Paying off all my loans on time but my score is getting worse!! Why! Help!?

Marcio45

Like others have said... that is a debt mountain. I would consider seriously about getting further loans. That level of debt is only normal for a mortgage or a business loan, but way too high for personal spend.
I understand that two of the loans are actually for your relatives, and they probably pay for them. But it is all in your name... so they are your debt. Consider if something happens, one of you loses job or health issues, how will you pay your debt?
From a bank perspective, it is all your debt, and too high for your income. That will be reflected on your credit score (although it is worth what its worth).

Dionne88

Hi guys,

Thanks for your comments, as much as I appreciate the help what Fusionx212 said was true it just seems a little excessive on the judgemental front. Maybe I should have made it more clear, the loans I took out for my mum and my sister aren't being paid by me they both transfer the money into my account monthly and that pays for the loan. I only have about £500 worth of outgoings for myself so I am able to save a lot however both me and my partner have decided to take out a loan to pay the wedding in full as we wont have time to save before our preferred wedding date. That's what loans are for I suppose right?

Dionne88

Thanks for your advice. The loans for my sister and my mother are being paid back monthly by them. I dont actually fork out for them that would be very silly of me.

ViolaLass

Your mother and sister may be paying you for the loans but the bank will see them as loans in your name for which you are responsible.

normanna

Have you wondered what would happen if your mum or sister had to stop paying you? Could be illness, divorce, loss of job.

Don't mean to sound judgemental but I think you've been a little naive here. Helping others is scuppering your options of doing what you want with your finances. Recommend you ask them to refinance the loans in their own names now.

I second the others comments.

gingercordial

Dionne88 wrote: »

Thanks for your advice. The loans for my sister and my mother are being paid back monthly by them. I dont actually fork out for them that would be very silly of me.

Dionne, the problem is the loans are in your name and so you are responsible for them. Nobody is going to lend you another £25k when you are already in debt by £65k and you earn £36k.

Lenders won't see that your mum and sister give you the money and even if they could either or both of them could stop paying you tomorrow and walk away scot-free leaving you completely on the hook for the payments. I am not suggesting your mum or sister would do this deliberately but what if one of them lost their job or worse? It would be down to you to keep paying and therefore a lender has to look at it as if you are making the repayments yourself. Your credit score will have dropped because the debt and repayments are just too high for your salary.

To be honest it looks like your mum and sister have taken advantage of you, whether or not they meant to, because you have taken out loans yourself to fund their wedding/whatever your mum needed it for and now you will not be able to get a loan for your own wedding. You should go to them and ask them to take out loans in their own names so they can give you the money to repay the ones you took out. If they can't get the full amounts at least they could get something to bring down the amount you are personally responsible for. It is not fair to make you bear it all.

That said you don't need a £25k wedding. I say that as someone who had a £25k wedding myself! It was a fun day and a great party but the marriage only lasted five years. If I could do it again I wouldn't spend that much, it isn't worth going into debt for I promise.

Thrugelmir

Dionne88 wrote: »

Thanks for your advice. The loans for my sister and my mother are being paid back monthly by them. I dont actually fork out for them that would be very silly of me.

Why didn't they apply for the loans in their own names?

I only have about £500 worth of outgoings for myself

You don't. That's the problem. Your best option is to save for your wedding.

Ebe_Scrooge

Dionne88 wrote: »

• The first loan I had was with HSBC for £10,000 I paid it off down to £1000 and then took out another loan from them to purchase a vehicle last year. The opening balance was: £19,815 its now down to £17,124 as of April this year.
• The second loan is with Sainsbury's loans for my sisters wedding opening balance of £18,610 and is now down to £15,198 I have never missed a payment and have never had any late payments.

... I am looking for a £25,000 loan to pay for our wedding

Either this is a troll, or you need a reality check.

I'm sorry, that's not meant to be nasty, but :

You spent the thick end of £20K on a car ?
You spent £18K on your sister's wedding ?
You now want to spend £25K on your wedding ?

I'm sorry, you need a reality check. You cannot afford this lifestyle.

A good, newish car can be had for £4k or less from a reputable dealer, fully guaranteed. Sister's wedding - what ? Your wedding - well, that's up to you. Personally, my wedding cost about £1500, and everyone commented on how it was the most relaxed and fun "do" they'd ever been to. Each to their own, but a mountain of debt is not the ideal way to start married life in my opinion.

I'm not meaning to be judgemental, just my honest opinions :-)

Dionne88

Hey Guys, Thanks for everyones feedback! I took a gamble and applied for a top up loan with Sainsburys and was approved for another 30k ....I dont need 30k to pay for a wedding so I settled for the 25k which would be enough for a wedding and to pay off some other unnecessary debts.

Clearly a credit score isnt the most important I think it depends on your relationship with the lender its still possible

Thanks again

Dionne88

Also, I spoke to a few people today such as the bank and experian and they advised me that as long as I keep paying the debts off as I am monthly then my score will improve majorly. My fiancee as I said earns just as much as I do and im due a payrise in september as I accepted a promotion so my pay will rise from 36k to 58k as a head teacher.

Hopefully all these factors will grow my credit and in a few years time my credit score should be way up there