Chances of getting another loan

BrookesAndrew

Hi everybody,

I took out a £5000 loan at the beginning of 2014. I have got a bit of money saved up and I am going to settle the loan but I wanted to take out another £5000 loan. I rang Sainsburys bank today and they said it would be £1840 to settle the loan early.

If I settle this loan do I need to wait a few months and then apply for a new loan or is it not going to make a difference with my chances of being accepted. Just want to know if I can go ahead with applying for a new loan now or is it best I wait to get this loan settled and wait for it to appear on my credit files as being settled.

Any advise on this would be great, thank you.

[Deleted User]

Settle this one first.

AnnMollys

It’s better that you settled the previous loan first and wait for couple of months before applying for another, but see take this is a suggestion since I am not entirely sure myself, but I am just saying through common sense would be applying on this. I hope it helps.

Dobbibill

Have you spoken to Sainsburys about further borrowing?

Lenders can sometimes see the likelihood of other borrowing on internal info. I don't mean do an application, just have a casual chat to them. Did you mention your thoughts when you got the settlement figure?

Gunther_Golf

OP

Sainsburys Bank are very proactive at promoting the option of further borrowing for existing customers (i'm a former customer and got regular correspondance from them offering this service) - No harm in having a chat with them first to see if there is scope for you to obtain further borrowing of around £3200 to take your borrowed amount back to to the £5k you are looking for.

Of course if you are confident of obtaining a loan from a different lender at a more preferential APR then that might be a better option.

enthusiasticsaver

Usually it is cheaper to borrow from yourself. Is it worth holding on to the money you have and only borrow the £3k you need rather than £5k? What interest rate are you paying and what are you able to get for the new loan.

If you still think it would be better to do it the way you planned then yes paying off the existing loan first would be better before taking out another.

BrookesAndrew

Thank you all for your help. I paid the settlement figure yesterday. Do I need to wait now for the loan to appear as settled on my credit report before applying for another?