New Loan + New bank account = HELP!

lusitana

Hi all

I am looking for some advice. My bank emailed me saying they were upgrading my account and therefore I will be paying £16 a month for benefits I don't really use. My option is to switch to another bank. Not a problem....but....
I have a loan with my current bank as well as some credit card debt (not with the bank). Ideally I would like to consolidate my debt, including the load all into one so I only have one repayment.
I'm not sure what to do first. Do I go to an independent provider for my loan? Or do I approach a bank I want to switch to and see if they would take me as a customer and give me a loan as well?

I have checked my credit rating and it is 999 which is pretty good. I don't want to damage that rating by making a loan application that could be declined and thus giving me no money and less of a chance being accepted by the new bank. It feels a bit like a catch 22.
Can anyone advise?

Thanks

[Deleted User]

You need to separate the current account and loan and go with whoever is most appropriate for both.

Have a look at your credit files. Any missed payments, overlimits, finaincial assosicate with negatives? How much debt do you have compared to your income. This is what a lender will look at, not the fictional score.

People who want consolidation loans are generally higher risk, so you may need to judge your applications carefully.

Pixie5740

What difference does it make whether you have 1 payment or 2 coming out of your account? Answer: None.

Certainly change your current account provider if you're not happy with the current one but I really don't understand why you need/want to consolidate your existing debts. Just snowball them.

Your "credit rating" is meaningless and a waste of money. There's no such thing as a universal credit rating and the credit reference agencies don't lend money so who gives a monkeys what score they give you.

lusitana

I want to consolidate my debt because it seems that I can get a better rate on a new loan and for a shorter time. I really want to have no debt now that I have a better wage package. It's heart breaking to see my wages go into my overdraft or a credit card where it may be repaying little by little but it will take too long. Does that make sense?

DCFC79

Your credit rating of 999 means nothing, banks don't see it nor do lenders, whats important is whats on your credit files.

Pixie5740

lusitana wrote: »

I want to consolidate my debt because it seems that I can get a better rate on a new loan and for a shorter time. I really want to have no debt now that I have a better wage package. It's heart breaking to see my wages go into my overdraft or a credit card where it may be repaying little by little but it will take too long. Does that make sense?

You will still have debt though if you consolidate.

By all means take out a loan if it has a better rate than the debts you are currently repaying if you can get one. The important thing to acknowledge when consolidating is how you ended up in debt in the first place. If your overdraft and credit cards and just down to poor money management then you'll just end up using them again and be back at square one with twice as much debt as now.

dealer_wins

lusitana wrote: »

I want to consolidate my debt because it seems that I can get a better rate on a new loan and for a shorter time. I really want to have no debt now that I have a better wage package. It's heart breaking to see my wages go into my overdraft or a credit card where it may be repaying little by little but it will take too long. Does that make sense?

Overpay each month as much as you can possibly afford. This will reduce the length of your debts.

If not for you, do it for your heart's sake.

lusitana

Ok I'm not sure I get it. In all the reading I've done it's "credit rating this, credit rating that" and they say not to make too many applications as it could damage your rating and chances of being accepted.
Am I right to assume that if my credit rating is high is because my credit files are ok?
Give me any issue any day but I am not great at understanding money

Thanks for all your input so far!

Pixie5740 my debts are due to a combination of factors including that I had to invest in education that has landed me my current job and a higher rate of pay so it is what it is right now. I think I would rather pay 1 loan and see my account in the black every month than seeing it in the red until it has caught up with itself.
Does it make any sense?

Candyapple

lusitana wrote: »

Hi all

I am looking for some advice. My bank emailed me saying they were upgrading my account and therefore I will be paying £16 a month for benefits I don't really use. My option is to switch to another bank. Not a problem....but....
I have a loan with my current bank as well as some credit card debt (not with the bank). Ideally I would like to consolidate my debt, including the load all into one so I only have one repayment.
I'm not sure what to do first. Do I go to an independent provider for my loan? Or do I approach a bank I want to switch to and see if they would take me as a customer and give me a loan as well?

I have checked my credit rating and it is 999 which is pretty good. I don't want to damage that rating by making a loan application that could be declined and thus giving me no money and less of a chance being accepted by the new bank. It feels a bit like a catch 22.
Can anyone advise?

Thanks

I've never heard of a bank e-mailing such information to a customer. Are you sure the e-mail was legit?

What bank is it?

As far as I'm aware, unless the customer specifically asks to upgrade their account, the bank wouldn't just tell you that your account has been upgraded with no opt out option.

[Deleted User]

lusitana wrote: »

Am I right to assume that if my credit rating is high is because my credit files are ok?

Your credit score is high because Experian have chosen to give you a high credit score. But they don't know what you earn, what each lender is looking for and won't lend you a penny themselves.

Lenders will judge you on the basis of your credit history and income and their own criteria.

lusitana

Candyapple wrote: »

I've never heard of a bank e-mailing such information to a customer. Are you sure the e-mail was legit?

What bank is it?

As far as I'm aware, unless the customer specifically asks to upgrade their account, the bank wouldn't just tell you that your account has been upgraded with no opt out option.

It's Natwest. It is a standard email and it is from them. A couple of years ago they changed the accounts and I chose to stay with my current account because I didn't see the benefit of upgrading. It seems they are now forcing me to upgrade.