Loan for House Extension

Mr&MrsChappers

We are looking to extend our home due to family size increasing and are looking for an unsecured loan of 30,000 to 35,000 pounds over 5 years. I have looked at some sites such as Sainsburies and they are offering an APR of 6.8% over 60 months for the value I am looking at which has repayments of 500-600 a month which are affordable. I was wondering if there is any better way to borrow this amount of money than the standard goto a bank route. I have a good / excellent credit score I believe with no missed payments or CCJ's etc. (just an overdraft I have not managed to get rid of)

Can anyone out there help??......

[Deleted User]

[STRIKE]You won't get an unsecured loan over 25k[/STRIKE]. edit - Sainsburys offer loans to 35k - that's inflation for you.

You also won't repay a loan of 30k with £500 a month over 5 years unless its interest free.

Living in your overdraft will make you look a little risky to lenders. You may want to sort that out before you apply. Although if you have a spare £500-600 a month, why do you have an overdraft?

Mr&MrsChappers

The amount was £598 a month for 30k and the overdraft is an legacy.

Other than that I assume you have no better ideas than what I have already.

TadleyBaggie

Deleted_User wrote: »

You won't get an unsecured loan over 25k.

Seems Sainsburys will lend up to 35K as a personal loan according to their website: https://www.sainsburysbank.co.uk/borrowing/bor_borrowing_zone.shtml

Mr&MrsChappers

exactly I saw that as well, it means a short term loan over a short period which is what I am after.

If looks like this is the best decision / only option. I would prefer not to have a secured loan if at all possible. I have a fixed rate mortgage that ends in 5 yrs time hence looking to coincide the end dates thus increasing the LTV ratio for my next mortgage and getting a better deal in terms of %age rates. It also means that if the rates increase during the next 5 years I will have the spare monthly amounts to pay for any increases due to the loan being paid off.

To add to the reasons re my overdraft. Thats a legacy from when I was single and I have not paid it off due to paying for an wedding last year which I hasten to add we saved up for and paid for (no loans where taken to pay for it)

[Deleted User]

The rate on the Sainsbury's loan is much higher on 35k than lower amounts.

You could consider two separate smaller loans for potentially lower rates, although you run the risk of getting one but not the other.

burlington6

If you can afford the repayments how much have you already saved with this surplus income?

Mr&MrsChappers

zx81 Thank you for your suggestion..

Mr&MrsChappers

Burlington- I paid for a Wedding!! but in answer to your question about 10k......

catwoman73

I wouldn't bank on getting the headline rate from Sainsbury's. There's a lot of people with good incomes and perfect credit ratings that didn't, myself included.

They offered me 9.3%, which I thought was too expensive. I then applied to my own bank (Santander) and got 3.9%.

Mr&MrsChappers

I am getting that impression so may split it in 2 between me and the good lady wife and go with our current Bank (Natwest) works out a little cheaper but not as low as 3.9.

(Though the current bank may be a bit miffed we just moved our mortgage from them to another lender which has saved us a lot of money)