Go into Bank Branch to Ask for Loan?

jimbojambo1234

My income is around £21,000 a year but as someone that is self employed that can fluctuate either up or down.

I'm paying the minimum or the cards at the moment which is about £50.

CLAPTON

jimbojambo1234 wrote: »

My income is around £21,000 a year but as someone that is self employed that can fluctuate either up or down.

I'm paying the minimum or the cards at the moment which is about £50.

you currently have debt of 5,300 and are asking for 7,500
so a lender will see your debt as 12,800
they will see you only pay the minimum each month

with an income (especially self employed) of only 21,000 then most (all) lenders will see debts of 12,800 as excessive.

fozmcfc

Your situation was similar to mine, debt on credit cards, turned down for a consolidation loan and had quite a bit of debt, compared to my salary.

I did on the other hand, have a decent, credit record as I was up to date with payments.

Being self-employed, means not a guaranteed income and that could be a problem and is the only real difference between you and the situation, I was in above.

I didn't think, I would be able to get a 0% credit card to transfer debt to, after the loan refusal, but was accepted by Virgin with a 6k limit, which enabled me to move my credit card debt over to it.

So as none of your credit cards are issued by MBNA either directly or under a different name such as Virgin, Creation etc, if you are going to apply for a 0% card, it would be an MBNA backed card, I would try for.

If accepted, you could at least transfer some of the other cards debt to it. You might be even surprised, like I was with getting accepted and the limit.

Reading the guides, I remember reading that Virgin and MBNA cards are more difficult to get than say Creation card or Fluid card which are still an MBNA cards, but lend to those in the good-very good bracket, rather than very good-excellent bracket.

Try the eligibility checker for instance on the Fluid credit card site and see what it comes back with.

Herzlos

I wouldn't take out a consolidation loan for more than you need, as you'll just end off further in debt. I'd also try and avoid taking out a loan whilst most of your debt is on a 0% deal, as your cost is going to go up.

Focus on paying down the Barclaycard you're paying interest on, and then in 6 months look at getting a loan to cover what's left on all 3 cards just before you start paying interest on the other 2. The 6 months extra history and the reduced Barclaycard balance might make it more likely, even if you've only knocked £1000 off the total.

jimbojambo1234

Thanks for that, fozmcfc, I tried the Fluid eligibility checker and it said that I wasn't eligible for their one unfortunately. It said I was "excellent" eligibility for Barclaycard (already have one though), Capital One and "Good" eligibility for Halifax, Bank of Scotland and Lloyds.

The MSE eligibility checkers says that I have 50% for Post Office and 40% for Halifax, Virgin, MBNA, Bank of Scotland and Lloyds. Is it worth considering applying those that I have 50% or 40% chance for?

Thanks to everyone else for their replies so far

Tixy

Can you only afford the minimum currently?

In your position I would spend the next 4-6months paying as much as you can afford off the cards (most of it to the one charging interest and just over the minimum to the other cards).

Then you could try applying again for a smaller loan (for the amount your debts are at that point).

jimbojambo1234

I will need to check my finances again but up to now have only been able to pay the minimum. I will have to take a look and try to pay off more of that credit card that I'm paying the interest on which, along with reducing the actual debt, will reduce the interest I'm paying on it, of course.

-taff

jimbojambo1234 wrote: »

I was thinking of going for £7,500 as that is when the interest rate
seems to go from around 7/8% down to 4.3%. I was thinking that
the extra cash (on top of what I would use to pay off the credit card debt) would be there in case of cash flow problems.

That is why consolidation loans never work.
You borrow more than you actually owe, then end up paying more back.
If you can't guaranteepaying off your debts now at a minimum each month, all you're doing by consolidatiing is taking out a bigger debt over a longer period.
That, unless you cut up all your cards, and don't have another one, and cancel your overdraft, is why people [myself included] run up bigger debts again, because you start spending on your CCs because you've got a little bit of extra cash from borrowing more.

If you moved out of the office you were paying 200 for, can you not use this against the higher interest card?
Can you move some that debt now to the 0% card?

Pixie5740

Are you a home owner? I'm self employed and because I'm not a home owner that automatically discounts me from a number of high street lenders no matter what shape my credit file is in.

Borrowing more money than you need for a rainy day isn't very sensible. What's the point on paying interest on money you don't have to borrow?

Either try snowballing your debt or switching your credit card debt to a card with 0% balance transfer.

fwor

jimbojambo1234 wrote: »

and I would have money for a rainy day

Just to pick up on this aspect of the loan: borrowing more money than you need should never be thought of as "having money for a rainy day" - because it's not your money.

This is the pattern of thinking that causes people to "consolidate" and turn a £5.3k debt into a £7.5k debt (and then a £10k debt and then £15k, and so on).