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    • SallyJean
    • By SallyJean 9th Nov 17, 10:01 AM
    • 2Posts
    • 0Thanks
    SallyJean
    Zopa loans - high interest rate?
    • #1
    • 9th Nov 17, 10:01 AM
    Zopa loans - high interest rate? 9th Nov 17 at 10:01 AM
    I used the Zopa tool to calculate your likely interest rate without harming your credit score. Their advertised representative rate is as low as 2.8. I was given an estimate of around 20%!! I have a good credit rating (checked this recently) and can't see why it would be so high. I recently applied for a Sainsbury's loan and they offered me 5% - not sure whether applying again so soon after would affect their scores?? I am basically wanting to consolidate debts totaling 13,000 (includes a career development loan of 10,000). Any advice would be appreciated!! Thank you
Page 1
    • zx81
    • By zx81 9th Nov 17, 10:03 AM
    • 14,063 Posts
    • 14,755 Thanks
    zx81
    • #2
    • 9th Nov 17, 10:03 AM
    • #2
    • 9th Nov 17, 10:03 AM
    Different lenders have different risk criteria. None of these criteria include a CRA's credit rating of you.

    People looking to consolidate are naturally higher risk. If you've been offered 5%, and that is lower than your current rates, I would accept it.
    • StopIt
    • By StopIt 9th Nov 17, 12:00 PM
    • 1,380 Posts
    • 1,169 Thanks
    StopIt
    • #3
    • 9th Nov 17, 12:00 PM
    • #3
    • 9th Nov 17, 12:00 PM
    I used the Zopa tool to calculate your likely interest rate without harming your credit score. Their advertised representative rate is as low as 2.8. I was given an estimate of around 20%!! I have a good credit rating (checked this recently) and can't see why it would be so high. I recently applied for a Sainsbury's loan and they offered me 5% - not sure whether applying again so soon after would affect their scores?? I am basically wanting to consolidate debts totaling 13,000 (includes a career development loan of 10,000). Any advice would be appreciated!! Thank you
    Originally posted by SallyJean

    Ignore the score.


    You can't see the reason why Zopa offered you 20% and Sainsbury's 5%, but you can check your credit history to make sure nothing untoward is there.


    There are 3 different CRAS and you can check all 3 for free:


    ClearScore covers Equifax
    Noddle covers CallCredit
    MSE Credit Club covers Experian.


    It may be that each lender used a different CRA and there's something bad on one of them.


    It also be differing lending standards as each lender varies.


    Debt consolidation loans are usually higher APR because the lender cannot assume that you'll use the money as intended, so have to base the affordability on the total debt, not just the loan in question.


    5% is a good rate, why did you not take it? Can you still do so?
    I'm a Board Guide on the Debt Free Wannabe, Credit Cards and Loans boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Any views are mine and not the official line of moneysavingexpert.com. Board guides are not moderators. If you spot an inappropriate or illegal post then please report it to forumteam@moneysavingexpert.com

    In debt and looking for help? Look here for the MSE Debt Help Guide.
    Also, If you need any free and impartial debt advice, the National Debtline, Stepchange, and the CAB can help.
    • SallyJean
    • By SallyJean 9th Nov 17, 2:00 PM
    • 2 Posts
    • 0 Thanks
    SallyJean
    • #4
    • 9th Nov 17, 2:00 PM
    • #4
    • 9th Nov 17, 2:00 PM
    Thank you both - that's really helpful Yes I am thinking I may accept the 5% loan from Sainsbury's. I just wondered why I didn't get the 2.8 - just trying to get it as low as I can really. I heard from a friend that they only give the 2.8 rate to about 50% of applicants though, so perhaps 5% is the best I am going to get!
    • DCFC79
    • By DCFC79 9th Nov 17, 2:23 PM
    • 30,273 Posts
    • 19,151 Thanks
    DCFC79
    • #5
    • 9th Nov 17, 2:23 PM
    • #5
    • 9th Nov 17, 2:23 PM
    Thank you both - that's really helpful Yes I am thinking I may accept the 5% loan from Sainsbury's. I just wondered why I didn't get the 2.8 - just trying to get it as low as I can really. I heard from a friend that they only give the 2.8 rate to about 50% of applicants though, so perhaps 5% is the best I am going to get!
    Originally posted by SallyJean
    Maybe because Zopa see you as a risk since it's the money of other savers involved.

    Accept the 5% now.
    Can people stop loaning money/being a guarator to family/friends, it rarely ends well and you lose out as your money is gone or you get shafted with being a guarantor.
    • StopIt
    • By StopIt 9th Nov 17, 2:30 PM
    • 1,380 Posts
    • 1,169 Thanks
    StopIt
    • #6
    • 9th Nov 17, 2:30 PM
    • #6
    • 9th Nov 17, 2:30 PM
    Thank you both - that's really helpful Yes I am thinking I may accept the 5% loan from Sainsbury's. I just wondered why I didn't get the 2.8 - just trying to get it as low as I can really. I heard from a friend that they only give the 2.8 rate to about 50% of applicants though, so perhaps 5% is the best I am going to get!
    Originally posted by SallyJean

    Close.


    They give 2.8% to 51% of all successful applicants. Not 51% of all people who apply. So 49% of people who get accepted for a Zopa loan will not get that rate.


    Alas, it's asking why the trains never run on time. It depends on who you ask, no answer is ever really satisfactory and the trains still don't run on time.
    I'm a Board Guide on the Debt Free Wannabe, Credit Cards and Loans boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Any views are mine and not the official line of moneysavingexpert.com. Board guides are not moderators. If you spot an inappropriate or illegal post then please report it to forumteam@moneysavingexpert.com

    In debt and looking for help? Look here for the MSE Debt Help Guide.
    Also, If you need any free and impartial debt advice, the National Debtline, Stepchange, and the CAB can help.
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