Help!!!

curlyfryhead

Hello, I'm new, I've been directed here by a friend who is bored of listening to my problems!

I'm a student and I'm due to graduate this year. I've managed to get myself in to quite a bit of debt (alhough I do have a spectacular shoe collection!) and I reckon I'll need about a £10k loan over 4 or 5 years to set myself straight. Here's what I owe:

Virgin credit card - £3,000
Mint credit card - £3,000
Barclaycard - £1,300
My parents - £500
Overdraft - £1,500 (interest free for another year)

At the moment, I work in a restaurant and probably take home an average of £500-£600 a month including tips. I pay out at least £200 of this. I am already applying for full-time work to start once I move home. The salaries for these jobs are around £16k - £18k, but if I don't get accepted, I can stay with the same restaurant company and work full-time, earning around £12k including tips. I don't have a student loan so that won't come out of my wage.

My problem is that my Virgin and Mint cards have recently started charging me interest of about £100, so half the money I pay each month isn't even denting my debt! This makes me sad. My bank have offered me the money but at 14.9% APR and I've been doing a bit of research and I reckon I could get a much better deal than that. I will still be able to afford at least £200 a month even if I struggle to fing full-time work.

I'm worried that if I apply for a loan now and get rejected, this will make it harder to get a loan in the future. I don't know whether to apply for two new credit cards with 0% interest and then apply for a loan when I find full-time work, but I think this will alter my credit rating and look a bit dodgy, increaing my risk of getting rejected.

Phew, are you still with me?!?!

I see these as my options:

a) Apply for a loan now and risk being rejected
b) Keep paying interest on my credit cards and wait until I find a better paid job to apply for a loan.
c) Apply for two credit cards now and a loan when I find a job, even though this may make it less likely to be offered a loan
d) Accept the offer from my bank
e) Move to a different country and change my name (joke!)

Also, should I be borrowing more to pay off an overdraft that is interest free?

Any help will be much appreciated, I'm getting myself into a bit of a tizz worrying about this when I really should be concentrating on my finals!

Thanks.

RiaAnn

No point in paying of the free overdraft with a loan you will be paying interest on.

What are the APR's on your credit cards? and do you have a good credit history at the moment? (any missed payments?)

jonesMUFCforever

If you get a job won't your bank offer you a Graduate account with loan?

curlyfryhead

RiaAnn wrote: »

No point in paying of the free overdraft with a loan you will be paying interest on.

What are the APR's on your credit cards? and do you have a good credit history at the moment? (any missed payments?)

I've never missed a payment, even though I'm in a lot of debt, I've always been quite good at managing it eg. being a card tart! Not too sure on the APR, got a feeling the Virgin is about 30%APR but I'd have to check

Good point about the overdraft though, never thought of it like that ! Thanks

curlyfryhead

jonesMUFCforever wrote: »

If you get a job won't your bank offer you a Graduate account with loan?

I'll have to have a look at that too thanks. Is that something that they commonly do? Would it depend on my job?

jonesMUFCforever

curlyfryhead wrote: »

I'll have to have a look at that too thanks. Is that something that they commonly do? Would it depend on my job?

No if you graduate from a degree course most banks will want to hang on to you as a customer and will offer in most cases an interest free overdraft subject to your salary being credited and a low rate loan of up to (again most cases and subject to credit score) of £10k.

dannynixon

jonesMUFCforever wrote: »

No if you graduate from a degree course most banks will want to hang on to you as a customer and will offer in most cases an interest free overdraft subject to your salary being credited and a low rate loan of up to (again most cases and subject to credit score) of £10k.

This is true but I know from my own experience, Natwest will only give you a loan for the length of your contract. Not sure about other banks though.

I started a job as a teacher in september on a one year contract and applied for a Graduate loan of 2 years. They accpeted the loan etc, sent the papers and rejected it right at the end and said they would only give me a graduate loan for 1 year. They said to me either get a contract extension, a permanent job or take the loan over 1 year.

Dan

Kavanne

Have you hought of retrospectively applying for this year's maintenance loan? It's at a lower rate of interest that a personal loan would be so that's £3000 less you would need to worry about.

I think you have until May.