Personal Loan and Working for a Bank

pinkness86

Hi Everyone,

I'm in a really difficult situation and i just wondered if someone can give me some advice.

I have worked for a bank for 10 years this year. A few years after joining i stupidly stopped paying a few debts and i defaulted on them. These have been on my credit file ever since and have prevented me from obtaining any decent credit. Over a period of 7 years i have got myself into a huge mess and now have debts totaling around £20k. This consists of a few high interest loans and credit cards.

I contacted experian recently and they have informed me that my last default drops off my file in November this year. I am then planning on booking an appointment at my local branch and applying for a staff loan which will be for debt consolidation only. I know this is more debt, however it will be a much lower interest rate and i will just have one payment each month.

Has anyone here worked for a bank and had a problem like this? I'm hoping that if the loan gets declined that they will still consider me as i'm in financial difficulty. If it does get declined then i will have to go down the IVA/Debt Management Plan route, but i'm worried i will lose my job if i enter into any of these. I don't work as a financial advisor i just have an office job but it still worries me. Any help and advice would be greatly appreciated.

DCFC79

Has the root cause of the debts been resolved ? If not whats to stop it coming back.

How do you know it will be a lower interest rate ?

Do you have a budget and stick to it ?

Id consider posting on the dfw board.

pinkness86

DCFC79 wrote: »

Has the root cause of the debts been resolved ? If not whats to stop it coming back.

How do you know it will be a lower interest rate ?

Do you have a budget and stick to it ?

Id consider posting on the dfw board.

I have just taken out debt and then tried to consolidate it and it has just built up more and more as i have stupidly taken out more debt. I have learnt my lesson and now i'm older i am definatley wiser. I just want it all in one loan without it seriously affecting my credit score for the next six years.

It will be a staff loan so i get a staff rate which is around 8%.

I have been on a budget for a long time now. It's very difficult at times though as i don't have much left each month after i've paid everything out.

jonesMUFCforever

The staff loan also means beneficial loans tax.
You need to work this out calculating the interest on the loan for 12 months minus the HMRC 's official rate (I think its 3% at present).
You will get taxed at 20% on the difference.
This is normally done through your tax code so your take home may reduce from next year onwards.

Be careful these days any excuse for getting rid of staff they wil take.

Nearlyold

The staff loan also means beneficial loans tax.
You need to work this out calculating the interest on the loan for 12 months minus the HMRC 's official rate (I think its 3% at present).
You will get taxed at 20% on the difference.
This is normally done through your tax code so your take home may reduce from next year onwards.

You don't deduct the HMRC official rate from the staff rate - its the other way round - other wise the higher the rate the bank were charging the more tax you'd pay - which would be a bit bizarre. The OP mentions being charged 8% in which case there will be no tax to pay as that rate is higher than the HMRC official rate.

pinkness86

Sorry but i'm really confused with all this HMRC stuff. As far as i'm aware it's just the same as a normal personal loan but we get offered a preferential rate as we are staff.

PeacefulWaters

pinkness86 wrote: »

Sorry but i'm really confused with all this HMRC stuff. As far as i'm aware it's just the same as a normal personal loan but we get offered a preferential rate as we are staff.

It's only an issue if your preferential rate is below 3.5%.

enthusiasticsaver

Many people have gone down the debt consolidation route and it almost never works out. You said you have done it before and it hasn't worked. Why would it work now when you will also have an extra loan payment?

Pixie5740

8% isn't a particularly good rate and I'll never understand the fascination with only having a single monthly payment to make that everyone who posts about consolidation has.

Have you tied plugging the numbers into a snowball calculator to find out if snowballing is less expensive than consolidating?

You've said that you've made a budget and been sticking to it. During that time has your debt increased or decreased? Perhaps you could post your Statement of Affairs on the Debt Free Wannabe board for ideas on how to improve your budget.

http://www.stoozing.com/calculator/soa.php

I do know someone who worked at a bank and had an IVA. That was around 12 years ago though. An IVA is a formal agreement which means you are insolvent wheras a Debt Management Plan is an informal agreement between you and your creditors. Is there anyone you can talk to in confidence where you work or does the staff handbook say anything about debt or insolvency?

mcpitman

jonesMUFCforever wrote: »

Be careful these days any excuse for getting rid of staff they wil take.

Sweeping statement alert!

Candyapple

pinkness86 wrote: »

Hi Everyone,

I'm in a really difficult situation and i just wondered if someone can give me some advice.

I have worked for a bank for 10 years this year. A few years after joining i stupidly stopped paying a few debts and i defaulted on them. These have been on my credit file ever since and have prevented me from obtaining any decent credit. Over a period of 7 years i have got myself into a huge mess and now have debts totaling around £20k. This consists of a few high interest loans and credit cards.

First of all, you need to check all 3 credit reference agencies because the data may be different on each.

The free versions to check your credit files are below:
Experian: https://www.moneysavingexpert.com/creditclub
Equifax: https://www.clearscore.com
Call Credit: https://www.noddle.co.uk

Please answer all questions below and then we can offer further advice.

1. How many defaults in total do you have and what are the dates of the them?

2. Please list all credit card limits along with any outstanding balances and also the names of the card providers.

3. Same goes for above but this time with any loans / car finance etc.

4. Do you have any late payment markers / CCJs?

5. Are you on the electoral roll (does it show on all 3 files?)

6. Do you have any other closed / settled accounts in your history?

7. Do you have many other 'credit' accounts showing on your files such as bank account / mobile phone etc.?

8. Have you made any credit applications in the last 12 months?

9. What is your annual salary?

10. What is the likely APR you would get for a staff loan? Is there a maximum amount you can apply for? And for how many years will you be wanting to pay it off?