Consolidation loan with past bad credit

xsussax

Hi All


I earn about 18k pa and my partner 35k pa. Between us we have 3 credit cards, 2 catalogue accounts, a loan for our double-glazing and one for our sofas along with overdrafts in excess of £1500 each which we find impossible to get out of every month. Due to the high cost of these outgoings and interest rates, we'd like to consolidate these into a £5000 bank loan so we can get out of our o/d's, reduce our debt and be in a position to save.


What's holding me back is I have a £450 default and a £350 CCJ, both of which I settled in Feb 2011 and July 2011 respectively. My credit payments in the time preceding settling the CCJ and default have however been unremarkable. Not surprisingly, when I performed a loan soft search on Money Supermarket I wasn't offered any loans worth going for. I of course realise that my past actions have impeded my ability to access good rates on loans etc, but what I'm after is some good advice as to who/where I should go to from here - do you think it's worth going to my bank or plodding on as we are until my rating gets better?


Many thanks.

DevCoder

You can try your own bank, they would normally look at your current situation with them without doing a further credit search. (i.e. if your own accounts with them aren't in good order then it would be a refusal without leaving a credit footprint).

dealer_wins

I would advise you to post on the "debt free wannabe" board, further borrowing in your case is probably not an option, but reducing outgoings is!

Get debt free asap, and spend/enjoy the £1000s you would otherwise pay to banks in interest!!

Caz3121

you were given some good advice before https://forums.moneysavingexpert.com/discussion/4866494

DCFC79

dealer_wins wrote: »

I would advise you to post on the "debt free wannabe" board, further borrowing in your case is probably not an option, but reducing outgoings is!

Get debt free asap, and spend/enjoy the £1000s you would otherwise pay to banks in interest!!

They posted on the DFW board earlier this year DW.

OP you were advised to contact 1 of the debt charities, did you do this ?

xsussax

Gosh I remember posting that when we were raring to tackle our finances as part of a New Year plan. We got off to a good start too but then we were lumbered with a £600 MOT bill, our kitchen ceiling fell through and we had vets bills for our cat to pay. I'm sure you'll all feel the same when I say sometimes luck just isn't on your side so we've not been able to make any progress on cutting our expenditure. I know from the looks of it what we earn isn't bad at all, but my partner has to travel 80 miles a day for work so thats £300 month in fuel accounted for before we start on top of the mortgage, bills and debts. After having a good discussion and reading your comments I don't think we'll bother trying a loan now, but thanks for the advice everyone .

Gaz83

You have a joint income of £53,000. Each month you must have after-tax income of over £2,500. Unless your outgoings are sky-high, you must have at least £1,000 disposable income after rent / mortgage and bills are paid every month. Don't see why you need to take out a loan, just go all-out on snowballing the debt and it'll be paid off within six months, if not sooner.

poppasmurf_bewdley

Gaz83 wrote: »

You have a joint income of £53,000. Each month you must have after-tax income of over £2,500. Unless your outgoings are sky-high, you must have at least £1,000 disposable income after rent / mortgage and bills are paid every month. Don't see why you need to take out a loan, just go all-out on snowballing the debt and it'll be paid off within six months, if not sooner.

This was my first reaction after reading the OPs first post.

I would think the OP is overspending and needs to rein in spending for a period to get things under control.

Perhaps filling out a Income and Expediture form will give a good idea where overspending is happening.

xsussax

We earn £3338 net per month, of which we need to pay a £600 mortgage, bills, £300 petrol and nearly £500 in unsecured debt. We should technically have (after food) £600 left, which I appreciate is more than enough to save and live on. However, as I mentioned, we have had an unprecedented amount of bad luck since February and have had to fork out for a new kitchen ceiling, boiler labour, our car and vets bills for our elderly cat. We did go for a 4 night break last month with £500 spending money but we hadn't been on holiday for 3 years beforehand and we booked it a week before our boiler started leaking (which was the cause of needing a new ceiling!) otherwise we wouldn't have done it. Anyway, I've taken into account your helpful advice and we're not seeking to take out a loan for debt consolidation. Thank you all who have contributed. Sam.

BillJones

xsussax wrote: »

...as I mentioned, we have had an unprecedented amount of bad luck since February and have had to fork out for a new kitchen ceiling, boiler labour, our car and vets bills for our elderly cat.

After the event now, and so of course not much use to you at present, but did you not have insurance for any of the above?

If a foreseeable combination of these sort or events is going to cause you this much hardship, then it's a good idea to avoid the stress by insuring what you can. Vets bills, boilers, and household damage (the only reason for needing a kitchen ceiling urgently) are all insurable risks.

xsussax

We do have both pet insurance and home insurance, but the certain tests and treatment my cat needed we couldn't claim on the insurance for (teeth, annual jabs, blood tests, urine test, special food and another jab and antibiotics for a stomach bug). The home insurance, yes we had them out to assess, but we were warned our premiums would go up and it would take a while to sort so we just thought we'd pay the £500 outright and take the hit. We also need a new boiler but we're managing to keep it ticking over for now as we haven't got the £1400 needed. And then of course we're on quarterly energy bills and they always cost an arm and a leg when they come through but we're going on to monthly now though.


It just seems that every month when pay day comes along something crops up that siphons away our would-be debt tackling and savings money. I can't say other than going to Wetherspoons once or twice and using Tesco Clubcard vouchers for meals we really do anything fun with it (apart from our city break last month). It's very unnerving thinking how much goes out; we can't wait to break even. I thought a consolidation loan might be a short term solution but it would no doubt have its knock-on effects, and the banks would laugh me out of there anyway!