We'd like to remind Forumites to please avoid political debate on the Forum. This is to keep it a safe and useful space for MoneySaving discussions. Threads that are - or become - political in nature may be removed in line with the Forum’s rules. Thank you for your understanding.

Loan with Bad Credit

Pikapika1990 Posts: 13 Forumite
First Anniversary First Post
edited 11 June 2022 at 10:47PM in Loans
Hi there

I was wondering if anyone could help?

I am trying to get a loan to consolidate my debt. I have a poor credit rating but loan repayment would not be unaffordable at all, so I am really confused as to why I may be getting declined.

Does anyone know of any specialist brokers online who you can speak to and will find a company that will give you a loan?

I recently bought a house last year by going through a company called Simply Adverse and they were absolutely brilliant and did exactly what they said they would - got me a mortgage. So I am hoping there is a company out there that may be able to help me consolidate these credit cards into a one lump payment each month over the next couple of years so they are gone!!

Thanks in advance


  • longjohnjohnson
    If you're applying to subprime lenders and getting declined, it's probably best to knock the idea on the head.

    I suspect any brokers will be peddling secured loans, and you REALLY don't want to be going down that route.
  • JohnDorian
    JohnDorian Posts: 97 Forumite
    First Anniversary Name Dropper First Post
    What is the reasoning behind you wanting to consolidate? Why not just pay off your current debts as they are? 
  • [Deleted User]
    [Deleted User] Posts: 35,242 Forumite
    First Anniversary Photogenic Name Dropper First Post

    I am trying to get a loan to consolidate my debt. I have a poor credit rating but loan repayment would not be unaffordable at all, so I am really confused as to why I may be getting declined.

    It's because you owe too much already so lenders can't risk giving you further borrowing. You were also in a DMP this time last year, so are a very high risk borrower.

    Head to the DFW boards for advice on cutting costs and clearing your debts.
  • Dobbibill
    Dobbibill Posts: 4,136 Ambassador
    First Anniversary Mortgage-free Glee! Name Dropper First Post
    Consolidation is rarely the answer. Head over to the DFW boards and post a SOA. The good forum members will share hints and tips on how to attack the debt and where you can save some pennies to throw at the debt to get it cleared ASAP. 
    Paying one payment instead of 3 isn't always the right answer - ask about snowballing and focus on the highest interest bearing debt first, snowball that payment to the next debt when cleared and so on. 
    All the best. 
    I’m a Forum Ambassador and I support the Forum Team on the Budgeting & Bank Accounts, Credit Cards, Credit File & Ratings and Energy 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.

    If you can't be the best -
    Just be better than you were yesterday.
  • Ebe_Scrooge
    Ebe_Scrooge Posts: 7,320 Forumite
    Name Dropper First Anniversary Combo Breaker First Post
    Consolidation is rarely the answer.  Firstly, it doesn't repay the debt, merely punts it down the road for a few months.  And the danger is that you take out a loan, clear the credit cards, then merrily go out and spend on them again - before you know it, you've got twice the debt.
    If your credit history is already on the poor side, then that will be one limiting factor.
    The main reason you're struggling to get a loan is most likely down to affordability.  If you have debt on cards and apply for a loan, the lender has no way of guaranteeing that you will actually use the loan to clear the existing debt.  There's nothing to stop you taking the loan money and putting the whole lot on "Knackered Ned" in the 3:30 at Chepstow.  So when they do their affordability calculations, they have to make the assumption that the new loan will be in addition to, rather than instead of, your existing debt.
    As previous posters have said, the only way to tackle the debt is by making some short-term sacrifices for long-term gain - the Debt-Free Wannabe board is an excellent staring point.
  • DCFC79
    DCFC79 Posts: 40,598 Forumite
    Name Dropper First Anniversary First Post
    So if you were in DMP last year, what's happened to that ?
    If your still in the DMP your not meant to take out more finance, speak to who your DMP is with.
  • Sncjw
    Sncjw Posts: 3,516 Forumite
    First Anniversary Name Dropper First Post
    Because you are doubling your debt. They are assessing your affordability on double the debt as there's no garuntee you will use the loan to pay off your current debts. 
    Mortgage free wannabe 

    Actual mortgage stating amount £75,150

    Overpayment start date 1/3/23.

    Starting balance £66,565.45

    Current balance £63,787.16

Meet your Ambassadors


  • All Categories
  • 344.3K Banking & Borrowing
  • 250.5K Reduce Debt & Boost Income
  • 450.2K Spending & Discounts
  • 236.4K Work, Benefits & Business
  • 609.9K Mortgages, Homes & Bills
  • 173.6K Life & Family
  • 249.1K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 15.9K Discuss & Feedback
  • 15.1K Coronavirus Support Boards