Husband and wife personal loans

Dekazer

Afternoon all, I would be grateful for your thoughts on our situation.

We (myself and my husband) earn just under £40k each. We currently have no credit card debt, but a joint available balance (on one card each) of around £11.5k. I am finishing off paying a personal loan of £22k, due to finish in April 2014. We have no mortgage, and our monthly outgoings are less than £900 between us per month.

We want to buy a boat - its current asking price is £58,000, but of course we intend to negotiate! We would prefer to pay for it using unsecured personal loans rather than a marine mortgage, if possible. Our savings aren't enough to allow us to borrow the amount we need on just one personal loan. Neither of us has any obvious black marks on our credit files, neither has ever been refused credit, all good there.

Assuming I pay off my current loan a bit early, so that's gone, how should we apply for our personal loans?

1. Both at the same time on the same day, in the hope that our credit searches don't show up on each other's check.

2. One before the other, so that we know of any shortfall, but accepting that my husband's loan application might show up on my credit check.

Finally, is there any chance that there's another way of borrowing £50k between us??

Thank you in advance for your comments,

Dekazer

somethingcorporate

It's very unlikely you'd get that amount of unsecured lending on your salaries. As a rule of thumb you can borrow circa 50% of your annual income.

The easiest way would probably be a mortgage against your property although obviously this would be secured.

CLAPTON

one would have presumed you would go for the loan with the lowest interest rate?

Dekazer

Thank you for comments so far!

In 2009, when I was earning a fair amount less, I was pre-approved for a £22k unsecured personal loan without even asking - have things got that much worse?

We have very low outgoings because we currently live on a boat and only pay £500 a month costs, so we have around £3.1k disposable income every month. I suppose if they turn us down they turn us down, we'd just have to save the whole amount, but I'd appreciate opinions as to whether we should apply simultaneously or staggered...

And, yes, we will be applying for the lowest rates we think we can get. I suppose applying for the least likely to succeed loan first is the best approach, if we stagger it.

Tixy

Are you financially associated on your credit files? you don't mention any joint accounts at all?

If you are not shown as financial associates then when you each apply for loans won't impact on the other.

How much are you each hoping to borrow? the whole £58k between you or do you have some savings towards it. Unsecured loans over £25k are usually quite a bit harder to get than loans up to that amount (although obviously even for loans under that amount you need to pass their perceived affordability calcs).

Dekazer

I think we would be financially associated (I have copies of our credit files from a while ago, but not in front of me right now). We are at the same address and have one joint current account.

I'm not sure how much we'd each want to borrow, but probably over £20k each, up to £25k each.

BrassicWoman

What were you thinking of putting as the reason for the loan? If it isn't "boat" it's fraud...

Tixy

The joint current account would likely mean you are financially associated.

That said with a financial associate they are usually looking for missed payments/signs of financial distress/insolvency etc when they view the other person's file.
For the loan affordability for each of you they will only consider your own earnings so if they see a recent credit search on the other's file it shouldn't be a major flag.

I'd apply close together (i.e. before the new credit account has time to appear on the other's file - which typically takes a couple of weeks or more) but not try to time it to the same second.

In terms of affordability - in the current climate usually people find it harder to borrow more than half their gross salary. It sounds like you are probably borderline in terms of perceived affordability (as they likely won't take in to account your relatively low living costs).

Dekazer

BrassicWoman wrote: »

What were you thinking of putting as the reason for the loan? If it isn't "boat" it's fraud...

I'm not sure what it was, in my posts, that warranted this reply. I have never made a fraudulent claim or application and don't intend to start now. When I make my application I will answer the questions honestly. It worked last time I borrowed money to buy a boat after all.

Thanks for all your constructive comments

Thrugelmir

Dekazer wrote: »

In 2009, when I was earning a fair amount less, I was pre-approved for a £22k unsecured personal loan without even asking - have things got that much worse?

The world is a far different place.

£58k unsecured is a totally different proposition to £22k.

Nothing to stop you sailing off over the horizon.....;)

bigadaj

Thrugelmir wrote: »

The world is a far different place.

£58k unsecured is a totally different proposition to £22k.

Nothing to stop you sailing off over the horizon.....;)

Is it really a differnt place, 2009 is post gfc.

I'm not disputing that the difference in loan values is significant and that amount of unsecured credit is unlikely.

OP - You say you have no mortgage but do you own a house, if so then looking at a mortgage might be the only feasible option I could think of, as interest rates would be lower though you'd want to pay over a relatively short time frame which means slightly higher interst rates with no early repayment penalties.