Good Credit Record - But Overcommited

xgingerx

Hi, I have a good credit record but when I have applied for several loans to consolidate but have been refered and when they got back to me said I appear to be overcommited or using too much of my available credit (upto limits in most cased) My credit file was fine.
I am savvy with snowballing my debts so think this is the first thing im going to try and do but the frustrating thing is by consolidating I could have reduced my monthy outgoings from around 750 to 300 which would have made me more financially stable.
I owe 26k, earn 26.5k am not a home owner.
I think I might have answered my own question which is to pay off what i owe to reduce my debt to income ratio but wondered if i had any other options????

I do have a second income through my wife but we do keep finances seperate as her file is not as clean as mine is. So what I am saying is Im not in danger of missing payments or defaulting but really would like to free up some of my income even if it means paying more interest over a period of say 7 years.

Any views are appreciated as I feel like Im not sure what the best course of action is and need some advice

Thanks

Bestthingsinlifearefree

Post an SOA

http://forums.moneysavingexpert.com/showthread.html?t=107280

consolidating is just moving debt around, you are living above your means, you need to be trying to pay back the debt not moving it around to free up more money for more spending.

I wish you well.

wherediditallgo

They may have been doing you a favour by turning you down, as unless you only take out a consolidation loan for only what you need to clear the debts, & then use it all for that, chances are some of the debts & what you used to accrue them will still remain. You'll then have temptation at your fingertips, possibly leading you back to the same level of debts you started with or even worse. If some of the debts are personal loans or on credit cards, you may be able to re-negotiate the interest rate or move the debts to 0% interest agreements. Posting an SOA is a good idea, as it will help you & others to see where you can make changes.

xgingerx

yep, think u r right about getting refused, ive looked at a snowball calcuator and think this is the best route, pay off and get rid.

I feel there is light at the end of the tunnel but its going to take time and disicpline to stop spending and paying off what i owe !!

Thanks for all advice.

dreams_R_free

Not really totally relevant to your situation but may help.

Several years ago I applied for a big loan (was 'invited' at a special rate and was supposedly already 'pre-selected) but was surprisingly turned down. The reason given was that I had too much available credit:eek:. Admittedly I had about 7 CCs at that time with a total Credit Limit of about £80K but apart from £1000 owing on one and £850 on another the rest were all paid off! I also had no other major debts or outgoings at that time (no Mortgage for example) and a reasonable salary. My credit history was exemplary(in those days anyway, but pretty disastrous at the mo:eek: )

I was nonplussed and phoned them for clarification. They said I had the 'potential' to max all the cards and be in financial difficulties(presumably because the lines of credit were open) and it would be in my best interest to close several of the paid-off CC Accounts. I did this, re-applied for the Loan a couple of months later and got it straight away .

Good Luck:beer: