Best chance of getting a personal loan?

KTRMCR

Hello,

My girlfriend and I would like to get a loan to purchase a houseboat. We would use this as our residence. It's possible to do this by either getting a marine mortgage or a personal loan. My preferred option is to get a loan from the Cooperative as I have my other accounts with them; also, from the comparisons I have done we'd end up paying back about the same amount overall.

The other day I phoned the Coop to see if I'm eligible for one of their loans. They lend up to £25,000 and this is the amound I would need. I meet the requirements but they were asking if I would be applying for the loan in my own name or jointly with my girlfriend.

Can you advise on which situation is more likely to get approval?

I have had a current account with the Coop for about 10 years
Have never used my overdraft
Have £4000 in savings accounts with them
Have a credit card with a limit of £500 which I got from them about 10 months ago. I have paid off the bill each month.
I am employed full time. Monthly earnings around £1200 - the repayments on the loan would be £513 per month. At the moment I spend £270 on rent but this would cease if we bought the boat (don't know if bank would take this into account, as it would make the repayments more affordable?)

My girlfriend has an account with Experian. Last time she checked this (last summer) her credit rating was really bad. In the past she has had a CCJ (this is now over three years ago). However she does not have any current debts apart from student loan of around £10,000. She applied for a paid-for current account with Barclays about a year ago and was turned down, although the teller in the bank said he did not understand why. At the time she was in a low-paid job but in January started a full-time permanent job on around £26,000 p.a.

My questions are:

Would we be more likely to be approved if we applied jointly or if I applied on my own?
Would we be more likely to be approved for the loan or the marine mortgage?
Would extending the repayment period from 5 years to 7 make any difference in being approved?
Any other advice?

Thanks very much.

Caz3121

for a personal loan the norm is for debt to be up to 50% of your income so to get a £25k loan you would need income of £50k
I am assuming a marine mortgage would be secured on the boat so there maybe a better chance

KTRMCR

Caz3121 wrote: »

for a personal loan the norm is for debt to be up to 50% of your income so to get a £25k loan you would need income of £50k
I am assuming a marine mortgage would be secured on the boat so there maybe a better chance

Thanks for that. If we added our incomes together they would be around £45,000, so not too far short. I suppose the question is - is it better to (with a decent credit rating) try to go for a loan/mortgage on my own, or to increase the income I have for repayment by including my girlfriend, knowing that her credit rating is poor?

Ta

Caz3121

her bad credit rating and CCJ are going to make it very difficult - I would expect if you can get a loan it will be at a high APR as it may have to come from a sub-prime lender

Note, once you have a joint product with your partner you will then be financially associated so you may find yourself being rejected also

Apples2

Associating yourself with someone with a ccj will scupper your plans for a nautical future.

Under no circumstances should you take on any joint financial product with her, it will be a huge anchor dragging you to the sea bed.

Spending 50% of your income on debt is madness, Poseidon would be beside himself.

KTRMCR

Thanks for your help. We've both now done an experian credit report - hers shows up as fair (no mention of the CCJ so six years may have passed) and mine is good. Still though I think we're going to keep the finances separate and try to go for a marine mortgage rather than a loan.

heartbreak_star

Good luck

HBS x