Loaning against my equity in property?!

Alanmc88

First of all, hi everyone. I'm alan and thanks for taking the time to read my post :-)... Anyway I was looking for some advice on obtaining a loan. My credit rating isn't the best but I've recently paid off my debts and been enrolled on the electoral roll etc however I've tried to get a loan and have been knocked back :-(. I was looking for 12-15k to buy a new car. I earn £560 per week and I have a 1/4 in a house that's worth 200k (I own roughly 50k) and it's mortgage free!. Would I be able to get a loan against my equity of the house since they're refusing to give me it otherwise? It just seems ridiculous that I've been giving the bank my wages every week since I was 16 and they don't trust me yet if I was a student or that they'd give me it!.. Thanks for your help guys

bigadaj

Simple, solution is to save up the money, buy soemthing cheap first and then trade up. Borrowing is going to cost you a packet, particulalry if you have a poor credit record.

If you have a poor credit record then by definition you haven't kept to previous agreements, so it's unsurprising that they're averse to lending you money.

You shouldn't be borrowing money secured on a house for a car, but they won't lend anyway as they your equity is of little use if three other people also own it. The bank couldn't get their money back if you defaulted after all.

Alanmc88

Thanks for the quick reply.. I know the simple answer would be to save however I'm a pretty impatient person lol. The previous agreement that I defaulted on was a Vodafone account that I disputed paying as it was an unfair demand!. It was only £60 or so and that's the only blemish on my record.... So you're saying I couldn't put down my 25% share on the property against a loan even if the other party's agreed? I would have no problems paying the loan back and this just seems ridiculous!

Alanmc88

The simple answer to many loans would be to "just save"...

Gaz83

Put it quite simply, many banks think a loan of £15k for a car is very extravagant for anyone but those with a flawless credit history.

Alanmc88

At the end if the day, a loan is a loan. Doesn't matter if it's for a car, a new kitchen or a new parachute. You're still borrowing the money. i could see point if it was just the average joe walking into the branch and asking for money but I have capital to loan against if things should hit the fan

Alanmc88

And getting the permission from the other shareholders won't be a problem

jonesMUFCforever

Look at it from a lender's point of view - how could they sell a property that you only own 25% of should you default.
Have you thought about asking the other 3 parties to see if they would be willing to buy your stake?

Gaz83

Alanmc88 wrote: »

At the end if the day, a loan is a loan. Doesn't matter if it's for a car, a new kitchen or a new parachute. You're still borrowing the money. i could see point if it was just the average joe walking into the branch and asking for money but I have capital to loan against if things should hit the fan

Well, no, a loan isn't a loan. If what you are saying is true then it wouldn't make any difference to whether I want to borrow £15k to build a garage or £15k to take my mates to Vegas. Of course it's different.

You have capital tied up in a shared ownership scheme. It's not the easiest thing for a bank to release that capital should the loan go pear-shaped.

Thrugelmir

Alanmc88 wrote: »

It was only £60 or so and that's the only blemish on my record....

........and so a lender isn't going to risk advancing thousands. A credit record speaks a thousand words about an individual and their attitude towards their personal finances.

Alanmc88

So to put things simple then it's not possible use my share of equity to secure a loan. That's all I wanted to know. Thanks for the replies guys ;-)