Poor Credit Score - Need a Loan- Help

Anthorn

Kbk23 wrote: »

Credit unions do not look at credit scores. They process credit applications manually based on budgeting. So I would pop into local credit union and take a 3 month statement. Also, if I was you I would remove majority of you credit facilities in order to prevent slipping in again. Keep 1 credit card that has lowest interest for emergency uses. Bare in mind the maximum I've seen a credit union give out is £7500 so not sure how much they can offer.

Wrong depending on the credit union. The CU I'm a member of , Rainbow Saver Anglia, does credit search. CUs are increasingly under pressure to lend responsibly. But a CU is still a worthwhile alternative. You'll need to have income and/or benefits paid directly into the union and also expect to save as well as borrow at the same time. As a new member expect an APR of 49% rising to 60% or more.
http://www.abcul.org

National_Debtline

Hi 0Credit


Have you analysed what it is likely to cost you to rent and cover bills in a place of your own, and then factored this into your debt reduction plans? I ask because I'm assuming that the sofa-surfing lifestyle is not something you envisage as long-term.


From the list of debts you provide, it appears to me that there are only two - Vanquis and the store card - generating significant amounts of interest on a monthly basis, so there is a strong case for attacking these particular balances as hard as you can for now, taking some of the above advice on trimming living costs into account.


Dennis
@natdebtline

0Credit

National_Debtline wrote: »

Hi 0Credit


Have you analysed what it is likely to cost you to rent and cover bills in a place of your own, and then factored this into your debt reduction plans? I ask because I'm assuming that the sofa-surfing lifestyle is not something you envisage as long-term.


From the list of debts you provide, it appears to me that there are only two - Vanquis and the store card - generating significant amounts of interest on a monthly basis, so there is a strong case for attacking these particular balances as hard as you can for now, taking some of the above advice on trimming living costs into account.


Dennis
@natdebtline

Hi sorry for my delayed reply I have been afk and again just moved to a new sofa.

Yes I have and it basically will cost around £700 per month including all bills however there is about £200-300 in moving in costs.

You are correct those are the high interest dates

Vanquis: £150 payment and £118 of it is interest.
Store Card: £75 and most of that is interest.

I am going to ring all companies and reduce my monthly payments. I was trying to clear multiple debts even with little interest stupidly. I have a huge fear the high court enforcement guys turn up at my door. However I guess that is something to deal with if/when it happens.

I believe I can get my £350 of none interest monthly payments down to under £200 so that frees up the 150 to put into the high interest debts.

DCFC79

With the credit cards pay £1more than the minimum. Get rid of anything that isn't needed, look at ways you can reduce your food shopping bills.

Dobbibill

0Credit wrote: »

Hi MSE community!

So I basically need a loan to clear old existing bad debts but the problem is I have a 403 credit score due to a credit card I defaulted approx 2 years ago.

Getting a loan doesn't clear your debts, it simply moves them. Rarely a good idea unless the interest rate is substantially less and there is a lot of self discipline.

My debts:

£2400 - Vanquis credit card. Payment £150 per month - this needs to be a priority
£865 - Virgin credit card: Payment of £25 per month (this is the defaulted card and there is 0 interest)
£1350 - Store card: £84 a month payment - this also needs to be a priority
£4400 overdraft - Halifax bank sent to debt recovery - Payment of £70 per month with no interest.
£480 - NPower £50 per month - no interest
Northumbria water - £228 - £38 per month no interest
£280 - Credit Card minimum payment £5
£190 - Credit Card minimum payment £4

I also have personal debt with no interest for just under £10000. I payout approx £100 per month for these.

As you can see from the debts the interest rates are the highest in the business. This is due to them being available for bad credit score applicants so they rinse us as hard as possible.

I have applied to over 20 different loan providers and been rejected everytime. I have also used the Experian service where they match your credit with loaners however all the one with reasonable interest rates have denied me.

This was never going to be a solution anyway so they have probably done you the biggest favour.


I am working as hard as possible to up my credit score and have taken it from a mid 200's to the 400+ it is now in just over a year. The problem is if another year goes by and I have paid £2500+ more interest than I could have it will just keep holding me back from being able to say buy a home or even just be a bit less stress fee. Ideally I would get a £5000 loan to clear the high interest debts and do so in under a year.

Your credit score is only seen by you and the CRA that issues it. Any lender will score you according to their criteria.

Oh my income:

£2000 per month pre tax.

Expenses:

Debt £550
Diesel: £220
Rent: £200-500 (currently sofa hopping) - not practical long term, have you considered renting a room, maybe with bills included, rather than a flat
Food/Drink: £200
Phone: £55 - reduce this
Family: £100 (niece and mum) - stop this if poss, I'm mindful of heart over head answer you gave, although your heart is not going to pay off your debts.
Fun: £100 - stop this
Clothes: £100 - stop this
Hobbies: 100 - stop this

As you can see I am overspending as there are a few bits missed from there. I am cutting back as much as possible currently but of course the debt is really hurting my life and something I want to sort fast.

Hi 0Credit, welcome to the forum,

I have put responses in red above.

As already said by a PP, complete a SOA. This will give you a better idea as many things are missing and you have no details of the APR on the interest bearing debts.

For snowballing the debt have a look at this link If done in the right order you could save hugely on interest. Just using the 3 x £100 spends from fun, clothes and hobbies would make a big difference. Reinstate them when you have paid off the debts incurring interest. It may even help to keep you motivated.

All the best.