How good is a £5.500 loan with 17.8% APR payable in 2 years.

Polo10

Hi money savers, my name is Aldo, I just finished my MA and have college debts to pay. Fortunately I started my new job but my first pay slip will be at the end of May and I urgently need to pay some bills this month.

Abbey offered me a loan of 5.500 with 17.8%(I think is too high!) monthly rates of £269 to cover it in 2 years whithout payment protection.

I'm not sure if if I should take this ammount or probably just half.I already have a carreer development loan of £3,500, I'm afraid of creating a debt domino effect or should I just stop paying bills until I get my pay slip...any advice?

bandraoi

I wouldn't take that.

Polo10

You think is a bad loan. You reccomend me to wait until I get my pay slip next month?

bandraoi

I wouldn't take out a £5500 loan at a very high interest rate to cover me until the end of the month.

If you've started work in April and they haven't put you on the payroll yet, then ask for an advance on your wages, most companies will give you a cheque to tide you over as it's a common problem.

If that's not possible, then try to get a credit card. Try to get one at 0% purchases but if not, any credit card will do. Spend on this instead of spending cash. (Don't withdraw cash) When the bill comes, pay it off in full. So long as the bill is paid off in full before its due date you will incur no interest whatsoever.

Alternatively ask your bank for a (temporary) overdraft. This will allow you some breathing room until your first salary comes in. Spend as little as possible in the meantime and then once you're paid sit down and work out a budget for the month that shows how you're going to make sure you don't need it next month.

Lorne

The interest rate is higher than some of my credit cards were! Shop around you are bound to get a better deal.

Polo10

Wow, I'm glad that I haven't take that loan. Actually I think the best is to wait for next month and be patient, the best think is to know that I have a job and a really want to claer out my scollege debts to save up money and make reliable investments and stop opening a hole to cover another. Thanks for the advice!

RMP_2

try to get a credit card. Try to get one at 0% purchases but if not, any credit card will do. Spend on this instead of spending cash. (Don't withdraw cash) When the bill comes, pay it off in full.

That sounds like good advice to me

foreign_correspondent

Dont get yourself into ANY debt if you can avoid it in any way at all!! Live on beans on toast for a month rather than borrow money!

Polo10

Thanks for the advice guys, I mean get very paranoic when it comes to applying to a credit card, one thing I know once I get one...I create another dead end, start using it for extra-urgent needs and not able to get rid of it. I already have 2 credit cards paying minimums so get a third one would probably make it more difficult to cover the repayments in the future. Thinking about living on beans and toast for a month its difficult to face but its probably the better solution. I think it will be cheaper to pay for the fee charges of one month than a loan on 2 years! Thanks

dannynixon

To be honest, you do not seem in the best financial position to take on more debt. If you must must must take out a loan, can your bank not offer you a graduate loan if you have just finished studying?

Graduate loans are often between 5 and 9% apr

kentkent

am gonna apply for a loan, 20K 11.1% over 48mths, its that a good rate? thanks