Declined credit card - excellent credit score?

chris9393 · 14 March 2017 at 12:21PM

Hi,

I was wondering if I could get some advice from this forum. I was looking to apply for a new credit card, I currently own 2 at the moment, one which has been fully paid off and haven't used in about a year and the other with an outstanding balance of £1,500, however this is a 27 month 0% purchases card with another 16 months left. I've never missed a payment and currently have excellent credit score according to noddle.co.uk and experian.co.uk.

I used 3 different eligibility checkers online to get an idea of what credit cards were on offer all to which suggested a Halifax card with 0% interest on purchases for 30 months. I decided to go ahead and complete the online application only to then find out my application was rejected.

I'm currently 23 years old, been in current full time employment for 2 years with an annual income on £32,000. Still living at home with parents and no one financially dependant on myself.

The only 'debts' I have to my name is £1,500 on CC with another 16 months to clear it before interest and I own a car on finance which costs me £225 a month. Other than that, I'm managing to save between £800 - £1000 a month. If it helps I'm also on the electoral role.

I'm about to fill out an appeal letter to which I will send off to halifax however I was wondering if anyone had a rough idea as to why I would of been rejected?

[Deleted User] · 14 March 2017 at 12:27PM

Credit isn't issued on the basis of credit scores. It's all based on lenders' criteria.

Have you checked the data on all three of your files? And how much is the car?

PeacefulWaters · 14 March 2017 at 1:17PM

How recent was the car loan?

How much is the car loan?

What's your existing relationship with Halifax?

Do you pay above minimum payments on your existing cards?

TheShape · 14 March 2017 at 1:20PM

As well as answering the questions above, who issued the other two cards, and what are the credit limits?

chris9393 · 14 March 2017 at 2:00PM

Deleted_User wrote: »

Credit isn't issued on the basis of credit scores. It's all based on lenders' criteria.

Have you checked the data on all three of your files? And how much is the car?

I understand that it's not based solely on the credit score. I haven't properly ready through my files as such yet but will check later on this evening when I have more time.

The total cost of my car is £22,900 to which I am paying off £225 a month for 36 months. When the 36 months is up I will look at buying the car out right.

PeacefulWaters wrote: »

How recent was the car loan?

How much is the car loan?

What's your existing relationship with Halifax?

Do you pay above minimum payments on your existing cards?

I used to own a current account with Halifax however I switched over to First Direct. I do however have an Help to Buy ISA which I pay into monthly and have a credit card with halifax which has been fully paid off and I haven't used it in about a year. Before applying for the new credit card, I tried to close my old card with halifax however they advised me to apply online first and close it once the application was successful.

TheShape wrote: »

As well as answering the questions above, who issued the other two cards, and what are the credit limits?

One card with Halifax which has been fully paid off and another with The Post Office. At the moment, due to the long 0% APR with on the post office account, I am currently paying the minimum however some months I do pay above.

TheShape · 14 March 2017 at 2:06PM

And the credit limits?

PeacefulWaters · 14 March 2017 at 2:06PM

Your unsecured debt is huge compared to your salary.

I'd suggest that's the reason why you've been declined.

chris9393 · 14 March 2017 at 2:14PM

TheShape wrote: »

And the credit limits?

£2000 on the Halifax
£3000 on the Post Office

PeacefulWaters wrote: »

Your unsecured debt is huge compared to your salary.

I'd suggest that's the reason why you've been declined.

I wouldn't of thought that would of been an issue considering I can comfortably afford to pay off the monthly instalments of the car. Once the 36 months is up I can then either walk away, buy the car or trade it in for a new on. Buying the car outright is the option I am swinging towards at the moment.

PeacefulWaters · 14 March 2017 at 2:34PM

Your unsecured debt is pretty close to your annual take home pay.

It's not the monthly payment that worries them it's the size of the balance outstanding.

I assume you have a plan to significantly reduce the debt in the face of a rapidly depreciating asset ...

eskbanker · 14 March 2017 at 2:52PM

PeacefulWaters wrote: »

Your unsecured debt is pretty close to your annual take home pay.

It's not the monthly payment that worries them it's the size of the balance outstanding.

I assume you have a plan to significantly reduce the debt in the face of a rapidly depreciating asset ...

The way I read OP's clarification is that they don't actually own the car as stated in earlier posts but lease it, so the total £22.9K value of the car itself shouldn't be seen as a debt, 'just' the 36 month £8.1k commitment....

chris9393 wrote: »

Once the 36 months is up I can then either walk away, buy the car or trade it in for a new on.

JimmyTheWig · 14 March 2017 at 2:55PM

eskbanker wrote: »

The way I read OP's clarification is that they don't actually own the car as stated in earlier posts but lease it, so the total £22.9K value of the car itself shouldn't be seen as a debt, 'just' the 36 month £8.1k commitment....

But what do the credit files say?

Declined credit card - excellent credit score?

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