Debt Consolidation - home Equity & poor credit rating

Weddingwishes89

We bought a house 2 years ago for £105k - we only owe £88k
And know it is worth at least £126k as we unfortunatly
Got ourselves into debt as it needed total renovation.
We don’t really have much debt, one loan - Very account,
And an old loan for £1000.
We have no CCJ’s - a default which was settled immediately
But due to late payments our credit scores are now very poor.
We always pay, but not always on time!
Yorkshire bank said they can offer us 1.59% and an equity loan of 10k subject to checks etc, she said if the interest rates are
Higher than what we can get then she couldn’t see why we
Wouldn’t be accepted.
We have never missed or late paid a mortgage payment, and surely they can see the interest rates are causing us the hassle.
I wondered if anyone knew the likelyness of us being accepted
And if anyone had a similar story? I don’t want to get my hopes up
And then be stuck struggling again. 😕

DCFC79

Weddingwishes89 wrote: »

We bought a house 2 years ago for £105k - we only owe £88k
And know it is worth at least £126k as we unfortunatly
Got ourselves into debt as it needed total renovation.
We don’t really have much debt, one loan - Very account,
And an old loan for £1000.
We have no CCJ’s - a default which was settled immediately
But due to late payments our credit scores are now very poor.
We always pay, but not always on time!
Yorkshire bank said they can offer us 1.59% and an equity loan of 10k subject to checks etc, she said if the interest rates are
Higher than what we can get then she couldn’t see why we
Wouldn’t be accepted.
We have never missed or late paid a mortgage payment, and surely they can see the interest rates are causing us the hassle.
I wondered if anyone knew the likelyness of us being accepted
And if anyone had a similar story? I don’t want to get my hopes up
And then be stuck struggling again. ��

1 your credit score is neither here nor there, your credit history is what matters.

2 Consolidation rarely works, you need to have will power to not get yourself into the same position which means no unnecessary spending, can you do that ?

3 No 1 here will know your chances and at a guess other peoples circumstances will be different so can't use other peoples experiences as a guide.

I'm struggling to see what the issue is, why can't you save up what you need to get done ?

Prioritise the work that needs doing, pay things on time. Maybe you need to cut on your spending so you have extra capital for the work.

Weddingwishes89

No we didn’t realise we could have got more money when we bought the house, as first time buyers we didn’t realise the house was a total wreck so we got a loan and paid bits and bobs which spiralled into unmanageable monthly payments - we have poor credit scores so we couldn’t get into debt if we wanted to anyway. We just saw this as an opertunity to get rid of the excess payments and pay our mortgage off quicker whilst easing the pressure for building our credit scores back up...does that make more sense?

[Deleted User]

Again, ignore the credit scores.

The hard truth is people who need to consolidate will rarely be able to do so at a low rate.

Dobbibill

Weddingwishes89 wrote: »

Got ourselves into debt as it needed total renovation.
We don’t really have much debt, one loan - Very account,
And an old loan for £1000.

Hi Weddingwishes - welcome to the forum.

How much debt are you referring to?

We have no CCJ’s - a default which was settled immediately
But due to late payments our credit scores are now very poor.
We always pay, but not always on time!

You may be better placed to put this query in the DFW board, along with a SOA. You will get tailored responses about reducing the debt without further borrowing.

If you are making payments just not on time it may be simply a timing issue.

Your credit scores do not impact your eligibility - your history does.

Yorkshire bank said they can offer us 1.59% and an equity loan of 10k subject to checks etc, she said if the interest rates are
Higher than what we can get then she couldn’t see why we
Wouldn’t be accepted.

Turning unsecured debt is not the best plan - it is normally extended over a longer period of time so makes the payments more manageable but costs more in the long run.

Imagine the worst case scenario - but if you don't pay the unsecured debts you can arrange lower payments or miss payments and while not ideal you are unlikely to lose your home, if you don't/can't pay your mortgage you could lose your home.

We have never missed or late paid a mortgage payment, and surely they can see the interest rates are causing us the hassle.

This is good and you want to keep it that way.

What interest rates are causing you problems?

I wondered if anyone knew the likelyness of us being accepted
And if anyone had a similar story? I don’t want to get my hopes up
And then be stuck struggling again.

No-one will be able to tell you the likelihood of acceptance, it's individual between borrower and lender.

Lots of stories all over the forum - search for consolidation loans/lending. It rarely ends well.