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Consolidation depression

I have two credit cards, totalling 15k, I am overpaying the smaller one to hopefully get it rid soon, to then overpay the bigger one (think it's called the snowball effect). I have tried to get a loan to pay them off quicker and cheaper. But although on a soft search I get accepted/100% eligible, when I fully apply I get rejected. Which then damages my credit record for about 6 months. Does anyone have any advice or suggestions? 

Comments

  • I have two credit cards, totalling 15k, I am overpaying the smaller one to hopefully get it rid soon, to then overpay the bigger one (think it's called the snowball effect). I have tried to get a loan to pay them off quicker and cheaper. But although on a soft search I get accepted/100% eligible, when I fully apply I get rejected. Which then damages my credit record for about 6 months. Does anyone have any advice or suggestions? 
    Just pay the cards down. Consolidation rarely works.
  • Yes I agree with ItsComingRome. Pay the cards down first - ensure to overpay the one with the highest interest rate, which may not necessarily be the one with the highest balance. In a while, you could perhaps apply for a 0% interest Balance Transfer card - once some more has been paid off. Before I was helped out by Stepchange and a DRO, I tried a loan for consolidation but it wasn't too successful.
    Please note - taken from the Forum Rules and amended for my own personal use (with thanks) : It is up to you to investigate, check, double-check and check yet again before you make any decisions or take any action based on any information you glean from any of my posts. Although I do carry out careful research before posting and never intend to mislead or supply out-of-date or incorrect information, please do not rely 100% on what you are reading. Verify everything in order to protect yourself as you are responsible for any action you consequently take.
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    Stick with your current plan for the time being. Clear one then tackle the other card. 
  • Pixie5740
    Pixie5740 Posts: 14,515 Forumite
    10,000 Posts Eighth Anniversary Name Dropper Photogenic
    I have two credit cards, totalling 15k, I am overpaying the smaller one to hopefully get it rid soon, to then overpay the bigger one (think it's called the snowball effect). I have tried to get a loan to pay them off quicker and cheaper. But although on a soft search I get accepted/100% eligible, when I fully apply I get rejected. Which then damages my credit record for about 6 months. Does anyone have any advice or suggestions? 
    Consolidation won’t help if you haven’t tackled the root cause of your debt and consolidation is usually the first step on a debt death spiral. My advice is to stop trying to borrow your way out of debt and post on the Debt Free Wannabe board. 
  • Ebe_Scrooge
    Ebe_Scrooge Posts: 7,320 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    As per the previous replies, consolidation loans rarely work - you need to tackle the root cause of the debt.
    As far as the reason for your rejections goes, it's very simple.  A lender cannot guarantee that you'll use the loan to pay off the cards - they have to take the view that you'll spend the loan on something else, leaving your credit card debt untouched.  Therefore, instead of a £15k debt you now have a £30k debt - so it's simply down to affordability.
  • sourcrates
    sourcrates Posts: 30,655 Ambassador
    Part of the Furniture 10,000 Posts I've been Money Tipped! Name Dropper
    Lenders are currently adverse to lending for consolidation purposes anyway, due to covid.

    The very fact your applying suggests financial difficulty, and will most likely be why you got rejected.

    Pop over to the DFW board and we can make suggestions on how to tackle this the right way.
    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
  • Ta for all advice. 
  • DCFC79
    DCFC79 Posts: 40,614 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    Ta for all advice. 

    Just keep on paying them, look at your spending and see if you can cut back on anything.
  • What you might find is that if you manage to clear one of the cards you get a 0% balance transfer offer on that account within days.  Pretty standard practice when an account is cleared.
    That then may allow you to transfer your other card across.

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