Borrowing to finance CC Debt?

N

newbie2009

Registered User
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74
Hi all,

I am currently thinking about getting a small loan to cover two credit cards I have. I did run up a large balance on one of them, but still stayed well within my limit. I am currently paying approx 300pm on these cards, and rarely use them, only in cases of absolute emergency.

I looked into getting a loan from a few companies, I explained what the loan was for etc etc and that by giving me the loan I would be saving 300 approx per month - out of which the loan repayment would come, which worked out approx 150 per month.

I have a permanent job, and from my statements they can see that I am already managing the 300pm payment.

But the banks that i have approached have turned me down saying that they are not interested in financing another company's debt..

Any advice?

Thank you
 
Well, I wanted to explain to them, while they were looking at the bank statements, that the 300 that was coming out was no longer going to be an issue because the new loan would clear the CCs, and therefore the only DD coming out would be the loan.

Hope this makes sense?
 

While the above makes perfect sense, I suspect that any lending acency would adopt the stance that you may well run up the debt, or even a bigger one with the CC's again and also have the 150euro PM with them, to pay back.

You would be better off if you could show that you have 150euro PM disposable income and saying that the loan is for a car/kitchen/plastic surgery....etc.
 
Getting a loan is one of the recommended ways of clearing credit card debt. I've done it once or twice myself. And I always end up piling on the credit card again.
Why not look into transferring the debt to another credit card? Most off 6-9 months interest-free credit.
 
I have tried to move the CC balance to my own bank, but they refused to take it on because I had a referral fee for an unaurthorised overdraft (11e) 5 months ago, when a DD came out and there was a delay in my salary going through!

Im not sure what else to do .. maybe the credit union?

I had told both banks that I applied to that I would still need a credit card, and that I would apply for one of theirs, with a max limit of 500e..

I felt that there was no point in lying to them so I told them exactly what I wanted the loan for etc etc and all the necessary info around that... unfortunately this seems to have backfired...

Thank you for all your replies!
 
Well,

I had an appt with the credit union at 1.30pm today... and at 1.50pm today, I walked out with a cheque in my pocket!!

I explained everything to them, exactly like I did to each of the banks, and they said that they had no problem approving the loan!

I am saving with the credit union but didnt have the 1/3 that they usually ask for, I do have a standing order set up with my bank so that a set amount of money goes in each fortnight.

So Im increasing my SO by 50pf, and then putting 50% on the loan and 25% in savings!

I also asked if I could open a separate account and save a few euro there too, and they said no problem... so the last 25% is going into my new saving A/C (which is separate from the loan A/C, therefore I can access if I need to!)

Thank you Ms Credit Union!!
 
Congrats on getting the cheque, what you do now is lodge it into your bank account and then contact the credit card company asking them for a written settlement figure. If the bank and the credit card company are one and the same then lodge it somewhere else.

When you speak with them tell them that while you have no other debts, that you have significantly less income than when you took out the credit card and then ask them what the minimum amount is that they will accept.

Lay it on as thickly as possible telling them that out of the blue somebody may be able to come across with some money to get you out of a hole and that you just want rid of the card. Tell them that you could have a sum around 70% of the debt and ask them will they accept that as full settlement.

If they don't accept it tell them that as your income has dropped then you may not be able to meet the payments on the card but you don’t want to go into arrears.

You may get a reduction in the amount that you owe, then again you may not but it doesn't hurt to ask. What ever they agree make sure you get it in writing.
 
Mars39 said:
Why not say its for a new kitchen?
Click to expand...

SparkRite said:
... and saying that the loan is for a car/kitchen/plastic surgery....etc.
Click to expand...


Well done newbie2009 on sorting out your loan.

Just wondering why so many posters are encouraging the OP to lie?

Colndas, while I don't see a large problem with negotiating a reduced payment as a settlement - though personally I would prefer to repay my debts in full - why do you see it as advisable to lie through your teeth to do so?
 
so-crates said:
Just wondering why so many posters are encouraging the OP to lie?
Click to expand...


Eeeeeehhh..........And the banks never lie to us..........their customers??

For Gods sake, what difference does it make what you say to get the loan, if it means you get it?

You still have to pay it back!
 
so-crates fair point, we should not encourage people to lie. However, if you have an opportunity to bargain then do so. If the poster stated the amount of money that they had then no discount would be forthcoming.

jhegarty with regards to credit rating, if you get a settlement figure in writing then they cannot put that on the credit bureau. If the figure is below the loan amount that is for them to decide, it is not because of any default, it is because they were willing to accept a smaller amount in clearing a debt.

If, however, you miss payments then that will affect credit rating.
 

So the ICB have stopped marking accounted with an "L" code for settlements ?
 
jhegarty said:
So the ICB have stopped marking accounted with an "L" code for settlements ?
Click to expand...

All settlements below actually value outstanding are flagged on ICB and this will effect your ICB score / rating.


Just wondering why so many posters are encouraging the OP to lie?
Click to expand...

Eeeeeehhh..........And the banks never lie to us..........their customers??

For Gods sake, what difference does it make what you say to get the loan, if it means you get it?

You still have to pay it back!
Click to expand...
Lying in order to avail of credit usually means that the applicants does not qualify for the borrowing. Those who are less than truthful with the facts on an application for credit are typically the ones who come back on here at some point down the line complaining that they cant repay their debts, and moaning about how the banks over lent to them in the first place and so its all the banks fault....
 
In response to your question jhegarty, no they havent, but the person here is asking for a discount without previous credit issues. Different circumstances. Settlements are on the basis that the institution has been dealing with a delinquent account for some time.

I should not have used the term settlement but rather discount. If you are offered a discount on an account without previous delinquency then they cannot put that on the bureau.
 
Hi all,

Thank you for all your feedback! Im going to pay off the CC in full, and then throw a CC Burning Party!!!

Just as a matter of interest... re the banks lying to customers etc..... one of the banks I approached told me there was a problem with my credit rating and that I needed to wait a few years before applying again. I asked what the problem was, and they said that it was not their policy to discuss the details with the client!!

So I promptly went about getting a copy of my Credit Rating............. and it was perfect!! I even showed it to the accountant where I work, and they couldnt believe the bank's blatant lies!!!
 
Note of caution newbie2009 don't assume the bank was lying. If the addresses and name variants you submit are not exactly the same as those the bank submitted the ICB search will not return details. Even trivial differences will hide them from you, that was how I was puzzled/incensed that ICB did not, apparently, have my mortgage details on their records when clearly I was paying one. Turns out the bank had not used quite the same address as I had submitted to the ICB. What I am saying is that the ICB report you see comes with a health warning. It is only valid for the precise names and addresses you submit.

As for lying, morality may be unfashionable but honesty is fundamentally a moral obligation. It is also the basis of trust in any exchange. Dishonesty breeds distrust which ultimately and inevitably does harm. Whether non-disclosure (which is a more reputable negotiation tool) is a lie depends really on how you present or portray it.

Best of luck newbie2009, enjoy your CC-burning party and the satisfaction of repaying your debt at a more rational interest rate.
 
so-crates said:
As for lying, morality may be unfashionable but honesty is fundamentally a moral obligation. It is also the basis of trust in any exchange. Dishonesty breeds distrust which ultimately and inevitably does harm.....
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Agree with you 100% So-crates, and very eloquently put.

However there are lies and then there are LIES.

And I think saying that you want a loan for a kitchen (or whatever) and then spending the money on something else is hardly something I, and I presume most people, would not lie awake night after night worrying about.
 
Sorry sparkrite, I disagree. An explicit, verbalised lie is a lie. Whether it keeps you awake at night or not is pretty immaterial to the measure of falsehood.

What I think you are trying to convey is that you see it as a suitable ruse for changing the odds of your receiving the loan because you know their objections are in relation to your purpose rather than your ability to repay. It is still a lie.
 
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