Why is it I can get different credit cards with reasonable credit limits but I cant get a personnal loan?

Question

Ive been bringing up 2 children by myself and have got a bit into debt on credit cards. Now when Im looking for a loan to clear these debts no one wants to know. Im not working and live in rented house, so where do I turn to for help?

Answer 1

Borrowing more to get out of debt is never the answer. Go to a reputable credit management company and have them work with your creditors so you can pay them off. Some time local credit bureaus do that. If that doesn't work you could file a Ch 13 bankruptcy, have up to 5 years to pay, the interest stops on the credit cards. At the end your credit rating is fairly good, if you finish.

Answer 2

Have you tried a credit union? They are more open to approving personal loans for debt consolidation. Also, call your credit card companies and ask if A) they can give you a lower rate, or B) they can give you a good rate for balance transfers. Then transfer higher balances to that card.

I cannot imagine not working and having to raise two children. I am so sorry to hear you are going through this. Do you have friends or family that can help?

Also, go to www.creditboards.com/forums. You can get a lot of great ideas and support there.

Hugs!

Answer 3

First and foremost, cut up the cards and never use them again. Ring the credit card companies and ask them to freeze the interest, or at least reduce it. If you're only making minimum payments on the cards, the debt will mount up incredibly fast.
Next, you have to get some kind of job to increase your income. Think about babysitting/childminding in your own home, or see if you can get friends or family to babysit your two to let you get out to do a few hours work. Put every penny you earn towards the debt.
Summer is coming, Christmas after that, birthdays and other things will all tempt you to use the cards - don't do it.
Good luck.

Answer 4

that 'no one' is willing to extend you further credit should be a big red flag to you.

you need to cut spending hard and pay down your credit cards.

***
I'm well aware that all too many absentee fathers are deadbeats. Call them anyway if their payments are in arrears because you need the money soonest. In fact, call them even if their payments are timely -- they have a vested interest [their children] in your budget balancing.

***
Btw, most banks and many other lenders no longer do small personal loans. They've been replaced by the credit card.

That's because the bank already has the mechanism for the credit card set up and operating as cheaply as possible. So they add volume to their cheap operating system instead of an expensive one (personal loans).

Besides, they can always hope that you'll use the credit card a bit more and keep your balance higher than you planned -- which makes more money for them.

:-)

Oh.

[ex-banker]

Answer 5

Credit cards are easy to get because you pay high interest rate, up to 21%. An unsecured loan is more difficult to get especially when you were already in trouble.

Debt management program is your best choice, if you can afford it. Bankruptcy is your last choice. If you have a bankruptcy record, you could be prevented from certian jobs, lawyer and chartered accountant/certified accountant are some of them.

Answer 6

Because credit card companies WANT you to run up debt with them so they can charge you exorbitant interest and hound you for the rest of your life. Reputable lenders do not.