Please help!

falken

Hi
We are thinking about taking out a secured loan for £25000 to clear debts. We have about that equity in our house. We unfortunately have a bad credit rating due to not paying creditors as we decided to become self employed and didn`t earn enough to afford to pay them. Instead we agreed payment plans which we keep paying every month but this has still affected our credit rating. We cannot get a standard loan and are desperate to pay them all off. We keep renegotiating our payment plans and are struggling as they all total £350 a month. We have £100 a week to live of with 2 children. I have heard ocean finance might help and can give a 3 months off until payment starts. We are still self employed and will draw a wage in 3 months time. Can anyone offer a better alternative, or is ocean a good option? Also if we take a secured loan and keep up payments will this improve our credit rating? We just want all our debts cleared up as we are trying everything we can to get back on top.

Thanks for your help

Deep_In_Debt

Hi
Welcome to the board. It's generally not advisable to take out a further loan - it's not actually clearing your debt and if it's secured you could put your house at risk if you default.

Have you sought advice from either CCCS, National Debtline or CAB? They are all free and offer impartial advice.

Good luck.

Scarlett.1974

Hi falken,

I can tell how desperate and worried you are about this from the tone of your post but please, PLEASE re-consider this. It's very rarely (if ever) a good idea to turn unsecured debt into secured. You say you're struggling with the payments now - once this debt is secured on your home the stakes are a LOT higher and if you miss payments you risk losing your home - it really is as simple as that.

Another reason that consolidation is rarely a good idea is (and I mean this in the nicest possible way ) have you actually learnt anything from being in debt? What's to stop you running it all back up again? Spending on those 'empty' CCs and OD again? (been there, done that).

The VERY worst thing we did was consolidate and secure our debt on the house My husband lost his job through ill health, we couldn't afford the repayments....... fast forward and we're now BR, our house has been repossessed and we're living in rented. You never know what's around the corner, you really don't.

Why don't you pop up your SOA and let the good people here have a look at it and see if they can advise you of a different way to deal with it?

I hope I haven't caused any offense with this post, I genuinely haven't meant to.

bountiful

Hi falken - if you can post a SOA (statement of affairs - see sticky threads at top of page for how to do this) - then people can get a better picture of how you are currently managing - and suggest ways of reducing outgoings and getting best solution for the debts. Plenty of very wise and experienced people on here to help you
:money:

Cleosmum

Current worse case scenario is that you go to court for not paying debts and could be made to pay token payments of £1 a month on each debt.

Secured loan worst case scenario is you lose the roof over your heads.

I think you are barmy to even consider a secured loan.

SuzySu

Hi

I have replied to the thread you started over on the Loans board.

Deep_In_Debt

You could contact one of the companies I suggested. They may be able to set up a DMP for you (I'm on a DMP with CCCS). They will go through your income and expenditure and work out an affordable monthly repayment for the creditors to be paid. Also, they have good success at getting interest and charges frozen. Ok, it will take a while to pay it off but at least you are not incurring further borrowing and actually clearing your debts rather than increasing them.

I have £27k of debt and loan companies were falling over themselves to offer me secured loans. That was not an option for me as I did not want to put my house at risk. My mortgage is affordable and I've never defaulted on it and by getting a secured loan I would be struggling every month, thus putting my house at risk. I'm about to be made redundant too, so as others say, you never know what's around the corner.

falken

Thanks everyone, its great to know that support is out there. I will find out my exact amounts owed along with interest rates and post them here with my income/expenditure detail.

Thank you!