Debt consolidation loans

If the loan is not going to be used for debt consolidation then best not to say that some or all of the proceeds will be used for this purpose.

An important part in the approval process for many lenders is affordability. Before paying out / completing a loan a lender needs to be happy that you can afford to make the loan repayments. Lenders have different ways of calculating affordability and different criteria. One way that most people are familiar with is the affordability calculations for a mortgage. For example 3 times single income or 2 times joint.

The lenders will deduct from an applicant’s income existing credit repayments that are not being cleared by the loan that they are arranging.

It is a popular misconception that if payments are not met on a secured loan but your mortgage is up to date, the lender cannot repossess your home.

The facts are that if your loan payments fall far enough behind, the lender will take you to court and your Mortgage lender will have no choice but to support the loan lender and jointly take proceedings. This can be avoided if your situation changes for the better.

If you do fall behind with payments, treat the situation exactly as you would with mortgage arrears and follow the advice we have given before. Contact the lender, make realistic proposals and do be honest about your situation.

They can only help you if you help them