Should we apply for a loan?

Katie-Jane

Hi All,

I'm after a bit of advice.
My husband and I have got equal amounts of debt , and we're wondering whats the best way to clear it quickly.
We both have personal loans; mine has £8k left and his has £4k. He also has a credit card with £3k on.
My current loan doesn't really allow me to make over-payments, however I can settle it at any time with no early repayment charges. If I settled the loan now I would save around £400 interest. My husband would also save a little in interest if he settled his now.
We have both recently applied for 0% interest credit cards, in the hope we can shift our loans onto them. However the limits we were offered weren't high enough to do this.

We are now thinking we want all our debt in one place, with the flexibility to make over-payments whenever we like.
I've found a Sainsbury's loan that says we can borrow £15k over 18 months at 2.9% APR. This is really affordable for us.
Do loan companies know that we will be using it to pay off all the other debt or do they assume this is in addition, thus thinking we cannot afford that? Also as we have recently applied for credit cards are we likely to be accepted with such a good APR? Should we wait a few months? Or just go for it?

Thanks,

[Deleted User]

They'll assume it's additional.

From what you've said, it would be a stretch for you to be accepted at 2.9%.

Presumably you transferred what you could to the 0% money transfer cards?

Katie-Jane

Deleted_User wrote: »

They'll assume it's additional.

From what you've said, it would be a stretch for you to be accepted at 2.9%.

Presumably you transferred what you could to the 0% money transfer cards?

Thanks for replying.

When I had a look at the application I clicked 'debt consolidation' as the reason and then it asked for a list of our debts? So maybe Sainsbury's do realise we wouldn't be paying for this in addition?

We only managed to get a £4000 credit limit on the money transfer card, and I was really hoping for all debt to be in one place.. :huh:

Just not sure what to do for the best? If I apply for the loan and don't like the APR they offer can I turn it down without it leaving a footprint on my history?

[Deleted User]

Take the 4k card and transfer what you can. This will give you a significant saving. It's mad to aim for a single payment rather than financial wealth.

All lenders will assume you will spend the additional credit as well as your existing loan.

Any application will leave a search on your files.