Applying for a loan - Should I select the 'consolidate debt' option or stick with 'home improvements

Matthew1279

Howdy,

A simply question in the hope someone out there in internetland might know more than my good self.

I've heard through the grapevine ( sounds like a song! ) that when saying asking for a loan ( or extended loan in my case ) via the usual tesco, sainsburys ( many others available ) , that when comes to the 'reason' why you want the loan it's best not to say, 'debt consolidated' . Now, in my case, this certaintly would be true reason, creditcards/interest - but it's better to say 'for home improvments' or another option.   

Any truth in this?   

Thoughts are kindly welcome.

marcia_

Matthew1279 said:

Howdy,

A simply question in the hope someone out there in internetland might know more than my good self.

I've heard through the grapevine ( sounds like a song! ) that when saying asking for a loan ( or extended loan in my case ) via the usual tesco, sainsburys ( many others available ) , that when comes to the 'reason' why you want the loan it's best not to say, 'debt consolidated' . Now, in my case, this certaintly would be true reason, creditcards/interest - but it's better to say 'for home improvments' or another option.   

Any truth in this?   

Thoughts are kindly welcome.

 Why would someone lie? 

MorningcoffeeIV

Debt consolidation does indicate a higher risk, but home improvements would be fraudulent, so I wouldn't choose that one. 

They'll still see that you're already heavily indebted in any case, and doubling up your debt is high risk on itself so stick with the truth.

Sarahspangles

If you tick ‘debt consolidation’ then that’s telling them upfront you have a debt problem, but they will be able to see that from your credit record whether or not you tick the box.

If you tick ‘home improvements’ that’s telling them you’re planning on going further into debt, although hopefully offset with some improvement in the value of your home.

They may actually approve refinancing of your current debt more readily than letting you go further into debt.

Do consider getting advice from the Debt Free Wannabe forum first - there may be better long term options.

Matthew1279

thank you both for you speedy replies, yes, i would in past opted for 'the truth' which it really is, a loan to pay back a bit of a mess i have gotten into with a few creditcards ( never missed a payment etc but aware only myself to blame ).

Ok - 'refinancing' option...ok...looks like i will look into that one then.

Actually, the top up loan would be in part for home improvements but paying off creditcards first - so its a bit of both..but the common sense option is naturally get rid of the cards even if means going back too them down the road.

Ok thanks again. Tough call really.