Loan / credit consolidation help

WAYNE1

Hi,
Can you please help ?
On my mortgage from Alliance & Leicester in 2008 there was a loan part-£18k.
Now I have took my mortgage elsewhere I have a unsecured loan amount £99 per month. 7.9% for period of mortgage !

I also have a credit card £3000 with Santander, interest free only until 31st May '15.

I'm thinking of consoldating loan / credit together to clear debts / pay less interest.

Is this a good idea to do or is another way to clear these debts ?
Any help much appreciated.

Thanks

Wayne

CLAPTON

so you have unsecured debts of 21,000

presumably you have a very good income and an excellent credit history

if you can get an APR for less than 7.9% AND you can afford much higher monthly payments then it may be a good idea

what is your income
how much can you afford to pay each month
what do your credit record say

why didn't you refinance the loan into your mortgage when you transferred it?

ReadingTim

Even if you could get one, consolidation loans don't always work because borrowers don't close the account they're initially trying to consolidate and end up doubling their debt rather than consolidating it. Can you (realistically) resist that temptation? Many on here can't/didn't.

But fundamentally, you can't borrow your way out of debt, so concentrate on repaying the existing loans, ie spend less than you earn!

CLAPTON

ReadingTim wrote: »

Even if you could get one, consolidation loans don't always work because borrowers don't close the account they're initially trying to consolidate and end up doubling their debt rather than consolidating it. Can you (realistically) resist that temptation? Many on here can't/didn't.

But fundamentally, you can't borrow your way out of debt, so concentrate on repaying the existing loans, ie spend less than you earn!

given an option of reducing your interest rate by refinancing, you personally would choose to pay higher interest for this somewhat strange principle?

ReadingTim

CLAPTON wrote: »

given an option of reducing your interest rate by refinancing, you personally would choose to pay higher interest for this somewhat strange principle?

Personally, my strange principle is to live within my means, but that's just me.

My comment was aimed at those who believe they can borrow their way out of debt, ie they're repay a loan by taking out a loan. Many do, as this board proves on a daily basis. Even if the OP gets this, and is simply doing it to minimise the interest, many others also fall into the trap of spending both loans, doubling their debt. Again, as this board (and the debt free wannabe board) prove on a daily basis.

Reducing the rate of interest alone isn't going to clear debts of £21k

CLAPTON

ReadingTim wrote: »

Personally, my strange principle is to live within my means, but that's just me.

My comment was aimed at those who believe they can borrow their way out of debt, ie they're repay a loan by taking out a loan. Many do, as this board proves on a daily basis. Even if the OP gets this, and is simply doing it to minimise the interest, many others also fall into the trap of spending both loans, doubling their debt. Again, as this board (and the debt free wannabe board) prove on a daily basis.

Reducing the rate of interest alone isn't going to clear debts of £21k

It is clearly sensible and rational to fund a debt with the lowest interest.

If there is the opportunity to transfer a debt from a high interest rate to a low interest rate then it is sensible to recommend such a course of action.

The parrot fashion repetition 'don't reduce the interest on your loan advice' ill serves the people asking for guidance.

Of course, it's perfectly sensible to emphasis the need to reduce the overall level of debt and not to increase it.

idunknow

given an option of reducing your interest rate by refinancing, you personally would choose to pay higher interest for this somewhat strange principle?

andyfromotley

Bt as much as you can to another 0% card, that is the cheapest way currently of repaying your debt. Switching debt from 0% to a consolidation loan is not the best way to deal with it.