Rejected for Loan to pay off expensive loan

beckfordinho

Hi All,

I recently got a loan via a website to do the house up. I was eager to get things done and just went straight to barclays and signed up to the loan without really comparing loans and not paying attention to the interest rates. I basically jumped the gun wanting the money immediateley.

I rang up Barclays to find out the outstanding amounts just out of curiosity as in 6 months I intend to begin over paying the loans and making a bulk payment towards the loan. To my horror I found out that the £10k loan i was paying back over 10 years was at 18.6% which would mean I would be paying over double the amount of the loan!

So i began looking and comparing loans in order to pay this loan off as a lot were advertised at really cheap rates as low as 4.2% M&S. However on application I have been rejected. Now I understand I may not be offered 4.2% it may be a little higher, but now I have been rejected its pointless applying for other loans.

I don't know what to do now, it makes me cringe knowing how Barclays are ripping me off with there ridiculously high interest rates. But also my stupidity not looking into this. What are my options now??? Or am I stuck in a hole and have to accept that is what I'm going to have to pay!

sourcrates

Hi, you have answered your own question really OP .
A little research beforehand may of got you a better deal, however every lenders criteria is different and you may not of been accepted at the lower rate, so you got the loan, i`m afraid you are stuck with it.

BillJones

beckfordinho wrote: »

I don't know what to do now, it makes me cringe knowing how Barclays are ripping me off with there ridiculously high interest rates. But also my stupidity not looking into this. What are my options now??? Or am I stuck in a hole and have to accept that is what I'm going to have to pay!

WHat makes you think that they are ripping you off? It's the cheapest that you've been offered.

RAS

Have you checked for early redemption penalties?

Tixy

From the sound of it your best option to reduce interest now might be to overpay it if you can afford to (double check they don't charge for overpayments).

Perhaps in say a couple of years when you have reduced the balance a bit it might be worth trying again to get another cheaper loan at that point (as obviously as that point you'll owe less and want to borrow less so should be more likely to get accepted from an affordability point of view).

That said barclays representative APR is very similar to the likes of M&S etc, so you may well have found they'd have been offering you a similar rate to barclays even if you had gone with them in the first place.

fatbelly

As he others have said, check the T&Cs on your loan.

You may be able to get some cash at low interest from credit cards

http://www.moneysavingexpert.com/loans/cut-loan-overdraft-costs

but use the pre-application checker first to avoid damaging your credit record, and do your sums because your present loan is probably the only place you are going to get a 10-year timescale.