Self-employed on a low income needs a loaned £3-4k buffer cash to be repaid within 2 years 16 December 2021 at 5:52PM in Loans 78 replies 2.8K views

Ajax67

theoretica said:

  Do you have any particular likely emergency spending in mind that makes you so keen on having a large cash buffer at all times?

I am not sure if 5-6k is a large buffer.

warby68

The only thing I can think of to suggest is that vehicle finance can be a little easier to obtain than other forms of credit because the asset is there for security.

If you were able to finance the van to a modest extent, you could leave some of your savings as standby.

I still think the low income is a difficult hurdle to cross though and the vague reasons for borrowing as you are framing it might put lenders off too.

Ajax67

Sncjw said:

No need for the rude replies we are just trying to help you so that you won't end up struggling financially to meet your living costs or end up in the worse poaition. 

You seem like you want it now and not prepared to sacrifice your savings for the benefit of your future. Which will mean more money coming in.. 

Sorry then. Anyway, I believe the most critical moment will come immediately after the investment, and I will already make some savings within the next few months. 

In any case, if neither is an unsecured personal loan, nor the pool of credit cards an option, I will probably have to try some bad credit hire purchase...

Ajax67

warby68 said:

The only thing I can think of to suggest is that vehicle finance can be a little easier to obtain than other forms of credit because the asset is there for security.

If you were able to finance the van to a modest extent, you could leave some of your savings as standby.

I still think the low income is a difficult hurdle to cross though and the vague reasons for borrowing as you are framing it might put lenders off too.

If I go for some bad credit hire purchase, will I still need to give the finance provider any reasons?

HeinzVarieties

Ajax67 said:

warby68 said:

The only thing I can think of to suggest is that vehicle finance can be a little easier to obtain than other forms of credit because the asset is there for security.

If you were able to finance the van to a modest extent, you could leave some of your savings as standby.

I still think the low income is a difficult hurdle to cross though and the vague reasons for borrowing as you are framing it might put lenders off too.

If I go for some bad credit hire purchase, will I still need to give the finance provider any reasons?

Any lender is going to want to know the reason for the credit, unless it's revolving credit such as a credit or store card.

But you earn far too little and will fail affordability checks on the outset so there is little point in applying.

To be clear, affordability is based on the ONS figures for household expenditure vs your income.  Earning £10k per year is, on paper, completely unaffordable in most areas of the UK.  Anyone who lends you money is lining themselves up for an unaffordable lending complaint if/when you default, so they won't lend you money.

I'd argue that they're right and realistically you should be applying for a business loan, not a personal loan anyway.

Sncjw

You have.15k of savings use that to reinvest in the business.. 

Ajax67

Sncjw said:

You have.15k of savings use that to reinvest in the business.. 

Sure. But a window cleaning business is not only a van, tools, spreadsheets, customer base, DI water or diesel. It is also a cash reserve. 

Ajax67

HeinzVarieties said:

Ajax67 said:

warby68 said:

The only thing I can think of to suggest is that vehicle finance can be a little easier to obtain than other forms of credit because the asset is there for security.

If you were able to finance the van to a modest extent, you could leave some of your savings as standby.

I still think the low income is a difficult hurdle to cross though and the vague reasons for borrowing as you are framing it might put lenders off too.

If I go for some bad credit hire purchase, will I still need to give the finance provider any reasons?

Any lender is going to want to know the reason for the credit, unless it's revolving credit such as a credit or store card.

But you earn far too little and will fail affordability checks on the outset so there is little point in applying.

To be clear, affordability is based on the ONS figures for household expenditure vs your income.  Earning £10k per year is, on paper, completely unaffordable in most areas of the UK.  Anyone who lends you money is lining themselves up for an unaffordable lending complaint if/when you default, so they won't lend you money.

I'd argue that they're right and realistically you should be applying for a business loan, not a personal loan anyway.

Certainly in the ideal world. But in the real world, I would only lose plenty of time, money and energy by preparing various "business plans" and other needless paperwork for the lender. And at the end of the day, they would reject my application anyway.

warby68

Ajax67 said:

warby68 said:

The only thing I can think of to suggest is that vehicle finance can be a little easier to obtain than other forms of credit because the asset is there for security.

If you were able to finance the van to a modest extent, you could leave some of your savings as standby.

I still think the low income is a difficult hurdle to cross though and the vague reasons for borrowing as you are framing it might put lenders off too.

If I go for some bad credit hire purchase, will I still need to give the finance provider any reasons?

Well the reason is the purchase of a vehicle

If they look more closely at your business then it isn't unusual to want to keep a buffer when either starting up or expanding.

However, and again, the amount you want and the vague reasons why you do suggest there is more to your story. I don't know what you mean by a business being a cash reserve.

Ajax67

warby68 said:

Ajax67 said:

warby68 said:

The only thing I can think of to suggest is that vehicle finance can be a little easier to obtain than other forms of credit because the asset is there for security.

If you were able to finance the van to a modest extent, you could leave some of your savings as standby.

I still think the low income is a difficult hurdle to cross though and the vague reasons for borrowing as you are framing it might put lenders off too.

If I go for some bad credit hire purchase, will I still need to give the finance provider any reasons?

Well the reason is the purchase of a vehicle

If they look more closely at your business then it isn't unusual to want to keep a buffer when either starting up or expanding.

However, and again, the amount you want and the vague reasons why you do suggest there is more to your story. I don't know what you mean by a business being a cash reserve.

Is it humanly so difficult to understand that I want and I need to be at any moment in control of at least £5-6k (the money being either in my wallet, on my current account, or existing in the form of the combined credit limit of my credit card(s))? Without this sort of control, I cannot normally function.