Need some advice regarding a loan to pay off overdrafts please...

SmoggyTalisman

fozmcfc wrote: »

Of course every case is different and until you are accepted, you are still in the hoping stage.

I applied for a Virgin card, when I had debts of about £13k on a £25k salary back in 2009 and got accepted with a 6k limit.

Although I had a lot of debt, the main thing going for me, was that I had a long decent credit history with no missed or late payments, when I applied, just had debt from overspending

Virgin is backed by MBNA, which many report do offer high credit limits. It was my highest by a good couple of thousand.

Of course at the end of the 26 months, nothing to stop you transferring the remaining balance to another balance transfer card again for a small fee.

I ended up with £4300 on the card and managed to pay it off within about 20 months to avoid interest.

EDIT......They normally allow you to transfer upto 90% of the limit, so you'll need a £4k limit to clear the overdraft.

Good luck

I see, thank you. Even if I can get it to clear the overdraft I would be over the moon as that is the real hindrance. The loan I can pay off monthly no problem.

I just worry as to how much credit they will offer me, can you ask for a certain amount or do they just state how much they can put on the card for you?

fozmcfc

Firstly don't apply now, because you won't get an instance decision, they only give an online decision Mon-Thur 8am to 8pm and Friday 9am - 5pm according to the website. That will give you time to mull it over.

When I applied online they asked me, if I wished to make any transfers and how much for. I then luckily got accepted straightaway and it told me there and then my limit, which as I say was 6k.

Then once I got the card, I activated it and did the transfer.

It's all very easy to do the transfer all online, you just enter your bank account and sort code and it goes in within a day or two.

I would imagine that normally the limit given to start with, is the maximum they will offer for a certain amount of time. It is highly unlikely they would up the limit immediately.

I erm'd and ahh'd for a day or so about applying, but to be honest the only way you are going to know, is to make the application and see if you get a yes or no. I was expecting a no and when I got a yes and enough to cover my high interest debt, I was over the moon.

So you are really going to have to bite the bullet and apply and think positive lol.

Even if you get a no, 1 credit application isn't going to hurt your status. You can still look at other options available, such as the bank.

SmoggyTalisman

UPDATE

So I rang Halifax this morning to enquire about loans etc. they said a loan would not be offered so I asked to sort a monthly debit going out to pay off the overdraft and that once each amount was paid off, the overdraft could not be used to avoid me slipping back into it. The kind lady spoke to the collections team? Who have set up a case but informed me they could not do anything else until Monday as the case needs approving first and that I should call back Monday.

Couple of questions;

1. Will they agree to this agreement I have proposed, I'm thinking between 60/100 a month to be paid off.

2. Is it worth my while asking if they would waive the overdraft charges to help reduce it quicker?

Thanks for any help

---

On a side note, I finally asked them about the problems I was having with their automated phone service when it asked for my D.O.B. and kept saying it was wrong. This has been happening for years now but never thought anything of it. Anyway, they said the D.O.B. they have on file for my account is wrong!? They said they can't correct it over the phone and I need to go into branch Monday to sort it with identification documents. They have refunded me the cost of the call as it was on my mobile and have also credited me with a £10 gesture of goodwill for any trouble caused. When I set up my accounts it was years ago in a branch so god only knows how they got my date of birth wrong by a few days!!
That money from the goodwill gesture is going towards paying off the overdraft btw!

TheMoney

I'm struggling to understand, if you can afford to pay off a loan each month, just pay that amount off your overdraft instead. A loan would leave you with the overdraft their to use again. Plus, overdraft charges will decrease as the balance goes down, whereas loan repayments will stay fixed.

YorkshireBoy

TheMoney wrote: »

I'm struggling to understand, if you can afford to pay off a loan each month, just pay that amount off your overdraft instead.

There would be no benefit to the OP in doing that. See below.

...overdraft charges will decrease as the balance goes down

Sounds like the OP has a Halifax current account (they said it's £3 per day for >£3K), so you're not comparing like with like, ie 'interest rates'.

If OP can't get a loan or credit card, they may as well put their O/D repayment money in a savings account until they have enough saved to drop them on to the next tier down, ie £2 a day for £2-3K and £1 per day for under £2K.

CLAPTON

SmoggyTalisman wrote: »

UPDATE

So I rang Halifax this morning to enquire about loans etc. they said a loan would not be offered so I asked to sort a monthly debit going out to pay off the overdraft and that once each amount was paid off, the overdraft could not be used to avoid me slipping back into it. The kind lady spoke to the collections team? Who have set up a case but informed me they could not do anything else until Monday as the case needs approving first and that I should call back Monday.

Couple of questions;

1. Will they agree to this agreement I have proposed, I'm thinking between 60/100 a month to be paid off.

2. Is it worth my while asking if they would waive the overdraft charges to help reduce it quicker?

Thanks for any help

---

On a side note, I finally asked them about the problems I was having with their automated phone service when it asked for my D.O.B. and kept saying it was wrong. This has been happening for years now but never thought anything of it. Anyway, they said the D.O.B. they have on file for my account is wrong!? They said they can't correct it over the phone and I need to go into branch Monday to sort it with identification documents. They have refunded me the cost of the call as it was on my mobile and have also credited me with a £10 gesture of goodwill for any trouble caused. When I set up my accounts it was years ago in a branch so god only knows how they got my date of birth wrong by a few days!!
That money from the goodwill gesture is going towards paying off the overdraft btw!

I'm not sure it's a brilliant idea telling a bank that you are useless dealing with money.

Why not try the 0% BT Virgin credit card route first?

Even if you can't get a 0% BT card then it would make sense to use virtually any CC for ordinary spending to get your OD under 3000.
This move you to £2 per day rather than £3 per day saving at least £30 per month.

pauletruth

not sure that was wise. will they now tag it as agreement to pay. which is bad on your credit history.

SmoggyTalisman

Why is an agreement to pay bad on your credit history?

I haven't actually said i can't handle my money or I can't afford anything. All I have asked is if it can be set up to become a DD coming out to pay it off each month rather than me just paying as and when, I don't see it as a problem myself

Oh, I forgot to mention I applied for the virgin CC and got rejected so that option is out of the window.
Also, regarding a step down to the smaller interest tier with a loan, I get a bonus next month which should be a large enough amount to drop down to the £2,000 tier so I intend to use that bonus to do that once I get it.

I'm going to ring tomorrow and see what they say anyway regarding this all. Like I stated the other day, I'm new to all this so might seem naive in my replies!

YorkshireBoy

SmoggyTalisman wrote: »

Why is an agreement to pay bad on your credit history?

Serious question?

It will be recorded on your CRA file that you couldn't/didn't meet your contractual obligations.

Other lenders will see this and wonder if you'll do the same to them.

SmoggyTalisman

I wouldn't have asked if I didn't want to know the answer...

I see what your saying, I was just seeing it like this;

my contractual obligations are to pay the overdraft off in full yes? i intend to do this, i just want to set up a direct debit to it so that i can pay it off month by month and that they know of the method i intend to pay it off with