Loan newbie - fixed rates - need help to understand taking out a loan

beckyben89

Unfortunately, I am in the bad situation of needing a loan due to unforeseen circumstances. I always said I would never get a loan, now I need to because spiralling costs are going to possibly eat up my savings and more.

My relatives are worried about rising interest rates. But can I take out a loan that is definitely fixed rate? Can anyone recommend some to me.

I have a good credit score and income for next year at least. I need to get anywhere from £7.500 to 10k, preferably over 10 years.

If anyone can help a newbie to this that would be great, thanks so much

sammyjammy

Your post makes no sense, what do you need to borrow this money for?  So that you can keep your savings?  Thats a crazy thing to consider.  If you did take a fixed rate there is no risk of the rate changing, remember you probably won't get the advertised rate.

If you are considered about costs and your budget a better option would be to post your outgoings and income on Reducing debt board for help and advice.

[Deleted User]

Any personal loan will be fixed rate. 

You'll be assessed on your risk levels though, not your credit score. This will include your credit history, previous and current debts, address stability, income, ER registration, and so on.

The main thing that comes out of your post is that you want a loan of 8k over 10 years, which suggests you don't have the necessary affordability to get a loan. 

If you're set on getting a loan, an eligibility checker would be the starting point.

Ebe_Scrooge

beckyben89 said:

Unfortunately, I am in the bad situation of needing a loan due to unforeseen circumstances. I always said I would never get a loan, now I need to because spiralling costs are going to possibly eat up my savings and more.

Reading between the lines, it almost seems like you're saying you need a loan just to meet everyday living expenses?  If that's the case, then you absolutely do not need a loan - a loan to cover routine living costs would be sheer madness.

beckyben89 said:

I have a good credit score and income for next year at least. I need to get anywhere from £7.500 to 10k, preferably over 10 years.

Your credit score means nothing.  You have income for the next year?  Great.  What happens when the income ceases?  You've still got to pay the loan repayments - as well as eat.  And, as ZX81 says, if you want a loan over 10 years, that gives a pretty good indication that you really can't afford it.

I suspect there's a lot more to this than you're telling us.  Give us the full facts - what is the real reason you need a loan?  There will be options and ways around things, and plenty of helpful folk here who can help, but we can't offer any meaningful advice until we know the background.

ndf9876

beckyben89 said:

Unfortunately, I am in the bad situation of needing a loan due to unforeseen circumstances. I always said I would never get a loan, now I need to because spiralling costs are going to possibly eat up my savings and more.

Any advice you're given would be on the basis that you use your savings up before even contemplating a loan, because loan interest rates (even the lowest) are higher than what you'd achieve with cash. If you do not have savings to use on "spiralling costs", you might want to try and rein those costs in, in if possible. Borrowing more is only going to add to these costs.

My relatives are worried about rising interest rates. But can I take out a loan that is definitely fixed rate? Can anyone recommend some to me.

As zx81 said, you'll be individually assessed, so it's impossible to make any recommendations. Any unsecured personal loan will be at a fixed APR though.

I have a good credit score and income for next year at least. I need to get anywhere from £7.500 to 10k, preferably over 10 years.

I believe most lenders now ask you specifically if you're aware of anything that may happen in future that will impact your ability to repay. Your post suggest that your income will change (I interpreted it as for the worse) and on that basis, do you think taking a £10k loan is responsible? I also think you might struggle to get an unsecured personal loan over that duration (certainly the likes of Hitachi, Nationwide and Santander, to name a few, have a maximum loan length of 5 years).

If anyone can help a newbie to this that would be great, thanks so much

I've given my answers inline, but I completely agree with previous comments.

anotheruser

To be fair though, I have some savings but would consider taking a loan over 5 years or so to cover something like buying a car.
Saving up the money to buy a new car is out of the question as that will take 5 years.
The savings are for something particular so don't really want to touch them either.

DrEskimo

anotheruser said:

To be fair though, I have some savings but would consider taking a loan over 5 years or so to cover something like buying a car.
Saving up the money to buy a new car is out of the question as that will take 5 years.
The savings are for something particular so don't really want to touch them either.

Why is saving for 5 yrs "Out of the question?". Cars can last for up to 10-yrs before needing replacing and the replacement should be accounted for in your budgeting.

Jami74

anotheruser said:

To be fair though, I have some savings but would consider taking a loan over 5 years or so to cover something like buying a car.
Saving up the money to buy a new car is out of the question as that will take 5 years.
The savings are for something particular so don't really want to touch them either.

Honestly, buy a cheaper car!
I was refused a £10k loan, 3 years ago, and I'm really glad now that I was. I bought something much cheaper and even though it has needed repairs along the way it has still cost much less than paying back a loan would have done.