drawbacks, in particular taking loans at lower interest but over longer periods actually means paying more interest. 6 months or a year from now you should have a sufficiently improved your credit score to pick up some 0% cards and then you will rapidly clear your debts.
Regards


X

Phoenix79_2

It might be worth both of you getting copies of your credit files to see if anything flags up on there. £2 each. They are pretty quick. Got both of mine within 3 days.
http://forums.moneysavingexpert.com/showthread.html?t=51087

be11y

Xbigman wrote:

Your have several problems.

Your credit card limits are one factor that stands against you. A large amount of available credit, even if unused, is a worry for lenders. You should reduce your credit limits on the active cards to the minumum you can, and close anything unused.

Those missed payments are not a major concern but they do knock your credit score down. How many were there and how long ago?

And making multiple applications also knocks your credit score down. It makes you look desperate.

You could still get a loan but it would probably be at high rates.

You say money is not a problem with joint incomes of 48k. Then you should probably start aggresively paying off those credit cards to clear the debt.
This is much more preferable than consolidating, which has well known drawbacks, in particular taking loans at lower interest but over longer periods actually means paying more interest. 6 months or a year from now you should have a sufficiently improved your credit score to pick up some 0% cards and then you will rapidly clear your debts.
Regards


X

The missed payments were at least a year ago when we didnt have a joint account. Now everything goes out of the joint account via direct debit and there is never a problem.

We cant pay any bulk payments on to the credit cards as every spare penny we have goes in to savings as we are saving for our wedding next year and also for a deposit for our house.

The money we pay to our credit cards each month I just want to change in to a loan payment so I know in 3 years time thats it we are debt free.

I do understand the procuders, scoring etc as I used to work for a finance company, it just frustrates me so much that you're "allowed" to clock on £20k of debt but no one willl let u move that debt somewhere else to consolidate.

Tassotti

You have fallen into the basic bank 'trap' of saving and not clearing your debts.

Read this site homepage from front to back

lynzpower

tassottis right
there is absolutely no point in saving ( at what 5% pre tax) if your debt APRs are higher than this. Its equivalent to borrowing money to save.

Read martins article about debt and head over to the DFW board.

I suspect you wont get a loan unless you go with sharks like Picture or similar. Avoild.

Tassotti

no need for that :j

regularsaver1

You say you don't currently pay rent or a mortgage - so why don't you post your SOA to see what spare money you have. Where do you currently live? are you on the electoral roll?

I can understand saving for the wedding, but you need to pay more off the creditr cards before thinking of buying a house