Advice required before application

keef82

Hi all, if any of you would be so kind, I require some advice about a debt consolidation loan.
Due to a youth of nihilistic folly I find myself in close to £8000 of debt across various credit cards and bank overdrafts, some with minimal interest, one with a horrendous 39.9% APR!!!*
I am managing the debts and have not missed a payment on any of them for over 3 years but I am wasting a substantial amount of money on interest payments.
I want to get a loan to consolidate these debts but am unsure of the sort of credit rating required to secure a personal loan of £8k.
I have spent the last 3 years trying to rebuild an appalling credit rating, and I now have it up to 758. I know this is only 'fair' but from where it was its not bad going.
Now would a fair rating be sufficient to secure a loan of this size? I bank with Santander and they have some good interest rates on loans over £7500, in addition, I have just completed the repayments on a £1000 loan from Santander without missing a single payment, would this help my chances?
Would it make more sense to continue the situation as it is and try to further increase my credit rating and apply for the loan then? The reason I ask is I don't not want to apply, get declined and set my work on my credit rating back months.
Perhaps someone with more financial knowledge than me could suggest a better way to deal with this situation?
(Additional note. I earn £19000 per year)

I humbly thank you in advance.

*yes i am aware of how stupid this was!

scaredlady

Not sure you would get one. Although you say that you will use this loan to pay off all the others, the bank do not know you will. They will just see £7500 of debt, plus £7500 of another debt=£15000 of debt, nearly 100% of your annual wage.
Can you not snowball..others better than me will explain how it works, but I think you through all your money at the highest interest debt, clear that, then go down to the next one, and clear that.
probably not what you wanted to hear..sorry

Gaz83

Credit ratings are absolutely worthless. No lender will ever see the scores or ratings offered by Experian etc., and each lender lends based on their own criteria. So your 'score' of 758 isn't worth anything.

From what you say, Santander may well be your best bet - they will know your account best and know you could be trusted to pay back £1,000.

That being said, what was said in Post 2 is correct - generally, lenders will not trust that a person will use their debt consolidation loan to consolidate their debts, and so will (in your case) end up with £16,000 of debts. On a £19,000 income there's no way anyone will lend you £8,000 on top of your existing £8,000.

Speak to Santander. If they can't help, then I'm afraid snowballing will be your best bet (paying minimal payments to low APR accounts and maximal payments to high APR accounts).

bargainbetty

While echoing the snowball advice, you could speak to your bank about refinancing the highest interest debt only - just getting you away from the 39.9% rate and paying them interest instead. This might be a more palatable option for them as a lender, and would enable you to throw more at the capital sums rather than just covering interest.

Best of luck

Foxy-Stoat_3

Speak to the lender and get them to reduce the interest rate....some other clown on here reckons they spoke to a credit card company and they cut the rate in half.

thebritishbloke

Foxy-Stoat wrote: »

Speak to the lender and get them to reduce the interest rate....some other clown on here reckons they spoke to a credit card company and they cut the rate in half.

BarclayCard are known for doing this, usually only if you have dire circumstances such as a high change of income.

DCFC79

No 1 on here can tell you what credit rating will get you a loan as lenders dont even see the ratings. I agree santander will be you best bet as they know your account.

manIntheMiddle

BargainBetty and Gaz83 have given you the best advice and are spot on.