Large loan to clear a multitude of debt

Money1

I’m surprised no one has suggested a secured loan, obviously unsecured would be preferred but you’d have a higher chance of being accepted.

With a mortgage balance of £30k I’m guessing you probably have sufficient equity for this to be an option, with only a couple of missed payments you’re likely to get a good rate as well (5-12%). £27k shouldn’t be an issue.

The existing debt isn’t always a problem either as most secured lenders will offer the loan on the basis you say you will clear these, which unsecured don’t usually do.

Some of them will even send cheques/make balance transfers to the creditors you have debts with to ensure they’re getting paid off. It’ll have to be a joint application as well so both your incomes will be taken into account.

Your best bet is actually going through a broker, rather than direct to a lender, as they’ll be able to get the best rate based on your circumstances. Most secured lenders tend to have different criteria and it’s difficult to know where to start.

A quick google search for ‘secured loan broker’ should point you in the right direction, don’t worry too much about which company as they all tend to use the same lenders anyway. Just make sure you don’t pay an upfront fee.

Timescale usually about 3-4 weeks and don’t forget to take in the added risks of securing against your property.


Best of luck.

PeacefulWaters

Money1 wrote: »

I’m surprised no one has suggested a secured loan, obviously unsecured would be preferred but you’d have a higher chance of being accepted.

Remortgage may be better.

But I'd be very reluctant to suggest securing unsecured debts. Without controlling the spending habit it becomes a very good way to lose your home.

andyfromotley

Money1 wrote: »

I’m surprised no one has suggested a secured loan,

All in all this is terrible advice. This forum is littered with people who have done this and lost their house as a result.

Money1

andyfromotley wrote: »

All in all this is terrible advice. This forum is littered with people who have done this and lost their house as a result.

Obviously it's dependant on OP paying the loan back. But losing a house also applies to a mortgage. They asked about a loan and I gave them information about what I think would be most suitable.
I'm not going to make assumptions on their ability to repay it or not, that's their job.
I've noticed people on this forum have massive reservations about secured loans but they do serve a purpose

andyfromotley

Wasn't picking a fight.

Do you really think that swapping unsecured lending for secured would be 'most suitable'? I think its a terrible idea. There would appear to be much more suitable ways of tackling this debt, none of which risk losing the family home.

People who have racked up huge unsecured debt often go on to do the same once they have consolidated because they haven't solved the initial problem of failing to live within their means. If they consolidated their original debt in a secured loan then they are in desperate trouble.

I agree that what you suggested is a solution but i stand by my observation that, in general, its a terrible solution.

27col

Sorry. But a large loan won't clear a multitude of debt. All it will do is to transfer the multitude of debt to another lender.