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Loan advice (2 Parts)

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Loan advice (2 Parts)

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StaglemonStaglemon Forumite
1 posts
MoneySaving Newbie
So I am after some advice regarding a loan please.
Part 1: I am looking to get a loan to replace my car finance as my car finance is about 12% APR for 5 years whilst I can get a loan at around 7.9% with my CR and pay it off in 3 years. When I apply for a loan to replace my current one do I need to tell them I am paying towards that loan currently?
Its just in my mind if they took that payment into account my finances look tighter than they will be.

Part 2: I recently applied for a loan with a company and the representative APR was 3.3% however after getting accepted it was closer to 8%. I have turned it down and cannot reapply for a loan with that company for 30 days. Would this affect an application with a different company within those 30 days?
And my rant is I find it annoying you cannot refuse an offer of a loan if the APR you are offered isnt what you would like, you have to cancel the loan.


  • DrEskimoDrEskimo Forumite
    1.3K posts
    1,000 Posts Second Anniversary Name Dropper
    Part 1: You can apply, but you can't know what rate you will get until they assess your application in full. Yes, they will factor in your existing loans, which may affect your ability to borrow.
    You can still pay down your car loan by overpaying. The difference between 12% and 8% isn't going to be huge....

    Is part 1 and part 2 two separate loans? Why didn't you use this loan at 8% to pay off the car finance?
  • bazzybbazzyb Forumite
    1.4K posts
    Eighth Anniversary 1,000 Posts Name Dropper Photogenic
    Staglemon said:

    Would this affect an application with a different company within those 30 days?

    The most impact this will have is a single hard search on your credit file. Extremely unlikely to have any significant impact - but if you start shopping around doing this several times over it could have an impact.  (They may have only done a soft search at the point they confirmed what rate they would offer anyway). 

    As for your ‘rant’ about rejecting and cancelling, surely they’re one and the same if you hadn’t accepted the loan?
  • DCFC79DCFC79 Forumite
    39.1K posts
    Part of the Furniture 10,000 Posts Name Dropper
    Re 1 yes the lender will assume you will go on a spending spree.
    Re 2 the loan at 8% sounds ideal but a shame you have turned it down. 
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