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    • topspin100
    • By topspin100 17th May 18, 8:54 AM
    • 3Posts
    • 0Thanks
    topspin100
    debt consolidation
    • #1
    • 17th May 18, 8:54 AM
    debt consolidation 17th May 18 at 8:54 AM
    Hi! As my credit card's 0% period is coming to an end I'm looking to consolidate my debt with a (cheaper) loan. My overall credit score is quite good (no missed payments etc.), but the affordability score is pretty low because of my relatively low income. I have recently taken up another part-time job and this increases my annual income by about 50%. How long will it take until this is being taken into account by potential lenders, does anyone know? Do I need to wait until the first payslip from the new job, or even the first three, or...?

    I don't want to mess up my chances of getting a loan by applying into the blue. Many thanks in advance for any replies!
Page 1
    • zx81
    • By zx81 17th May 18, 8:59 AM
    • 18,602 Posts
    • 19,857 Thanks
    zx81
    • #2
    • 17th May 18, 8:59 AM
    • #2
    • 17th May 18, 8:59 AM
    It varies by lender.

    What's your debt and income? If you go for a loan, yo'll be asking a lender to double your debt.

    Have you looked at BT options, or tried an eligibility checker? Ignore your credit score, but try some soft searches instead.
    • topspin100
    • By topspin100 17th May 18, 9:10 AM
    • 3 Posts
    • 0 Thanks
    topspin100
    • #3
    • 17th May 18, 9:10 AM
    • #3
    • 17th May 18, 9:10 AM
    Thanks for your reply. Debt is 6k, income about 18k p.a. (only taking effect next month). Applied for a new cc to transfer balance at 0% a while ago, but their credit limit was too low because of my income. :-( Have tried eligibility calculator, but unsure if and when I can add 2nd income to my gross earnings....
    • zx81
    • By zx81 17th May 18, 9:25 AM
    • 18,602 Posts
    • 19,857 Thanks
    zx81
    • #4
    • 17th May 18, 9:25 AM
    • #4
    • 17th May 18, 9:25 AM
    You should have taken the card and transferred what you could.

    Make sure you don't turn down any future promo offers.

    You can use your new income once you start earning it.
    • DCFC79
    • By DCFC79 17th May 18, 10:18 AM
    • 32,555 Posts
    • 20,484 Thanks
    DCFC79
    • #5
    • 17th May 18, 10:18 AM
    • #5
    • 17th May 18, 10:18 AM
    Hi! As my credit card's 0% period is coming to an end I'm looking to consolidate my debt with a (cheaper) loan. My overall credit score is quite good (no missed payments etc.), but the affordability score is pretty low because of my relatively low income. I have recently taken up another part-time job and this increases my annual income by about 50%. How long will it take until this is being taken into account by potential lenders, does anyone know? Do I need to wait until the first payslip from the new job, or even the first three, or...?

    I don't want to mess up my chances of getting a loan by applying into the blue. Many thanks in advance for any replies!
    Originally posted by topspin100

    Consolidating rarely works unless your willing to stick to the plan. Reduce your spending so you have more money to use for the card debt.
    • topspin100
    • By topspin100 17th May 18, 11:44 AM
    • 3 Posts
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    topspin100
    • #6
    • 17th May 18, 11:44 AM
    • #6
    • 17th May 18, 11:44 AM
    Consolidating rarely works unless your willing to stick to the plan. Reduce your spending so you have more money to use for the card debt.
    Originally posted by DCFC79
    Well, I'm sure at least my credit card company would approve of this kind of advice!

    Paying off the cc at 19.9% APR will obviously cost me a lot more than, say a 5-year loan!
    • Larac
    • By Larac 17th May 18, 11:59 AM
    • 845 Posts
    • 529 Thanks
    Larac
    • #7
    • 17th May 18, 11:59 AM
    • #7
    • 17th May 18, 11:59 AM
    Consolidating rarely works unless your willing to stick to the plan. Reduce your spending so you have more money to use for the card debt.
    Originally posted by DCFC79
    Wise words - been down this route and got the t-shirt. Few years later ended up on a DMP. By consolidating - it does not address the problem of the 'overspend'.
    • Dobbibill
    • By Dobbibill 17th May 18, 12:47 PM
    • 3,309 Posts
    • 4,231 Thanks
    Dobbibill
    • #8
    • 17th May 18, 12:47 PM
    • #8
    • 17th May 18, 12:47 PM
    OP - do a soft search on CCs for a BT before applying - once you've done an application, take whatever limit they offer (some at 0% is better than none).
    A 2nd card could take care of the remaining interest bearing balance (limit permitting) - a consolidation loan rarely works even with the best intentions. If you were to apply for a loan your rate would be based on the providers assessment of you at the time and may not be lower than 19.9%, some posters have been offered 24% etc.
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    • Tarambor
    • By Tarambor 17th May 18, 1:05 PM
    • 3,547 Posts
    • 2,620 Thanks
    Tarambor
    • #9
    • 17th May 18, 1:05 PM
    • #9
    • 17th May 18, 1:05 PM
    Well, I'm sure at least my credit card company would approve of this kind of advice!

    Paying off the cc at 19.9% APR will obviously cost me a lot more than, say a 5-year loan!
    Originally posted by topspin100
    Only if you don't use the credit card again. If you do then you'll have a loan and a credit card to service.
    • Nasqueron
    • By Nasqueron 17th May 18, 1:06 PM
    • 5,448 Posts
    • 3,357 Thanks
    Nasqueron
    Well, I'm sure at least my credit card company would approve of this kind of advice!

    Paying off the cc at 19.9% APR will obviously cost me a lot more than, say a 5-year loan!
    Originally posted by topspin100
    The problem is that for every 1 person who will pay off a CC with a loan, cut it up and never use it again there will be 10s, if not 100s, who see an empty CC and run it up again meaning the loan + CC is now 2x as much debt. Remember you have a CC which you have known had an end date since you took it out yet haven't got it paid off and now you want to take on more debt on top?

    That is why banks now check affordability of a loan and base a decision on whether you could afford both debts together because there is no guarantee you will use the loan for the CC. Remember Ocean Finance and their adverts where people were shown saving money on monthly repayments and then going off sunning themselves on a beach? Those are the typical people who consolidate. Even if it's not a beach, it's the sudden car bill, the home repair, kids need new stuff etc etc

    You would be best approaching your CC firm and if they do loans, get them to do the loan, pay off the CC themselves and then close it, removing any chance of the money being used elsewhere. Otherwise, apply for another BT card, ideally one aimed at the lower end of the market and whatever limit you get, use it, pay the minimum and hit the remaining balance on your main card hard
    • MEM62
    • By MEM62 17th May 18, 1:18 PM
    • 1,720 Posts
    • 1,324 Thanks
    MEM62
    Consolidating rarely works unless your willing to stick to the plan. Reduce your spending so you have more money to use for the card debt.
    Originally posted by DCFC79
    Well, I'm sure at least my credit card company would approve of this kind of advice!

    Paying off the cc at 19.9% APR will obviously cost me a lot more than, say a 5-year loan!
    Originally posted by topspin100
    The advice from DCFC79 is sound. Reduce your spending so that you reduce your card debt faster. That is by far the best way to reduce exposure to interest. Consolidation loans often carry a higher interest rate and over a length period can be just as expensive a CC debt that is paid off quicker.

    The general wisdom here is that consolidations loans do not work and I am sure that you arrived here because you held the belief that these guys know what they are talking about. You have the opportunity to learn from other peoples experience / mistakes. Don't let that pass you by :-)
    • MallyGirl
    • By MallyGirl 17th May 18, 4:22 PM
    • 2,954 Posts
    • 7,951 Thanks
    MallyGirl
    Well, I'm sure at least my credit card company would approve of this kind of advice!

    Paying off the cc at 19.9% APR will obviously cost me a lot more than, say a 5-year loan!
    Originally posted by topspin100
    That all depends on the loan APR and length really. For some, taking a long loan means that they take their foot off the gas with the debt busting whereas seeing the interest spurs them into throwing everything at the debt and getting it cleared much quicker.
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