GF wants loan - offered APRs higher than adverts
Discussion
GF has an Audi A1 on HP at 181 a month for the next 4 years (1 year paid off). She is also paying off the last few hundred of her Invisalign. Never missed a payment on anything. Also has a small mortgage on a flat. Earns around 35k as a civil servant (though only in post since Dec 22).
The HP is on 12% APR and not sure about the Invisalign. But when I found out I went mad about the APR
- it was done well before meeting me. She's agreed that getting a personal loan to clear it all off at a lower % APR is a good idea to save her money in the long term and she can comfortably afford it on a month-to-month basis.
Lots of sites offering personal loans at 5.5% ish, but then when she goes through the system she is offered 10/11% APR. I know it's dependent on the individual and have been through this myself, but as someone who has little debt and a reasonable salary with no missed payments I did not expect it to be double the advertised rate.
Anyone got any advice? There's no point shifting from 12% to 11.something clearly. Could P2P lending be an answer? I want to get her paying like 7% max - it'll save her about 1500 quid over the term.
If it helps, I don't mind acting as a guarantor and I earn more than her.
Help appreciated!
The HP is on 12% APR and not sure about the Invisalign. But when I found out I went mad about the APR
- it was done well before meeting me. She's agreed that getting a personal loan to clear it all off at a lower % APR is a good idea to save her money in the long term and she can comfortably afford it on a month-to-month basis. Lots of sites offering personal loans at 5.5% ish, but then when she goes through the system she is offered 10/11% APR. I know it's dependent on the individual and have been through this myself, but as someone who has little debt and a reasonable salary with no missed payments I did not expect it to be double the advertised rate.
Anyone got any advice? There's no point shifting from 12% to 11.something clearly. Could P2P lending be an answer? I want to get her paying like 7% max - it'll save her about 1500 quid over the term.
If it helps, I don't mind acting as a guarantor and I earn more than her.
Help appreciated!
Usually the representative APR has to be offered to at least 51% of applicants, I believe.
The only thing to do is shop around (Moneyfacts is good for this), preferably using sites that offer eligibility checkers that won't affect your GF's credit score.
She also needs to take into account any interest penalties if she settles her HP agreement early. Has she got a settlement figure yet?
PS: My advice would be to avoid putting yourself forward as a guarantor. I'm sure that your relationship is absolutely solid and it'll remain so for the duration of the new loan. But you never know...
The only thing to do is shop around (Moneyfacts is good for this), preferably using sites that offer eligibility checkers that won't affect your GF's credit score.
She also needs to take into account any interest penalties if she settles her HP agreement early. Has she got a settlement figure yet?
PS: My advice would be to avoid putting yourself forward as a guarantor. I'm sure that your relationship is absolutely solid and it'll remain so for the duration of the new loan. But you never know...
C69 said:
Usually the representative APR has to be offered to at least 51% of applicants, I believe.
The only thing to do is shop around (Moneyfacts is good for this), preferably using sites that offer eligibility checkers that won't affect your GF's credit score.
She also needs to take into account any interest penalties if she settles her HP agreement early. Has she got a settlement figure yet?
PS: My advice would be to avoid putting yourself forward as a guarantor. I'm sure that your relationship is absolutely solid and it'll remain so for the duration of the new loan. But you never know...
Yeah, obviously I'd avoid it if I could, but if it meant a massively different rate then it'd at least be a consideration. Settlement is around 6.7k, but full term it's 8.5k. Will try Moneyfacts now The only thing to do is shop around (Moneyfacts is good for this), preferably using sites that offer eligibility checkers that won't affect your GF's credit score.
She also needs to take into account any interest penalties if she settles her HP agreement early. Has she got a settlement figure yet?
PS: My advice would be to avoid putting yourself forward as a guarantor. I'm sure that your relationship is absolutely solid and it'll remain so for the duration of the new loan. But you never know...
Sheepshanks said:
spud___ said:
...as someone who has little debt and a reasonable salary!
Not sure if serious?And doesn't sound like you've known her very long to be acting as guarantor.
paulrockliffe said:
When can the mortgage be renewed? It's likely that the cheapest approach is to load it onto the mortgage if possible.
Understand that, though I'd like to keep that the two separate for nowspud___ said:
Froomee said:
Some credit cards offer a cash transfer at competitive rates. 0% for a year for 3% fee or 3.9-4.9% APR over 2 years, etc.
My partner is with Lloyds and she had these available until very recently.
Will see if that's an option! Hadn't thought of that one. ThanksMy partner is with Lloyds and she had these available until very recently.
Don’t know why you can never get the advertised rate, I applied for a Tesco loan, 3.4% last year and they wanted to give it to me at 15% wtf?
I have found a company called Novuna to be good in the past and gave me the advertised rate twice.
spud___ said:
Both parts of this are just plain rude. I'm not quite sure which bit you're being so condescending about. but she has little debt, the salary of 35k is reasonable for the North, and your snobby judgement in the final line is just pathetic. See the post I've quoted just above yours for how to make the same point as you wanted to make but without coming across as a complete see-you-next-Tuesday.
It reads like a lot of debt vs salary. Mortgage plus two other loans. No student loan? Is she running the flat? She can't have much disposable income left from £35K gross. So her loan application is going to look pretty iffy. Has she made a few applications? That can mess things up. I'm sure everyone says they're going to settle the existing loans.Sorry if you thought my final comment was rude, but, again, it reads that you've only known her for a few months. I said just the same as the other poster, just used fewer words.
Edited by Sheepshanks on Thursday 29th June 21:09
C69 said:
Usually the representative APR has to be offered to at least 51% of applicants, I believe.
The advertised rate must be genuine or the ASA wouldn't allow it. Perhaps they invented the 51% figure?https://www.asa.org.uk/make-a-complaint.html
ridds said:
Check if the Interest is front loaded or not.
If it is, then there is zero point moving it. She'll just be adding more interest to previous 12%.
Proper front loaded interest is the stuff of loan sharks. It’s been illegal for regulated agreements under the Consumer Credit Act for years.If it is, then there is zero point moving it. She'll just be adding more interest to previous 12%.
Hopefully the OP has taken account of settlement periods - if replacing one loan with another it does mean there will be up to a couple of months worth of duplicated interest payments.
spud___ said:
The current balance to pay is around 8.5k but the settlement figure is about 6.7. So I'm wanting to save as much of that 1800 as possible.
If you're applying for 6.7k this could be it - some lenders seem to only offer the best rate for 7.5k+If so, you could apply for 7.5k then overpay the £800 straight away, pretty sure halifax/lloyds do this and also offer zero fee overpayments
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