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  • FIRST POST
    archived user
    How the flip are you meant to get a debt consolidation loan if your declined because your debt high!
    • #1
    • 5th Aug 18, 1:39 PM
    How the flip are you meant to get a debt consolidation loan if your declined because your debt high! 5th Aug 18 at 1:39 PM
    It's so frustrating.

    I have 31,500 I would like to refinance as it's now on 25% interest rate (mostly credit cards). I was swapping it around, but can no longer do that.

    My credit score is 701 (poor), ONLY due to affordability. Never missed a payment. No late payments. No CCJs or otherwise. Not a homeowner either, which for some bizarre reason counts against you.

    If I could combine into a nice say 7% APR loan over a longer term (5 years), I've worked out it would save me 281 a month.

    It seems my only option is go to a debt consolidation agency/charity. But I don't want to do this. I want to pay my way. I don't mind paying the interest. And I imagine having arrangements with creditors would kill my credit score.

    So what is a guy left to do???
Page 3
    • Tarambor
    • By Tarambor 6th Aug 18, 2:35 PM
    • 3,942 Posts
    • 2,985 Thanks
    Tarambor
    I appreciate you trying to help.

    But this "mess!" I am in was planned.
    Originally posted by lawero1
    No it wasn't because if it was you'd not now be posting on here because you have been declined for debt consolidation. You got it in your head you could just continue to balance transfer and consolidate ad infinitum and the wheels have come off that plan and now you realise just how much you're going to end up repaying.

    Imagine you were queuing for the most amazing thing you always dreamed off. Maybe it is a concert, a club, a plane to somewhere you have always dreamed of going. In front of you is an endless queue of people. It!!!8217;s 10 entry. You may get in, you may not. Then someone says to you, I will let you skip the queue but instead of paying 10, you have to pay 15.
    Except it wouldn't be 15 would it at 25% APR making minimum payments? And you've finally figured out just how much 25% APR on 31,500 is going to be. It is going to be around 7500 this year and several grand per year for the next four or five.
    Last edited by Tarambor; 06-08-2018 at 2:37 PM.
    • Thrugelmir
    • By Thrugelmir 6th Aug 18, 6:01 PM
    • 61,302 Posts
    • 54,550 Thanks
    Thrugelmir
    The proposition is pretty simple really. I can continue to pay 25% interest. Or I can find a company who will pay these debts off and offer me a lower interest rate.
    Originally posted by lawero1
    People generally don't though. That's the statistical fact that commercial lending is based on. The interest rates on offer group you with everyone else in the same borrowing category. Defaults have to be paid for.
    Financial disasters happen when the last person who can remember what went wrong last time has left the building.
    • okidoodle
    • By okidoodle 30th Aug 18, 9:42 PM
    • 40 Posts
    • 37 Thanks
    okidoodle
    Have you just been to new lenders and been looking online? It might be worth approaching one of the banks you already have credit with, explaining that you are looking to manage your debt better, and that you would like a loan to pay off some existing credit and consolidate. I did that with my bank and their deal was that they could do that if they reduced some of my other available credit, so lowered the limit on my credit card and overdraft which were both paid off by the loan.
  • archived user
    Yes, I tried this, but they said no. Guess they are making more interest off me now so it's not in their best interests.
    • Willing2Learn
    • By Willing2Learn 31st Aug 18, 6:37 PM
    • 1,830 Posts
    • 1,412 Thanks
    Willing2Learn
    Guess they are making more interest off me now so it's not in their best interests.
    Originally posted by lawero1
    You are not being turned down because they are earning so much interest from you. You are being refused loans because the lenders don't think you can afford it...You are too much in debt that they don't want to touch you...

    You are 48k in debt on the cards plus you have two outstanding loans. If you get another loan it would just mean more debt.

    Post your SOA if you want meaningful advice (I posted the link earlier).
    Last edited by Willing2Learn; 31-08-2018 at 6:39 PM.
    I work within the voluntary sector, supporting vulnerable people to rebuild their lives.

    I love my job

    • DCFC79
    • By DCFC79 1st Sep 18, 8:29 AM
    • 33,128 Posts
    • 20,864 Thanks
    DCFC79
    Have you just been to new lenders and been looking online? It might be worth approaching one of the banks you already have credit with, explaining that you are looking to manage your debt better, and that you would like a loan to pay off some existing credit and consolidate. I did that with my bank and their deal was that they could do that if they reduced some of my other available credit, so lowered the limit on my credit card and overdraft which were both paid off by the loan.
    Originally posted by okidoodle
    It wont always work with everyone, the OP needs to increase his income or make saings somewhere.
    • DCFC79
    • By DCFC79 1st Sep 18, 8:31 AM
    • 33,128 Posts
    • 20,864 Thanks
    DCFC79
    Yes, I tried this, but they said no. Guess they are making more interest off me now so it's not in their best interests.
    Originally posted by lawero1
    Any luck with the business manager ?


    It is OK tho. I think I have just figured out a solution through our business manager.
    Originally posted by lawero1
    • TriggerHappy
    • By TriggerHappy 2nd Sep 18, 10:02 AM
    • 52 Posts
    • 52 Thanks
    TriggerHappy
    Hiya,

    Just reading through I can see how it must be getting pretty frustrating as people are arguing against what you believe to be the best way forward.
    In my experience, everyone here has your best interests at heart but equally they see time and time again where someone hasn't accepted that they've dug a hole and it's so deep that the banks see you as too much of a risk.

    One thing which I don't think I've seen is this - are you making a lot of applications for new credit (I.e. consolidation loans)? If you are and failing then that will trash your credit profile further and make you look even riskier.

    Secondly, I can't see where you have stated your income and type of employment you're in? If you're salary is 50k and you have debts of 31,500 with other outgoings such as rent and bills being 40% of your income then a loan on top of your existing credit commitments would be seen to be irresponsible lending.

    You may be at the stage where you need to just chill out and do nothing in regards to addressing your debt for 6 months or so. Just make your payments, slightly above minimum ideally. While you do this, consider speaking to a Credit Union as they may be more forthcoming but they may need to see you actually saving for a period before being willing to loan to you.

    The last thing I would say is that you probably need to be less 'positive' in regards to your debt. Saying things like "I planned to get into 31,500 because I wanted to live while I was young enough to enjoy it" sounds like "I've maxed my credit options, nobody will offer me more and it's not fair".

    Good luck!
    • Herzlos
    • By Herzlos 2nd Sep 18, 4:14 PM
    • 8,609 Posts
    • 7,905 Thanks
    Herzlos
    I echo the 6 month thing. Spend 6 months with the current cards overpaying as much as you can, then try again. If nothing else you'll be proving your affordability and owing less, and your credit history will have improved a bit.
    • zmblake
    • By zmblake 3rd Sep 18, 1:08 PM
    • 20 Posts
    • 9 Thanks
    zmblake
    I can see where you are coming from, I would like to get a debt consolidation loan however no-one will lend to me due to my debt to salary ratio. I would like a 10,000 loan over 4 or 5 yrs to pay off all my debt into one manageable monthly payment, I do not want to go down the route of a DMP as my credit rating is slowly recovering so I want to keep on improving it. Im struggling to pay for petrol / food at the moment.

    I even wrote to my bank to try and appeal their loan decision for me, and said that I would be happy for them to send the money to my debtors directly so I don't actually get the money myself (long shot, I know) and then close my accounts down. I have really learn my lesson with the credit cards and am determined not to open them again.

    I can understand where you are coming from totally.
    • Willing2Learn
    • By Willing2Learn 3rd Sep 18, 1:15 PM
    • 1,830 Posts
    • 1,412 Thanks
    Willing2Learn
    Yes it is understandable, the frustration you feel. But lenders have to look at affordability and your respective histories of managing credit. If they did not do that, they would be labelled "irresponsible lenders"...
    I work within the voluntary sector, supporting vulnerable people to rebuild their lives.

    I love my job

    • sourcrates
    • By sourcrates 3rd Sep 18, 1:58 PM
    • 15,879 Posts
    • 14,929 Thanks
    sourcrates
    I do not want to go down the route of a DMP as my credit rating is slowly recovering so I want to keep on improving it. Im struggling to pay for petrol / food at the moment.
    .
    Originally posted by zmblake

    Hi,

    You mention a DMP is not for you as you want to improve your credit score, then in the same sentence you say you cannot afford food or petrol.

    Sorry, but your priorities are all screwed up here, the solution is staring you in the face, yet you dismiss it out of hand in order to protect a made up number no one else ever see`s but you, also your actions with the bank wreak of desperation, no reputable firm will lend to you under those circumstances.

    A workable budget is essential to good living, your essential bills come first, all unsecured credit debts are non priority, and come last in line, what is left is your disposable income, and can be used to pay your debts with, if that means debt management, then so be it, time for the trees to see the wood.
    Last edited by sourcrates; 03-09-2018 at 3:00 PM.
    I'm a Board Guide on the Debt-Free Wannabe, Credit File And Ratings, and
    Bankruptcy And Living With It, boards. "I volunteer to help get your forum questions answered and keep the forum running smoothly".
    Board guides are not moderators and don't read every post. If you spot an abusive or illegal post then please report it to forumteam@moneysavingexpert.com. Any views are mine and not the official line of MoneySavingExpert.com.

    For free debt advice, contact either : Stepchange, National Debtline, or, CAB.
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    • foxy-stoat
    • By foxy-stoat 3rd Sep 18, 2:15 PM
    • 3,214 Posts
    • 1,815 Thanks
    foxy-stoat
    I can see where you are coming from, I would like to get a debt consolidation loan however no-one will lend to me due to my debt to salary ratio. I would like a 10,000 loan over 4 or 5 yrs to pay off all my debt into one manageable monthly payment, I do not want to go down the route of a DMP as my credit rating is slowly recovering so I want to keep on improving it. Im struggling to pay for petrol / food at the moment.

    I even wrote to my bank to try and appeal their loan decision for me, and said that I would be happy for them to send the money to my debtors directly so I don't actually get the money myself (long shot, I know) and then close my accounts down. I have really learn my lesson with the credit cards and am determined not to open them again.

    I can understand where you are coming from totally.
    Originally posted by zmblake
    Probably better to start your own thread but expect it to go the same way this one has.

    Consolidation is not the answer - you cannot borrow your way out of debt only repay it - look at the interest rates and see if you can make cuts to them by shifting the debt to intro rates, sell everything you can, down value the car, earn more money.
    • DCFC79
    • By DCFC79 3rd Sep 18, 2:52 PM
    • 33,128 Posts
    • 20,864 Thanks
    DCFC79
    Looks like lawero1 has decided not to come back and his account has changed to archived user.


    We just didn't provide the OP with the answers.
    Last edited by DCFC79; 03-09-2018 at 2:56 PM.
    • cajef
    • By cajef 3rd Sep 18, 3:38 PM
    • 4,873 Posts
    • 3,931 Thanks
    cajef
    We just didn't provide the OP with the answers.
    Originally posted by DCFC79
    Posters did but they just were not any of the ones they wanted.
    I used to have a handle on life, but it broke.
    • DCFC79
    • By DCFC79 3rd Sep 18, 5:06 PM
    • 33,128 Posts
    • 20,864 Thanks
    DCFC79
    Posters did but they just were not any of the ones they wanted.
    Originally posted by cajef

    Lol that's what I was alluding to.


    As usual the OP only wanted to see answers they believed were right.
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