When to apply for a loan. First time

gavin_1990

Hi guys. I am need of a loan for some home decoration and a couple of new appliances ect.
Right I am 20 and have been living in private rented accommodation since I was 17. Been in full time employment since leaving school. I’ve recently moved 3rd house now and have registered on the electoral register for the first time. They said I would be on the register on the 1st of July. I’ve updated all details on credit expert. Past credit is for a sofa from dfs in which i have not missed a single payment.
I want 1k over 1 year that’s all for as i said home improvements and to maybe boost my credit rating as I want a mortgage one day.
So how long should I wait as I’ve only just got on the electoral register and just updated my details on credit expert today.
Thanks All.

LovelyLeeds

If you only want a loan for a year, and it's only £1000 - surely it would make better sense to save £1000 over the next year and then you could buy your appliances outright??
Ok, that's not what you wanted to read, so how about asking your bank for a £1000 overdraft? At least you can pay it back as much as you can, possibly even before one year if you are careful and budget for this.
Alternatively you could try to obtain a credit card with a £1K limit, once you've bought your appliances, cut it up and concentrate on paying back at least £110 a month for a year.

gavin_1990

Well i really need to money now. Washing machine broke and could do with a few outher things.

I dont mind getting a credit card but didnt think there was many with a 1k limit for a first time borrower.

Thanks for the help.

bengalknights

As lovelyleeds states the best bet would be overdraft and credit card as loans for that low amount would probably only be found from sub prime lenders or the payday people.

bouncydog1

"Could do with a few other things" - couldn't we all! At the age of 20 you really do not want to start down the debt route unless it is essential. Have a look at the freecycle pages in your paper or online for your area - I have seen almost new washing machines being given away because the owner doesn't like the look of the machine etc.

If you borrow £1k over a year you have to pay back at least £90 per month assuming a low interest rate. Why not save the money with your bank or building society then at least they can see what you can afford. You already have a sofa loan - get that paid first otherwise you will be increasing your debt to income level which will put borrowers off as it looks as if you are desperate for credit.

GAH

Or the other thing you can do is rent some appliances which is quite cheap and in the meantime you can save up to buy, that way you don't have to apply for a credit card or overdraft.

blacksta

Rent the appliance seems a very good advice - I am very sure you can get washing machine for at least 20 pm. Be very careful about debt - Save up and buy the appliance outright. I bought a washing and fridge in 2002 till today machines are still running - no such thing as good debt, it is myth.

paddyrg

Home improvements and appliances are not really the right kind of thing to get into debt over, but I think you're asking 2 questions really

The first being 'my WM is broken, what can I do?' (Answer, try freegle/freecycle/back of the local paper - you would be surprised)

The second being 'I want to build up a credit history so I can get better rates when I want a mortgage in the future' - here borrowing a grand for a year is more sensible, but not spending the cash! I did this once, years back, when I couldn't get a credit card because of a lack of history. Borrowed a grand from the bank for the shortest of terms, paid a bunch of interest, but now have lenders queueing up despite having nothing like the income I had (but knowing that, I don't accept their offers!). If cou can afford to borrow, stick the cash in a high interest account to offset some of the losses, and repay, it will boost your credit record.

But if you think you will spend it on non-essentials (decorating, new appliances) then steer clear would be my suggestion, don't think of this as a race to get the biggest debt you can soonest, which is how some people treat it!