Moving house and changing loan

JeanieJ13

We recently moved and kept back capital from the mortgage for works on the new house. There was just enough cash to settle an existing kitchen/car loan with Sainsbury’s which was at 3.3%, so I did that, planning to apply for a smaller loan at 2.9%. That seemed like a good idea!
I probably made the new application too soon, because the old loan won’t be finally cleared until a final DD goes out next month. But we had to start re-wiring immediately, so I did apply for the new loan, and although I went back to Sainsbury’s, the offer is at 8%! It’s too much and I don’t know what to do now. I’d be very grateful for any suggestion. I haven’t rejected the Sainsbury’s offer yet because if we get a better offer in the next 28 days, they will undercut that by 0.1%.

DrEskimo

Whilst its generally agreed that it's a bad idea to turn unsecured borrowing into secured borrowing (particularly on your house..), why didn't you just overpay on your Sainsbury's loan...? The potential 0.4% saving is not really worth the risk and additional admin...

If it's too late and you've already settled, then just try another lender, but I suspect your recent mortgage plus the outstanding Sainsbury's debt is why you are not getting the headline rate.

jonesMUFCforever

IMO Any single digit personal loan is a good rate.
Take the 8% now pay it for 6 months (overpay if you can to reduce interest) then ask them to have another look at a new loa for you.
Too many credit searches in a short period of time will make you look desperate and you may find the next offer will be at a much higher rate.