Credit card application when mortgage & rent consume 85% of income.

Gogo82 · 3 January 2018 at 2:06PM

Hi,

NatWest soft check tells me I have 9/10 chance for a credit card, which should be great, if not for the fact that I don’t trust this prediction.

At present I’m paying rent in the UK and mortgage overseas and covering my share of those expenses leaves me with 15% (around 380 pounds) of my UK income left for day-to-day expenses (I'm dipping into my savings). My mortgage is with an overseas bank so Natwest cannot see those, but I have decleared all the overseas expenses in the credit card elegibility check.

The reason I'm applying for a CC is that we are selling the overseas property and planning to take out a low LTV mortgage in the UK. I've been back in the country for 6 months now, with a full time job and already on the electoral roll.

Am I right to disbelieve the 9/10 chance of getting a credit card or am I being to pessimistic? Do banks/lenders make further inquiries in situations like these or do they not bother with such minutae?

Many Thanks for advice,

[Deleted User] · 3 January 2018 at 2:25PM

What's your income?

Gogo82 · 3 January 2018 at 2:31PM

42k, min requirement in bank is 10k

[Deleted User] · 3 January 2018 at 2:43PM

Why are you worried?

At the worst you'd have 1 hard search on your credit files

Gogo82 · 3 January 2018 at 2:54PM

@!!! -- so one hard search would not be problematic? Assuming I get rejected, how long should I wait for another application? 2-3 months? By April my budget will have improved because the house will have been sold by then :0)

bazzyb · 3 January 2018 at 3:19PM

9/10 means you've still got a 10% chance of being rejected, regardless of your income.

It's difficult to say without completing a full application, some lenders pay little attention to affordability, some will look purely at capacity (i.e. income) versus what commitments they can see on your credit file, whereas some will look at 'true' affordability ie taking into account all outgoings. Every lender has a different internal scoring profile - if you're showing high eligibility on their checker then one would assume you have scored highly on their internal system and have good chance of an auto acceptance - but it is not 100% guaranteed.

[Deleted User] · 3 January 2018 at 3:49PM

Any particular reason you are using NatWest?

There are others out there as well - have you used any other eligibility checkers, such as the MSE one?

Gogo82 · 7 January 2018 at 1:12PM

Gary -- I've had a current account with NatWest since 2007 so I assumed this may make things easier as they know me.

In either case I have filed a CC application giving them my mean incomings and outgoings from 2017 and was refused, so I think I need to wait a bit more to build up trust with the bank.

MSE and ClearScore don't want to let me into their system -- both require 3 years of UK address history. I only managed to register and see my data directly with Experian and Noddle.

Gogo82 · 20 January 2018 at 4:29PM

Update: In the end I did receive the CC that I applied for.

After the bank sent me a rejection letter I called their office to ask for advice and an explanation of reasons for the rejection. The reason was indeed my stated income to expenditure ratio. However, after I explained my situation, higlighted the saving that I have on the account, and argued that the reason for applying for a CC is to take out a low LTV mortgage in a while, and that the rent & mortgage expenditures are shared with my husband, the initial decision was overruled -- without much fuss at all.

Conclusion: always worth following up on a rejection.

Credit card application when mortgage & rent consume 85% of income.

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