Tesco loan High apr - should we look elsewhere?

moatmeister

Wife, self employed with excellent credit profile has applied for £10k loan with tescos because she has good and long track record with them. Their headline rate is 6%, After three weeks of too-ing and fro-ing They have offered her 11.5%. Not very happy.

Initially tried an application with Nationwide using their "soft search" that was instantly refused on a home owning technicality.

Any other loan companys do "soft" quotation searches?

Should she accept or apply elsewhere to try to get a better rate bearing in mind the full application has now dented her credit file?

opinions4u

11.5% for a non-home owner who is self employed is pretty good.
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But saving is always an alternative.

moatmeister

Please dont set me off again, I've only just recovered!!!

She is a homeowner, she owns 3 houses. She just doesnt own the one we currently live in and are registered at.

And your correct,saving is a good option and will be he way forward in the very foreseeable future but need to raise some cash first!

somethingcorporate

If she owns 3 houses is there no opportunity to take extract any equity from the properties. As long as there is no overpayment penalty and you are disciplined and overpay as you would make payments to a loan for the same amount and period you will likely get a significantly better rate than the 11.5% already offered.

Of course if you do not overpay then you secure the debt (bad idea) and also pay it back over the life of your mortgage (bad idea). So if you do go down this route make sure you understand how you need to operate to make it work.

moatmeister

That would be ideal but for various reasons raising equity from the property is not possible. Yet. Need to finish some renovation works first before remortgage or further advance is possible.

No one has yet answered the orinal question, which was given that we have submitted a formal application with the associated credit search, does this significantly reduce our chances of applying elswhere to get a better deal??

opinions4u

That would be ideal but for various reasons raising equity from the property is not possible. Yet. Need to finish some renovation works first before remortgage or further advance is possible.

So it's a personal loan to fund the improvements to her property empire?

I'm not sure Tesco lend for business purposes.

No one has yet answered the orinal question, which was given that we have submitted a formal application with the associated credit search, does this significantly reduce our chances of applying elswhere to get a better deal??

One search makes little difference. More could become troublesome.

moatmeister

No, loan is for home improvements to our residential house, mortgaged with GMAC that no longer do further lending