🗳️ ELECTION 2024: THE MSE LEADERS' DEBATE Got a burning question you want us to ask the party leaders ahead of the general election? Submit your suggestions via this form or post them on our dedicated Forum board where you can see and upvote other users' questions. Please note that the Forum's rules on avoiding general political discussion still apply across all boards.

secured loan help

Options
i have a rbs loan of £10,000 taken out jan 18 its 14% interest 10 years they wont drop it so i have applied for a secured loan on my house £15000 7%10 years also to add a credit card balance £3500 26% i cant get a zero % card as my credit rating is poor, and new boiler needed i am using ocean finance any idea if im doing the right thing as i cant afford to pay more money towards the credit card or loan
«1

Comments

  • DCFC79
    DCFC79 Posts: 40,598 Forumite
    Name Dropper First Anniversary First Post
    edited 17 June 2018 at 8:20PM
    Options
    i have a rbs loan of £10,000 taken out jan 18 its 14% interest 10 years they wont drop it so i have applied for a secured loan on my house £15000 7%10 years also to add a credit card balance £3500 26% i cant get a zero % card as my credit rating is poor, and new boiler needed i am using ocean finance any idea if im doing the right thing as i cant afford to pay more money towards the credit card or loan

    You sure turning unsecured loan into a secured loan is a good idea ? I bet you know this but your home will be at risk if you don't keep up with the payments.

    I understand your reasons for doing it. Your credit history is what lenders see and forms part of the decision for finance, your credit rating isn't seen by lenders.

    No the lender won't decrease the Apr for the loan as the 14% is the best you can get.
  • floridafoofoo
    Options
    yes i can pay it and I can afford £160 per month as paying rbs loan £171 and cc £100 per month my house has approx £65,000 equity but rbs turned me down a re mortgage to release funds so i sort of understand my house will be at risk if i fail to pay but feel £156 per month is better i do wish rbs would drop the interest to 7% they wont budge oh well will have a think thanks
  • [Deleted User]
    Options
    If you must take out a secured loan have you had a word with your mortgage lenders I'm sure they could beat 7% which will be a lot of interest on 15k over 10 years.
  • DCFC79
    DCFC79 Posts: 40,598 Forumite
    Name Dropper First Anniversary First Post
    Options
    yes i can pay it and I can afford £160 per month as paying rbs loan £171 and cc £100 per month my house has approx £65,000 equity but rbs turned me down a re mortgage to release funds so i sort of understand my house will be at risk if i fail to pay but feel £156 per month is better i do wish rbs would drop the interest to 7% they wont budge oh well will have a think thanks

    How much is the new boiler going to cost ?

    You looked at your spending so you have extra money to pay the debt off ?

    If you do get a secured just make sure you pay it off.
  • floridafoofoo
    floridafoofoo Posts: 6 Forumite
    edited 17 June 2018 at 8:31PM
    Options
    my mortgage can only lend me a home loan from £25,000 so may stick to secured loan thanks and new boiler 1500.00
  • ViolaLass
    ViolaLass Posts: 5,764 Forumite
    Options
    Could easily be cheaper to borrow £25k from your mortgage company, choose a deal with no ERCs and immediately overpay by £10k.
  • Pixie5740
    Pixie5740 Posts: 14,515 Forumite
    Name Dropper First Post Photogenic First Anniversary
    Options
    Is the interest rate with Ocean Finance fixed or variable?
  • Pixie5740
    Pixie5740 Posts: 14,515 Forumite
    Name Dropper First Post Photogenic First Anniversary
    Options
    From Ocean Finance's website:

    "Homeowner loans are secured against your property. We are a broker and we arrange secured loans from a panel of lenders. We receive commission upon completion. A fee of 12.5% of the net loan amount, capped at £2,975, is payable upon completion and can be added to your loan."

    :eek:
  • Brock_and_Roll
    Brock_and_Roll Posts: 1,207 Forumite
    First Anniversary First Post
    Options
    OP,


    have I read this correctly? - you took out a £10k personal loan at 14% in January this year (of course they wont drop it, you have only just taken it out!).....then just a few months later you need an additional £15,000k


    So that's £25k of borrowing. Lets say £4k max for a new boiler and £3.5k for the credit cards....what was the other £17.5k for?


    Without any further information it looks like there is a significant debt problem here and a very slippery slope to losing everything you have including your house.


    As is often pointed out here, additional borrowing is very rarely a good solution to debt issues, unless the underlying causes of the overspending are addressed. Secured borrowing even less so.


    I would suggest posting an SOA here.
  • sourcrates
    sourcrates Posts: 29,038 Ambassador
    First Anniversary Name Dropper First Post Photogenic
    edited 18 June 2018 at 11:04AM
    Options
    i have a rbs loan of £10,000 taken out jan 18 its 14% interest 10 years they wont drop it so i have applied for a secured loan on my house £15000 7%10 years also to add a credit card balance £3500 26% i cant get a zero % card as my credit rating is poor, and new boiler needed i am using ocean finance any idea if im doing the right thing as i cant afford to pay more money towards the credit card or loan


    Basically you are jumping out of the frying pan, and into the fire.........!!


    You will be exceptionally lucky to get the secured loan at 7%, that will be the headline rate, about 1% of borrowers will achieve, the rest, like you, may be offered a much higher rate, and remember, this rate may be fixed for part of the loan, but inevitably will become a variable rate, you are also paying the commission from ocean, if your budget is tight now, then an interest rate rise could take you over the edge.


    You appear to be following the same old path most people take when they realise they have made a bad financial decision, consolidation, I would advise you now not to go anywhere near this option, you may be lucky, but its a big gamble with the roof over your head.


    The way to deal with unmanageable debt is to seek debt help, not continue borrowing more money, making the situation even worse.


    I would strongly urge you to get over to the DFW forum, post a statement of affairs, and lets see where we can help you, without the need to borrow more money.
    I’m a Forum Ambassador and I support the Forum Team on the Debt free wannabe, Credit file and ratings, and Bankruptcy and living with it boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.For free non-judgemental debt advice, contact either Stepchange, National Debtline, or CitizensAdviceBureaux.Link to SOA Calculator- https://www.stoozing.com/soa.php The "provit letter" is here-https://forums.moneysavingexpert.com/discussion/2607247/letter-when-you-know-nothing-about-about-the-debt-aka-prove-it-letter
This discussion has been closed.
Meet your Ambassadors

Categories

  • All Categories
  • 8 Election 2024: The MSE Leaders' Debate
  • 343.9K Banking & Borrowing
  • 250.3K Reduce Debt & Boost Income
  • 450K Spending & Discounts
  • 236K Work, Benefits & Business
  • 609.2K Mortgages, Homes & Bills
  • 173.4K Life & Family
  • 248.6K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 15.9K Discuss & Feedback
  • 15.1K Coronavirus Support Boards