Loan...

Shep_Cobain

Shep_Cobain

Shep_Cobain

Soldato
Joined
26 Feb 2007
Posts
3,322
Location
Blackpool
Alright people,

2 and half years ago i took out a loan with my bank of 10+ years (HSBC) - i am currently paying this off and have another 2 and a half years to go. I pay £229.00 a month and my settlement figure is £5,700.

In march last year me and my girlfriend decided to get a car together. It was a brand new one from Citroen on a hire purchase agreement. We have the car for 3 years but can return it at any point and stop the agreement. The vehicle is in my name and costs £160.00 a month. Me and my girlfriend decided we both needed a vehicle so she decided to set up a direct debit to my account paying the £160 each month for the Citroen.

I decided it would be best to get myself a car. IT costs me £10,000 on finance. I pay £225 a month and bought the car in september 2010. My settlement figure is £9300. I don't use the car often enough so i have decided i want to pay it off using a loan and sell it privately and get a run around.

That totals at £454 a month... i earn £943 a month after tax and pension etc.

If i take out a £15,000 loan at 7.4% over 5 years i can get my repayments down to approx £297saving me over £150 a month.

My girlfriend has no credit history nor is she on the electoral roll. She has an O2 mobile contract set up in my name and she has a direct debit set up for that and i have an O2 contract setup aswell which is also direct debit.

I have never ever missed a payment for anything so my credit score is good, however i applied for a Tesco loan last night as a joint application and i was declined.

Do you think this will be the case at most lenders or is it because my girlfriend has no credit history and i should have applied on my own?

I have a meeting with HSBC tomorrow afternoon but on their website and over the phone they were quoting me 14.9% apr!

If it would help a kind family member has offerend to lend me £10,000 to pay a part of the debt off to see if it would be easier to get a loan. But if i still couldnt get a loan then i wouldn't be able to pay them the £10,000 back causing all sorts of problems.

Any help would be greatly appreciated!

Thanks guys
 
lol. Just the response i was expecting.

At the end of the day i am and have always been comfortable with this debt. I can still live and pay off these outgoings. I would rather pay £300 a month out on a nice car etc than drive around in an old car which could have a terrible history and cause me a lot of hassle down the road.

I paid for PC components outright and buy and sell a lot on eBay which covers costs for the lifestlye i have. However this can't be proven as an extra income as it isnt always guarenteed.

Now my original idea was to reduce my monthly repayments of £454 to £300 a month by taking out a loan with a lower apr. But you financial advisors think this is a bad idea and i should continue paying out £150 extra a month for 5 years and get rid of my debt this way.

Love it! Sounds like an awesome idea :D
 
im reducing my monthly repayments by £150 a month. Then in 2 years time when i will be on approx double my current salary i will be in a better situation to look at paying off the loan in a lump sum.

I say this because with my current job i will be on £24k - £28k in 2-3 years time. This is because i am in training for another 1.5 years and my wage increases each year by approx £2k. After the training has completed my wage will nearly double putting me in a better financial situation.

However, i am comfortable with the outgoings i pay now and never struggle nor do i miss payments. Some people like to live more than others hence my lifestyle. I wouldn't be surprised if half of the people in this forum save 40 years to buy their house outright or 3 years to buy a brand new car...
 
[TW]Fox;18264726 said:
I'm going to be mega blunt here because you deserve it after that pathetic post.

Wake up and smell the coffee.

You cannot afford to live it up in brand new cars with high end computers. You dont earn enough money - you dont have a good enough job.

Your lifestyle is a sham, it's based on ever increasing credit and you have no right to live it the way you do. The people having a go at you are not people who save for 40 years to buy a house or people who buy cars outright - they are people who live within their means and earn more money than you.

If you want the new cars and the nice PC then get a better job, not a bigger loan. You are everything that is wrong with the financial society in this country. Everything.

When are you going to learn you can't just 'live more than others?'

And to be honest mate, 'living more than others' in most peoples book doesnt involve buying a £500 graphics card or financing the purchase of a totally crap brand new Citroen.

Reality check time. Get rid of the cars. Sell your overpowered PC. Live within your means. There is nothing wrong with using loans to buy things you want provided you have the income and at barely 900 quid a month, you quite clearly do not.
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mate. Do you read anything anyone puts?

I have debt which i am comfortable with. My girlfriend pays for her car and phone bill. IF we split up the car can just be sent back to Citroen as it is on a PCP loan which can be cancelled at anytime. The phone is a month by month rolling contract so can be cancelled straight away.

With regards to my car, i pay more than double the apr i should be and i jumped into it without thinking. I can't legally sell the car as it is financed and i can't give it back either. I have to have it for at least 3 years before i can do that. So if i pay it outright with a loan i can then sell it privately for £9000, take the cash and use that to pay off some of my debt!

You say dont take out another loan?!?!? But i have my car for 5 years anyway so if i take out another loan for 5 years and reduce my payments it makes no difference!!!!!

Some people on here are utter trolls. You say i need to learn a few lessons, i think some of you need to realise we arent all the same and maybe you wouldnt be comfortable with the debt but i am. As for my pc spec you all keep mentioning. I bought that using cash from my eBay buying and selling!
 
OllyM said:
I thought usually PCP's were harder to terminate early than other types of finance because the balloon payment means the 'half way point' (when half of the total amount borrowed) could be nearly at the end of the agreement?
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That may be the case but with Citroens Elect 3 Finance you can give it back at any time and its a simple process. You just need to keep it for a minimum of 3 months. My uncle had one but took it back when he was getting a mortgage and there were no problems etc.
 
MOOGLEYS said:
Live to your means dont get more debt its never the answer. The advice people have given is good try and pay back your debt and then move on from there. You dont need new cars get older functional cars and put the money saved into paying off the debt. You say it doesn't bother you but it should. I have only just bought my first new car and have been in the RAF 16 years this year and earn a decent wage. I had to put 5K on a credit card but it will be paid within the interest free period and its the only debt i have..
Re-asses your finances and work out your priorities before getting more debt to pay debt. the only people winning are the banks.
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If i don't refinance now the only people are winning is the car finance company i used to buy my car! I rushed into it and wish i could turn back time. I have over 4 and a 1/2 years left to pay £225 a month or i could refinance reduce my overall finance by £150 a month and sell the car for £9000 and have that in the bank. Use that £150 a month to save up and pay of the loan earlier. Hopefully in 2 and a half years (the time i have remaining on my current HSBC loan) i can save up the rest and completely wipe off the debt.

So the question is... which is better?

£454 a month for 2 and a half years
or £297 for 2 and a half years....
 
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DiCe! said:
I agree not everyone is the same, some people can pull their heads out of their ass and see that while you are "comfortable" with that debt it is not an "acceptable" level of debt, especially in todays climate.

I went to uni only loan i had was £3.5k, i had two credit cards at £500 each and i had an overdraft of lets say £1500. so a grand total of £6k debt after uni which isnt much by todays standards i know, but that kept me awake at night. I could have cried DADDY but thats not who i am. i limited myself to only going out once a month, when i got a tax rebate instead of going to uber PC i put all of it on credit cards and cleared them. I quit my dead end job and got one where i earn more and have potential to get somewhere, i set up direct debits so that as soon as im paid the money si gone to the debt and i never even see it. 1 year later im on my last £500 and that will be gone at pay day this month.

I get that you are "comfortable" but it is only 1 step from comfortable to irritable bowel syndrome.
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lol your clueless.

I havent cired "daddy" and won't do unless i was made redundant which touch wood isnt going to happen as the business i am in and intend to be in for the rest of my life is booming!

I have a pay structure which by year 4 i will be on £24,000 - £28,000. I don't lie awake at night worrying and i very rarely go out. In my life i have had credit cards and have always paid them off on time and comfortably.

I never maxed out anything to pay for my PC as i keep saying. I bought that, my LCD TV, Surround Sound Speakers and Amp, Furniture, Geckos, Fish Tank, Python etc. all with cash!
 
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DiCe! said:
Id like to get your comment printed off and framed, then smash it over your head when the bailiffs come for your cars/possessions.

Ignore the sound advice, get another loan, hell get another car for your pet dog and live the "high life and live a little"

cant put into words the level of stupidity on show here.
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isn't going to happen pal...
 
DiCe! said:
cinema isnt cheap
eating out isnt cheap
booze isnt cheap

either way you look at it its still money you dont have going on things you dont need.
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i can afford that now with my current £454 a month debt. Amazes me people say don't do it and what if you lose your job... what about mortgages etc...
 
[TW]Fox;18269357 said:
Not many people on £15k a year are going to have a pension contribution so huge that it knocks take home down to 900 quid. Besides, does this guy really strike you as the sort to have a high contribution pension on the go?

He just isnt paid very well, yet thinks he should have all the lifestyle accessories of a higher salary.
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What the hell do you know about me pal? You sit there with your internet cloak on posting ridiculous and pointless comments!

Ill have you know i am in an industry which will never die due to the world we live in and the need for it now and even more so in the future! I can't disclose what it is but trust me its here to stay. I am in training for 3 years and my wage increases £3000 each year. I receive a bonus of £2000 ever April and after year 3 my salary rises to £24,000 - £28,000 depending on my knowledge and how well i have progressed. After that wage increases happen each year at £4000 a go providing you meet your targets set in your review.
 
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