Personal Loan Worries

JessieLou

Hi, I know that alot of people are asking the same sort of question, I just need a bit of advice.

I have quite a few bits of lending and I do want to start bringing them all down but before I do I need to get a Loan to pay my Mum some money that she leant to me. I have a fair credit score however I have already scored one loan through sainsbury's and got rejected.

I really need to get this money for my mum and then I am looking to start getting rid of all my debt. Any ideas of where I should go for the loan or advice I need.

Please help

Thanks

poppasmurf_bewdley

Your so called Credit Score means nothing to anybody. It's given in exchange for your money by credit search companies who do not lend money.

If Sainsbury's have turned you down for a loan, then you have a problem. You need to get a copy of your Credit Report.

Another problem is that you want to wean yourself off loans but first you need a loan!!! That's like the drunk saying "I can give up the booze but first I need a large scotch!"

JessieLou

Yer I get that, I am the first to admit that I have been silly with money in the past unfortunately due to ex partner etc.
However, I know that I will be getting some of the money back within the next few mnths and I know that I am getting a pay increase which will mean that I can get rid of Credit card and previous loan just leaving this one that i need now.

My credit report looks pretty good, only thing is I have moved a few times in the past year

Thanks

maginot

If I was you, just start using your extra money you have to start making payments to your mother.

The loan from your mother will probably be much cheaper.

If you have already made mistakes with borrowing, you now need to start improving your credit by paying off debts without taking out debt.

JessieLou

Yer, that would be the plan in an ideal world however my mum needs this money for a house deposit within the next month. I know I know, messy!

maginot

What is your yearly income?
How much debt on your credit report do you have?
Do you have any defaults or missed payments?
How much do you want to borrow?

As has been mentioned, the fact you have been turned down already and you yourself say you only have a fair rating does not bode well! It may be that you are going to have to do a lot of apologising to your mum.

JessieLou

lol I think you could be right.

Yearly income £16500
Debt showing on credit report £7000
No defaults, No missed payments ever.
Want to borrow £6000

As I said my income is going up and my outgoings are going down, I haven't checked my score for quite a while. But last time it was fair. I don't see the point of paying money to see that. Is it worth knowing or is it pretty irrelevant?

Thanks

TadleyBaggie

The problem here, to a lender it appears you want to extend your debt to £13000, which for an income of £16500 is far too high. Although your intention is to repay some of your existing debt, they have no idea if you will actually do this. They evaluate risks, and risk to them would appear to be too high.

maginot

Rule of thumb is that lenders tend not to give unsecured debt that is more than 50% of income.

You will be lending significantly more than this, not to mention the debt owed to your mother.

Credit reports are useful to have, but remember to only pay for the £2 ones rather than sign up to monthly payments for online access. You don't need to see them all the time. This may give you more information bout why stains buys send no.

However it is more likely due to your current high debt to income ratio and needing to borrow more money is a big no no for banks in this current climate.

JessieLou

Ah ok, that is fair enough. lol So would you say that there is no way I would get approved for this loan

Apples2

It's unlikely but not impossible.

By not impossible, you need to consider you are not a good risk to any lender, so even if you do find anyone prepared to lend to you, the APR thye offer will be reflected against your risk (it will be HIGH).
You'll effectively be swapping a zero interest loan to your mum, for a massively higher repayment to a lender.

You will be going backwards, not forwards in your quest to be debt free.