Personal loans/secured loans

Jd2015

lol yes it was step change.

bargainbetty

Are all your debts on cards or on loans?


If you have cards, you may be able to obtain a small loan to pay off the highest interest card at a better rate. You could then move balances from one high-rate card to the empty one that may offer a decent balance transfer rate) and repeat this to get all the debts on lower rates, if nothing else. Your interest payments will be lower as a result, so more of your cash goes to the actual debts.


Be careful though, as lots of recent searches on your history might look a tad desperate to lenders.

Jd2015

Hi betty

All are credit cards and one Very account. Yeah the whole idea about getting the consolidating loan is to reduce the interest rate. Was hoping to do it on one big loan but as you say I may have to use smaller loans alternatively I might go down the secured lending route (although that one worries me and would need a lot of research).

financegeek

If you're interested in pursuing the secured loan option I'd maybe try another broker. for a LTV of 65% rates should start from 4 - 5%.

to be quoted a rate of 15% would either mean there'd been recent serious adverse, or that the affordability still isn't there, even with all credit being cleared.

Jd2015

Ok so I went through Nationwide's no obligation personal loan quote service on Saturday and was quoted a rate of 13.3% for a 25k loan. From what I read if you are quoted 20% or above a decline is very likely when you go throught the full application. Based on that I went through with the application and all got approved and funds will be released to me in next 3-5 days.

Quite surprised I got approved but it will make us about £410 per month better off which should allow us to overpay etc and tackle our debts more aggressively.

Spoke to another secured lender broker and without going through full application process said secured loans are all around the 10% apr mark - I assume everyone agrees I'm better off with the slightly higher apr offered by nationwide on the unsecured loan due the risk of secured loan and the higher fees they add on to the loan?

The Nationwide loan is 7 years so my target is debt free (excl the mortgage) in 5 years!!! Such a relief to think I can stop treading water with my debts and start making a real dent in them!

Thanks for everyones help!

Tiddlywinks

Jd2015 wrote: »

Ok so I went through Nationwide's no obligation personal loan quote service on Saturday and was quoted a rate of 13.3% for a 25k loan. From what I read if you are quoted 20% or above a decline is very likely when you go throught the full application. Based on that I went through with the application and all got approved and funds will be released to me in next 3-5 days.

Quite surprised I got approved but it will make us about £410 per month better off which should allow us to overpay etc and tackle our debts more aggressively.

Spoke to another secured lender broker and without going through full application process said secured loans are all around the 10% apr mark - I assume everyone agrees I'm better off with the slightly higher apr offered by nationwide on the unsecured loan due the risk of secured loan and the higher fees they add on to the loan?

The Nationwide loan is 7 years so my target is debt free (excl the mortgage) in 5 years!!! Such a relief to think I can stop treading water with my debts and start making a real dent in them!

Thanks for everyones help!

So, if you can afford £400 extra per month, why take a loan over 7 years with all the extra interest that entails.

Why not a shorter term?

Jd2015

You have misread my post. I did not say I could afford to overpay £400 extra per month, I said we will be £400 better off per month which should allow us to overpay. They aren't the same thing.

Basically I took the longer term to improve our cash flow primarily and to reduce the risk of having to fall back on credit cards going forward which has been our fault in the past. Yes I probably could have taken a shorter term but would have had to plan my budget a lot tighter which naturally carries more risk of being overspent.

Make sense? :money:

MallyGirl

Jd2015 wrote: »

Ok so I went through Nationwide's no obligation personal loan quote service on Saturday and was quoted a rate of 13.3% for a 25k loan. From what I read if you are quoted 20% or above a decline is very likely when you go throught the full application. Based on that I went through with the application and all got approved and funds will be released to me in next 3-5 days.

I would now spend the time till you get the money making sure you have all the debts and APRs to hand. As soon as the money is in your account pay off every card, and definitely the Very account, and close all bar one CC down once cleared.
I would keep one CC - preferably a mainstream one that you have had for a decent length of time - for emergencies only.
And do not apply for any more cards or credit accounts. You have been given a chance to get everything on an even keel so go for it.
Good luck

Jd2015

Thanks mally. Every single penny of the loan is paying off the debt. The last 12 months have been pretty stressful and it's such a weight off my shoulders to think that I have a genuine and realistic plan to clear all my debts. Part of me is really looking forward to it.

kanavsingh

Don't be in Debt. Before making any new loan decisions, Try to pay back as soon as possible or else you will face financial losses