I need a bad credit loan :-(

Roryboi

Hi,

I applied for a loan earlier (bad credit) i was declined due to either credit rating/score/affordability. Im just after some advice to be honest, Im applying for a loan to try and clear another loan i have had for about 6 years. This loan was in fact a loan for my ex hence the reluctance to pay it off and i did default on it for a few months till i got back on track. I now want to pay it off and clear it off my credit history but issue i am having is its around 4k. I cant afford to pay it off in 1 lump sum but can afford about 150 a month, I havent missed a payment on in in about 2-3 years. But that loan is the reason my credit rating/score is bad. I figured if i pay it off at £150 a month it would take me 3 years. The issue i have is after 3 years of paying it off my credit rating will still be poor becuase this will be showing as defaulted and wont start to disapear till its cleared. do you have any advice on anything i could do to maybe get approved for a loan or other ways?

Puzzcat

Roryboi wrote: »

Hi,

I applied for a loan earlier (bad credit) i was declined due to either credit rating/score/affordability. Im just after some advice to be honest, Im applying for a loan to try and clear another loan i have had for about 6 years. This loan was in fact a loan for my ex hence the reluctance to pay it off and i did default on it for a few months till i got back on track. I now want to pay it off and clear it off my credit history but issue i am having is its around 4k. I cant afford to pay it off in 1 lump sum but can afford about 150 a month, I havent missed a payment on in in about 2-3 years. But that loan is the reason my credit rating/score is bad. I figured if i pay it off at £150 a month it would take me 3 years. The issue i have is after 3 years of paying it off my credit rating will still be poor becuase this will be showing as defaulted and wont start to disapear till its cleared. do you have any advice on anything i could do to maybe get approved for a loan or other ways?

I believe regardless if you paid this loan off with another the default will still show on your credit file 6 years from when it defaulted.

moohound

Switching from one loan to another will make no difference to your credit report, the defaults still stand, Puzzcat is correct it will be 6 years until the defaults drop off paid off or not.

What is the interest rate on the loan?

Is the loan in joint names with your ex-partner?

sourcrates

I think what the OP is trying to say, is that if he clears the existing loan, it will show as "settled", yes the negative information will still be there, but will not be current (most lenders only look at recent credit history when making lending decisions).
The further back in your credit history the "red dots" are, the higher your theoretical credit score.


I do see your logic there OP, but you can achieve the same status by just making your existing payments to the loan ontime, after a while of making on time payments, your credit file will improve, although it wont be totally wiped clean until the 6 years are up.

[Deleted User]

Roryboi wrote: »

The issue I have is after 3 years of paying it off my credit rating will still be poor because this will be showing as defaulted and wont start to disappear till its cleared.

That's incorrect.

The default will fall off your credit file, 6 years after it was applied, not 6 years from the date the debt is cleared.

Roryboi

Ok thanks for the info guys, it's in my sole name! The usual love made me blind story lol. That makes me feel better and I now feel I can commit to paying it off. As I said before I was reluctant as I thought the default stays on until it's cleared then 6 years after that it's gone.