Where to start with loans.

Disney_Pluto

Hi Guys,

Im hoping someone will be able to give me some advice. I need a loan to buy a new car. My car is now starting to cost more than what its worth and as a district nurse I have to have a car to work.

I need to borrow around 3k as will have money from selling my car and also have a few savings to go towards the new one. Im not going to lie, I know very little about loans although I am trying to read up about them.

Few things about me some of which worry me that I may not be excepted for a loan.

Have 2 credit cards which I use occasionally and always pay off in full as to get no interest on them

I have my phone bill that just comes out DD - no late payments or anything and been doing that for around 5 years. I also pay my car insurance DD each month again no late payments etc.

I have a next credit account which I sometimes buy on but again its always paid off in full.

So dont have any debts and never made any late payments or anything and to be honest dont really have much credit history.

My boyfriends got a share save in work which finishes november next year so although I want the loan over 2 years I will be paying it off early with a lump sum next year.

The problem is :
I have only worked in my work place 11 months as I was a student nurse before this.

Myself and boyfriend bought a house in December so have only lived in our house 8 months - we are on the electrol roll though.

I only lived in my previous house 3 years.

Does anybody have a good starting point and do you see any reasons as to why I may not get accepted?

Thanks for reading and apologies if its really long.

[Deleted User]

try your own bank first might be the best place,can you get a graduate loan from them?

LovelyLeeds

From what you've said, you come across as being quite savvy re your financial management. I'd approach your own bank first - face to face appointment rather than applying online.

Disney_Pluto

I forgot to mention that my bank - HSBC I have only been with 11 months. I moved to them as my boyfriend had been with them years and Abbey were awful when I was a student, so was easier to get a joint account and current account with them.

So the fact I have only been with them 11 months will this change anything?

Also the fact I only need around 3k, would it be better actually borrowing more to get a better APR rate then paying most of it back straight away.

Sorry guys told you I wasnt very clued up. Thanks for your help so far very helpful. :beer:

paddyrg

Do not be tempted to borrow more than the very minimum you need! Borrowing £5k instead of £3k for a slightly better rate is going to end in tears, remember rates are only going up from here, so you want to get debt-free as fast as possible!

The only other suggestion is do you really need so much? A £2k-ish car could last you 5 years if you choose well, and depreciate a lot slower than a more expensive one. Have a bit of a look around, there are deals to be had.

bouncydog1

I know that a lot of people don't like to deal with HSBC but personally we have found them excellent and very flexible. I would suggest that you make an appointment to go in and see somebody.

Go armed with all of your financial information - a full budget of income and outoings so that they can see how you are going to afford the car. You will find it helpful to project your costs for a full year - make sure you include things such as house insurance, car maintenance, and any one off costs. Don't leave anything off - better to over estimate a little in my view as this will give you a bit of headroom for unexpected expenses.

The bank need to feel comfortable that you have thought about the process properly and that you will be able to fund repayments. In the event that they offer you a loan I would personally ask how long you have to accept it and say you would like to think about it for a couple of days so you are sure. Good luck.

telboyo

You say you don't much of a credit record I think you will find you have a very good record. couple of cards and and a phone with all up to date payments is a good place to be.

Disney_Pluto

Thank you everyone.

So the fact that online the APR with HSBC and most banks for borrowing less than 7.5k seems to be really high, does this differ if I was to go in to them myself and speak with them?

I know most people think I'm probably crazy for spending a fair bit on a car but when I need a reliable car for work and I also spend most of my working day in my car I would like something thats fairly good.

I hope my credit score is good. I have ordered a report from Experian to roughly see whats on there.

Again thank you for your help.