Consolidation & credit rating ?

jonesMUFCforever

Kev64 wrote: »

Ok, Ill try writing to A&L to see if they will reverse the decision.... meantime, can anyone tell me why Lloyds are advertising loans at 8.9% on the front page of their website, yet when I go to apply online (I bank with them), the rate shown suddenly appears at 14.4% !! ???

Surely my own bank isn't doing an instant credit score on me before I actually click on the 'Apply' button ?

Also, my wife's past finances have been pretty poor, but we've always endeavoured to keep things separate so that her score doesn't affect mine. We did have a joint loan many years ago, before we were married, that she had problems repaying. How long will the credit reference agencies hold that against me ? - and is there any way of finding out if our records are still linked ?

How much did you want to borrow and over how long?

To get the best rates you have to borrow £7.5k or more and have an A1 credit score.
Can you honestly say that this is the case in this matter?
The bank has a monthly score of between 1 and 9 (1 being best 9 - they won't want to know!)on your account.
Any public information about your credit history ie defaults or CCJ will be worked into your score.
It also works out how you have run your account - ie any excesses will effect the score or missed payments on loans and credit cards.

You might get a better offer if you make an appointment to see someone in branch. They have the option of phoning a retention unit to get better rate rather than lose the loan to a competitor.

This will only work with an A1 credit rating - only you know if you are whiter than white or not.

I also agree with inmypocketnottheirs a consolidation loan will only work if you have worked out why you are £16k in debt and what steps you now take to make sure that you are not in the same boat 12 months down the line.

inmypocketnottheirs

Kev64 wrote: »

Why ? If I'm being charged double the interest rate on the credit cards than I would be on a consolidation loan, why is it an 'expensive way' ?

For example 19.9% over 5 years is cheaper than 10% over 25 years. Why not just take a look at other methods?

Kev64

Yes, but 10% over five years is cheaper than 19.9% over five years. My plan is to leave the 3k I have on the M&S card at 3.9% for life and hopefully consolidate the rest into a loan at significantly lower interest than I'm paying now, keep the total repayments about the same - which equates to a loan period of four or five years. Chop up the cards & close the accounts. I end up debt free in four to five years and it costs me a lot less than just staying where I am. I can only repay what I can afford to repay - which is about £420 per month. I'm not stupid enough to borrow more than I need to clear the debt, or extend the loan period so I end up with lower payments in the short term but end up paying lots more in the long term.

My goal is to get out of debt as quickly and cheaply as I can.

nomoneytoday

Kev64 wrote: »

My goal is to get out of debt as quickly and cheaply as I can.

Good for you !!

In answer to your original question, some lenders look on consolidation loans less favourably as if you don't pay off the original debt of £16k, all of a sudden you may owe over £30k.. :eek:

inmypocketnottheirs

Kev64 wrote: »

Yes, but 10% over five years is cheaper than 19.9% over five years. My plan is to leave the 3k I have on the M&S card at 3.9% for life and hopefully consolidate the rest into a loan at significantly lower interest than I'm paying now, keep the total repayments about the same - which equates to a loan period of four or five years. Chop up the cards & close the accounts. I end up debt free in four to five years and it costs me a lot less than just staying where I am. I can only repay what I can afford to repay - which is about £420 per month. I'm not stupid enough to borrow more than I need to clear the debt, or extend the loan period so I end up with lower payments in the short term but end up paying lots more in the long term.

My goal is to get out of debt as quickly and cheaply as I can.

OK so don't look at another way.

Please accept my sincere apologies. I was only trying to help.