Can you reduce a Barclay's loan repayments

asoe209
asoe209 Posts: 362 Forumite
Part of the Furniture Combo Breaker
Hello all long time lurker 1st time poster here.

Was hoping for some advise really.

My other half has a personal loan with barclay's I think its around 10k some thing like that. She has been paying it off for years but she has come to a point now where it is just to much with all the other bills to pay i.e. credit cards and store cards as well as house hold bills.

any way this barclays loan is taking a big chunk of monthly pay. some where in the area of £350-£400 a month. As far as I know she has never missed a payment.

I have advised her to call the bank and see if there is any way of reducing the monthly payments. Which she has not done but even month she gets into a state as she has no money left after all her bills are paid.

She says there is no point in calling because they cant do any thing, or it will me that she will have to be bankrupt. Im not sure if this is true or not. but I cant see why they would not reduce the payments over a loner time.

so really what i want to as is there any way that she can get these payments reduced. and if she cant cant barclays continue to make her pay the high payments even through she cant afford it?
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Comments

  • Apples2
    Apples2 Posts: 6,442 Forumite
    asoe209 wrote: »
    She says there is no point in calling because they cant do any thing, or it will me that she will have to be bankrupt. Im not sure if this is true or not. but I cant see why they would not reduce the payments over a loner time.
    Lenders don't normally entertain any discussion about hardship until you can prove you really are facing hardship.
    This means falling into arrears by missing payments.

    The original loan was offered based upon risk. If the original loan was over a shorter/longer period, it would have attracted a different APR.
    If it were as simple as calling and asking, we would all take loans at the shortest term/lowest APR and immediately call up and extend the term, we would all be quids in paying low amounts for huge loans.

    Your OH is correct in as much as they will not care too much until you miss payments, then it is passed to a recovery department who have more powers of restructuring/payment plan etc. He Credit File will be suitably marked.

    You can ask to restructure the loan which essentially means taking out a brand new loan which will be used to clear off the old one. This will be a new application so your OH would need a spotless credit file along with a decent debt/income ratio to be accepted for another loan.
  • maginot
    maginot Posts: 484 Forumite
    Part of the Furniture Combo Breaker
    How much is left on the loan?
    If she has been paying £400 for years there can't be much left on a £10k loan.
    She could ring them, but she is looking to take out a new loan e.g. Pay off the current one and take a new one out over the longer term. They may be willing to do this, but she will be paying back loads more interest and be in debt for a lot longer.

    I understand people need to have more than just existence and earning enough just to cover bills, can she cut back anywhere else?
    Get her to post up and SOA? If she keeps throwing £400 at the debt it will be gone before she knows it and then she can start to enjoy herself with the extra £400, rather than only having an extra £50 a month by taking out a new loan!
  • CLAPTON
    CLAPTON Posts: 41,865 Forumite
    10,000 Posts Combo Breaker
    the first thing for her to do is to gather all the facts about income, spending and the full debt details

    this is a good start

    http://www.makesenseofcards.com/soacalc.html

    then get her to post up the details either here or on the debt free wannabe board

    without knowing about her other debts and other financial details it's impossible to give any sensible advice.
  • asoe209
    asoe209 Posts: 362 Forumite
    Part of the Furniture Combo Breaker
    Thanks for the replies. From what I know the loan will be finished in 2015 at some point.

    She works 2 jobs her main office base one and a cleaning job in the evening.

    from what we worked out she cant really touch her main pay. which is some were in the region of £1300-£1450. I said it would be best to just leave that leave the card at home and let all the bills come out of that.

    then just try and live off of the cleaning pay. some how she manages to get things all messed up. I dont really see where she spends but there must be extra spending some where as last month for instance she had some thing come out and put her £60 over drawn so she was charged on top of that.

    I try to help as much as I can but i have my own bills as well, but i know my account like the back of my hand what's iin there when stuff comes out how much ect.

    We plan to save to buy a house which is years away still as we both have to pay all out debts. but were both worried that calling the bank to see if any thing can be done and going through with it will effect out chance of getting a mortgage.
  • CLAPTON
    CLAPTON Posts: 41,865 Forumite
    10,000 Posts Combo Breaker
    she needs to complete the SOA and see exactly where the money is going
    http://www.makesenseofcards.com/soacalc.html
  • asoe209
    asoe209 Posts: 362 Forumite
    Part of the Furniture Combo Breaker
    ok ill get her to do that and see what comes of it.
  • Apples2
    Apples2 Posts: 6,442 Forumite
    Going into an Overdraft and drifting beyond it's limits would put the Royal Kybosh on a loan acceptance, you need an alternative plan as outlined above, reign in the spending and live frugally for a while.
  • asoe209
    asoe209 Posts: 362 Forumite
    Part of the Furniture Combo Breaker
    im all for that... she one of them people that seems to break there back for other even if she does not have it.

    Like friends birthdays and stuff. there are time where the may be 2 or 3 in the same month. but she goes out of here way to get gifts and cards when she cant afford to do it. I say just get a card there your friends they will understand they no we have just moved and things are tight ect. but talking to a brick wall.

    then borrow from her family i cant seem to get her to see.
  • simon2010
    simon2010 Posts: 101 Forumite
    Hi As209

    Well, I can speak from experience on this one!

    I have a barclays loan that was £340 per month. I was struggling with it. I missed a couple of payments, they wrote a letter etc. I explained that I was struggling to pay etc, they said that once I have missed three payments I can get a 'resolve loan'. Which I did.

    So - stop paying the loan altogether. Yes, she will get three late's on her credit file, but if she is not intending on applying for credit in the next year or so, it should be ok. My loan and overdraft were put into one loan over a longer period of time nd I only pay a more manageable £140 per month.

    Hope that helps.

    Ps - I am not encouraging you to stop paying the loan, merely explaining what happened to me.

    Cheers.
  • maginot
    maginot Posts: 484 Forumite
    Part of the Furniture Combo Breaker
    From the looks of it, she needs to cut back on spending rather than extend loans. Otherwise she will end up extending the loan but end by running up other debt elsewhere.

    2015 is not far off, try looking at it month by month and then you will have much more disposable income to afford a mortgage!

    How much did she originally borrow? As she has been paying the loan for years, so has paid £10-£15k already and I presume the 10k is what is still owed as she is still going to be paying £350-£400 for 3 years :(
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