Help with Loan

Jonas_Pistolas

Good morning everyone.

I am thinking of going to my bank to ask for a small loan of £5000.
I live in the UK for 4 years and never had a loan.
i have a overdraft and a Credit Card that i want to pay off with those £5000 and pay my council tax for the all year to cut off some of my monthly expenses.

My question is my credit score is poor (280) and i believe my bank is not going to help me. at the moment they dont even increase my overdraft, due to me changing jobs last year.
at the moment i am full employed and the probation as passed, my yearly income is £21000
any other solution? i dont want to go to those dodgy lenders or pay day loans.

the all idea is to get those £5000 and pay off overdraft, credit card and pay a full year of bills

[Deleted User]

Your credit score is irrelevant. They're not used in the UK. Your biggest problem will be your existing debt and adding a further 5k.

Don't go to your bank yet. Try an eligibility checker first to see what your options may be.

Pixie5740

Jonas_Pistolas wrote: »

Good morning everyone.

I am thinking of going to my bank to ask for a small loan of £5000.
I live in the UK for 4 years and never had a loan.
i have a overdraft and a Credit Card that i want to pay off with those £5000 and pay my council tax for the all year to cut off some of my monthly expenses.

My question is my credit score is poor (280) and i believe my bank is not going to help me. at the moment they dont even increase my overdraft, due to me changing jobs last year.
at the moment i am full employed and the probation as passed, my yearly income is £21000
any other solution? i dont want to go to those dodgy lenders or pay day loans.

the all idea is to get those £5000 and pay off overdraft, credit card and pay a full year of bills

Why do you want to pay interest on a loan to cover your council tax bill when it costs you nothing to spread the payments? Usually council tax bills are spread over 10 months but you can ask the council to spread the cost over 12 months which would reduce your monthly expenditure but you wouldn't get February and March "free" so to speak.

Sounds to me like you need to head over the Debt Free Wannabe board rather than getting a loan.

Jonas_Pistolas

At the moment i am paying £35 for my CC, around £25 for using the overdraft every month plus all my existing bills.
My idea was to get a 5k loan to pay the overdraft and CC completely. with the remaining money i want to try and cut my monthly bills, that is why i gave the example of the council tax.
I did an eligibility calculator for a loan and balance transfer cards and i have less then 10% chances.
i do not understand why since my wage is not that bad, got a steady job

poppasmurf_bewdley

£5000 is NOT a small loan.

For someone without any money, such as yourself, £5k is an enormous amount of money.

You will find this out because you will be declined by all normal lenders.

foxy-stoat

Why do you need to take out a payday loan to clear an overdraft and pay for 12 months worth of bills? Sounds crazy.

Try a money transfer card or a balance transfer card to reduce the interest - and cancel the original card.

Edit - if you have a 10% chance then your better off cutting spending, selling stuff and clearing the debt the old fashioned why by over paying it and not borrowing more money.

Pixie5740

Jonas_Pistolas wrote: »

At the moment i am paying £35 for my CC, around £25 for using the overdraft every month plus all my existing bills.
My idea was to get a 5k loan to pay the overdraft and CC completely. with the remaining money i want to try and cut my monthly bills, that is why i gave the example of the council tax.
I did an eligibility calculator for a loan and balance transfer cards and i have less then 10% chances.
i do not understand why since my wage is not that bad, got a steady job

I still don't understand why you would choose to pay interest on a loan to cover your bills when the council, utility suppliers, TV licence, etc don't charge you any interest. That makes no financial sense.

I imagine why your eligibility is low is down to a) living in your overdraft, and b) limited credit history. Honestly, put together an honest statement of affairs and head over to the Debt Free Wannabe board. You're not going to be able to borrow your way out of this.

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

Jonas_Pistolas

Thank you so much for all the replies. really appreciate all the help.

"I imagine why your eligibility is low is down to a) living in your overdraft, and b) limited credit history"

this is exactly my situation.

My point in doing the loan is to cut my monthly expenses and stop living from my overdraft, start saving some money and by the end of 2019 i should have the £5000 to clear the loan

Willing2Learn

The problem with getting the type of loan you are looking at, is that it would double your debt. Many people don't end up in better circumstances after doubling the debt. It quite often gets worse for them, as they did not change their spending or budgeting planning.

As foxy-stoat says, you could get yourself a balance transfer or money transfer card, subject to eligibility, to move your debts onto 0%

DrEskimo

Jonas_Pistolas wrote: »

Thank you so much for all the replies. really appreciate all the help.

"I imagine why your eligibility is low is down to a) living in your overdraft, and b) limited credit history"

this is exactly my situation.

My point in doing the loan is to cut my monthly expenses and stop living from my overdraft, start saving some money and by the end of 2019 i should have the £5000 to clear the loan

As above, your monthly bills for your expenditure will be cheaper than the monthly cost of the loan because things like council tax, tv license, internet, etc do not charge you interest on top of your charges.

Your monthly expenses using a loan would increase, not decrease.

Your overdraft and credit cards might be a different story depending on how much interest you are being charged. But consolidating them with a loan rarely works, and it sounds unlikely you will be able to get a loan at a more favourable rate anyway.

As above, your best way to clear your debts and reduce your monthly expenses would be to do a written budget of all your expenditure and work out where you can save and how much you can use to pay down your debts.

Filling out a Statement of Affairs, as linked above, can be a useful way of working out your budget and getting advice on where you can make savings in your monthly expenses.