Unsecured Loan to Consolidate Debts

jetskiguy

Hi all

I have a decent paid job of £23k a year but i have nearly £900 a month in debts to pay out so im unable to really save anything, i can afford my repayments but my credit history has been affected by applying for loans that have been declined. And i have a default on my credit history which is badly affecting the applications, but that has been paid off in full and i not owe nothing to them, but of course the default is still on there for the next 5 - 6 years.

I need an unsecured loan over a 4 year period of £16k to consolidate everything i owe, this includes paying off my current loan, my car finance, credit card and money that i owe to a friend.

This will then bring my debt outgoings down from like £900 a month to around £400 a month, meaning i can actually save some money for a mortgage.

Does anyone here know of any decent loan brokers that could negotiate a loan on my behalf? Rather than me getting automatically electronically rejected.

Clive_Woody

Realistically the most you would get as a loan is around 50% of your salary and that would be if you had no current debt.

If you currently owe £16k and want to borrow an additional £16k to consolidate that (any lender would look at that as a total of £32K debt as they have no assurance that you will repay the first debt with the new debt) then on your current salary that is not going to happen.

jetskiguy

Clive_Woody wrote: »

Realistically the most you would get as a loan is around 50% of your salary and that would be if you had no current debt.

If you currently owe £16k and want to borrow an additional £16k to consolidate that (any lender would look at that as a total of £32K debt as they have no assurance that you will repay the first debt with the new debt) then on your current salary that is not going to happen.

Yeah thats exactly what i was thinking, im in a no win situation really. I need one that will automatically pay off the debts on my behalf so they know that they are being paid off.

WillyWonga

That amount would be pushing the limits. Yes there will be firms out there - remember the old style secured loan adverts usually in Sunday payments - interest was high and just shifted the problem not cured it.

jetskiguy

WillyWonga wrote: »

That amount would be pushing the limits. Yes there will be firms out there - remember the old style secured loan adverts usually in Sunday payments - interest was high and just shifted the problem not cured it.

Yeah the high interest ones i of course would not go anywhere near, my current loan is with Nationwide and then theres my car finance but the car finance is 0%. However i wanted to get the car paid off so then i could sell it and buy something else for cash, not on finance.

I could carry on paying what im paying now each month but i wanted to be able to save, but currently i cant. I only have enough left to live off after paying my rent, car insurance etc

longtermplanner

It sounds as though you are just going to have to carry on making the repayments for 6 months then think again about refinancing. At that point your overall debt will be lower - don't make any more credit applications until then!

If you have any spare money then ideally you would pay it off the highest interest debt - probably the credit card? - but in your situation I might prefer to repay my friend first.

After 6 months, think about refinancing part of your debt rather than the whole amount. If the car finance is at 0% (really?) then it would foolish to refinance that.

DCFC79

Cut your spending is an option.

jetskiguy

DCFC79 wrote: »

Cut your spending is an option.

Thats already cut, i dont spend anything on myself. £50 a month is my food budget which i stick to. £120 a month on fuel to work and back etc. £60 a month car insurance. Ive moved into a shared house to get rent down so thats £200 a month including bills. Then theres other expenses that crop up like new car tyres etc so i do have emergency fund which i chuck to one side but that only just about covers these things.

Everything else is debt payments.

jetskiguy

longtermplanner wrote: »

It sounds as though you are just going to have to carry on making the repayments for 6 months then think again about refinancing. At that point your overall debt will be lower - don't make any more credit applications until then!

If you have any spare money then ideally you would pay it off the highest interest debt - probably the credit card? - but in your situation I might prefer to repay my friend first.

After 6 months, think about refinancing part of your debt rather than the whole amount. If the car finance is at 0% (really?) then it would foolish to refinance that.

Im paying my friend off first, i was lucky enough to get a 0% balance transfer for 30 months credit card so i transferred old credit card over to that one and then cancelled the old one.

tell_it_how_it_is

Maybe post a statement of affairs on the Debt Free Wannabe board, and see if anyone can offer any suggestions?

Example thoughts ... Car insurance perhaps seems a little high - could you perhaps look into new deals for that? Do you have a mobile phone bill which could be shrunk? Would your friend be receptive to repaying a bit less every month?

Rosco32

If you car is 0% why would you want to take out a loan to pay it off that will charge you interest. I can see you want to reduce your monthly outgoing though, as would I. Have you spoken to you own bank?