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  • FIRST POST
    • Killacam
    • By Killacam 10th Mar 17, 11:46 PM
    • 8Posts
    • 1Thanks
    Killacam
    Help with Personal Loan
    • #1
    • 10th Mar 17, 11:46 PM
    Help with Personal Loan 10th Mar 17 at 11:46 PM
    Im 22 years old and have a relatively good credit history, not had a late payment in around a year our two. I am getting my first car and need a loan of around 6-7 thousand pounds.

    I applied to sainsburys and got a shock when I was declined.

    I have looked at my credit file and I'm down 165 points, due to too many applications and checks from comparison websites, there is so many checks on my file

    I recently got a few items on finance, which I can comfortably pay back.

    I now am facing a dilemma, as I want to apply to Tesco as they have a higher acceptance rate but I'm just a bit worried, my history is pretty clean but just unsure of where to go from here, any help is appreciated!!
Page 1
    • Killacam
    • By Killacam 11th Mar 17, 12:00 AM
    • 8 Posts
    • 1 Thanks
    Killacam
    • #2
    • 11th Mar 17, 12:00 AM
    • #2
    • 11th Mar 17, 12:00 AM
    I am also in full time employment at a Finance Company.
    • KoshB5
    • By KoshB5 11th Mar 17, 5:21 AM
    • 42 Posts
    • 21 Thanks
    KoshB5
    • #3
    • 11th Mar 17, 5:21 AM
    • #3
    • 11th Mar 17, 5:21 AM
    Quotation (eligibility) searches are soft searches and aren't seen when applying for credit. Without kmowimg your personal circumstances and knowing the lenders criteria (credit / affordability scoring) and business model it is difficultt to say why you have been rejected. The CRA score is a generic credit score that factors in the things that are considered within a lenders own credit score, it can't predict how a lenders score will asses you. As many on this forum will tell you a lender looks at your credit file data and not the CRA score.

    Because you've been rejected by one lender doesn't mean you will be rejected by another. If you have opened (or applied and been unsuccessful) for many new accounts in a short period of time this will impact any credit score negatively. Opening new accounts means that there is no associated history on how you are managing them. The more history you have the better you can be assesed to determine the risk of doing business with you, so this May well be the reason you've been rejected. If this is the case then time will come to your aid as your file gains more history showing good account management, though you may still fall foul of affordability scoring.

    Whilst this link is from the US - http://www.myfico.com/credit-education/whats-in-your-credit-score/ , it will give you a good view of how a credit score is generated. The UK and US operate CRA's and credit checking in very similar ways.
    Last edited by KoshB5; 11-03-2017 at 6:23 AM.
    • Dobbibill
    • By Dobbibill 11th Mar 17, 6:58 AM
    • 2,038 Posts
    • 3,151 Thanks
    Dobbibill
    • #4
    • 11th Mar 17, 6:58 AM
    • #4
    • 11th Mar 17, 6:58 AM
    Im 22 years old and have a relatively good credit history, not had a late payment in around a year our two. I am getting my first car and need a loan of around 6-7 thousand pounds.
    Originally posted by Killacam
    You have at max 4 yrs of history.

    You have had no late payment for a year or two? Does that mean you did have late payments before that? If so only 50% of your history is good.

    I applied to sainsburys and got a shock when I was declined.
    Don't be shocked - their criteria is never revealed so you don't know if you meet it.

    I have looked at my credit file and I'm down 165 points, due to too many applications and checks from comparison websites, there is so many checks on my file
    As said, comparison websites leave soft searches on your file, lenders don't see soft searches though.

    Take no notice of your points.

    I recently got a few items on finance, which I can comfortably pay back.
    If you've recently taken items out on finance then there will be limited history. Depending on how recently will depends whether you are being perceived as 'desperate for credit'.

    I now am facing a dilemma, as I want to apply to Tesco as they have a higher acceptance rate but I'm just a bit worried, my history is pretty clean but just unsure of where to go from here, any help is appreciated!!
    Set your sights on a cheaper car, save for it - maybe using the money you were going to use for the loan, especially if it's your first car. You will have knocks and prangs - it will hurt less if it's a car that cost you £2k as if it cost you over £5k.
    • Gambler101
    • By Gambler101 11th Mar 17, 7:27 AM
    • 180 Posts
    • 372 Thanks
    Gambler101
    • #5
    • 11th Mar 17, 7:27 AM
    • #5
    • 11th Mar 17, 7:27 AM
    Just a thought OP, if you have had to take out finance recently for "a few items", then you are already living beyond your means and need to cut back your spending. Getting a car loan would be madness until you spend less than you earn and start saving up for your car.
    • ViolaLass
    • By ViolaLass 11th Mar 17, 7:31 AM
    • 4,860 Posts
    • 6,703 Thanks
    ViolaLass
    • #6
    • 11th Mar 17, 7:31 AM
    • #6
    • 11th Mar 17, 7:31 AM
    OP, how much do you earn?
    • Killacam
    • By Killacam 11th Mar 17, 8:00 AM
    • 8 Posts
    • 1 Thanks
    Killacam
    • #7
    • 11th Mar 17, 8:00 AM
    • #7
    • 11th Mar 17, 8:00 AM
    I earn 18k I have a MacBook on finance for £130 a month and a few small items like phone and etc, 8 have a around 900 disposable each month give or take, I have already had another few items on finance a few years back all paid with no issues, I messed up on my credit card when I was 19 I was late around 2 times and went overlimit a fair amount of times as I wasn't aware of interest applying each month, I now have had this under control since.
    • Killacam
    • By Killacam 11th Mar 17, 8:02 AM
    • 8 Posts
    • 1 Thanks
    Killacam
    • #8
    • 11th Mar 17, 8:02 AM
    • #8
    • 11th Mar 17, 8:02 AM
    I wouldn't say I'm living beyond my means, I just am not a good saver, if I was I could save 7-800 a month but I can not do it aha, hence why I pay monthly for things and I also want to build my credit, although this seems to be going adversely at present :'(
    • ViolaLass
    • By ViolaLass 11th Mar 17, 8:14 AM
    • 4,860 Posts
    • 6,703 Thanks
    ViolaLass
    • #9
    • 11th Mar 17, 8:14 AM
    • #9
    • 11th Mar 17, 8:14 AM
    Learn to save.

    Really, you'll thank yourself for it in a few years.
    • DCFC79
    • By DCFC79 11th Mar 17, 8:22 AM
    • 28,719 Posts
    • 18,141 Thanks
    DCFC79
    I earn 18k I have a MacBook on finance for £130 a month and a few small items like phone and etc, 8 have a around 900 disposable each month give or take, I have already had another few items on finance a few years back all paid with no issues, I messed up on my credit card when I was 19 I was late around 2 times and went overlimit a fair amount of times as I wasn't aware of interest applying each month, I now have had this under control since.
    Originally posted by Killacam
    How much are you paying for these items on finance ?

    If you had a direct debit set up you woild have been ok, keep a regulsr check on how close to your balance.
    Je Suis Charlie
    • dresdendave
    • By dresdendave 11th Mar 17, 9:42 AM
    • 557 Posts
    • 597 Thanks
    dresdendave
    I earn 18k I have a MacBook on finance for £130 a month and a few small items like phone and etc, 8 have a around 900 disposable each month give or take, I have already had another few items on finance a few years back all paid with no issues, I messed up on my credit card when I was 19 I was late around 2 times and went overlimit a fair amount of times as I wasn't aware of interest applying each month, I now have had this under control since.
    Originally posted by Killacam

    You earn 18K, so roughly £1200 take home per month and you have £900 disposable income? Your outgoings are incredibly low but you are using finance to purchase items. Where is the rest of this money going? You should be buying phones, laptops outright and saving for higher price items such as a car.


    Your low outgoings suggest you are still living with parents, assuming you want to move out one day, start saving now for a deposit for your own place. Once you live in the real world £900 spare income a month will be some thing you can only dream about.


    Sorry if this seems harsh but most people in their 30s or 40s struggling to survive financially will look back with regret at poor financial decisions they made when they were younger.
    • Killacam
    • By Killacam 11th Mar 17, 10:19 AM
    • 8 Posts
    • 1 Thanks
    Killacam
    I appreciate it and the rest goes on my clothing addiction and just buying stuff lol, I pay out about 300 a month on smal finances all coming out through direct debit, I need to start saving and I will but right now I need a car aha
    • Gaz83
    • By Gaz83 11th Mar 17, 10:34 AM
    • 3,515 Posts
    • 6,689 Thanks
    Gaz83
    I appreciate it and the rest goes on my clothing addiction and just buying stuff lol, I pay out about 300 a month on smal finances all coming out through direct debit, I need to start saving and I will but right now I need a car aha
    Originally posted by Killacam
    As you are finding out, you don't have a right to credit. Lenders can't be forced to loan money to you.

    Save for a couple of months and buy a car for £1,800.
    "Facism arrives as your friend. It will restore your honour, make you feel proud, protect your house, give you a job, clean up the neighbourhood, remind you of how great you once were, clear out the venal and the corrupt, remove anything you feel is unlike you... [it] doesn't walk in saying, "our programme means militias, mass imprisonments, transportations, war and persecution."
    • Vikipollard
    • By Vikipollard 11th Mar 17, 2:02 PM
    • 614 Posts
    • 1,077 Thanks
    Vikipollard
    I appreciate it and the rest goes on my clothing addiction and just buying stuff lol, I pay out about 300 a month on smal finances all coming out through direct debit, I need to start saving and I will but right now I need a car aha
    Originally posted by Killacam
    So...you can't won't save, have a clothing addiction and now you "need" a car, yet you haven't mentioned how you intend to pay for insurance - and for a 22yr old, that won't be cheap... What could possibly go wrong....

    Either:

    Save 800 per month for 3 months (after all, if you cant make yourself do that, how will you cover the loan?) and then buy the car or

    Out of the 800-900 you say you have spare per month, buy a 500 car, and then the 300 you still think you have spare will cover the insurance. You don't need a fancy car. You want one. And if the 6-7000 was intended to cover the insurance as well, then how did you intend to pay for it next year?

    Reality check. You should view your disposable income as that which you actually save per month. In your case, this is nothing, so you cannot afford a loan unless you have the discipline to show you can save first.

    Harsh? Maybe. But I wish someone had given me the hard line before I believed the same as you do; that just because on paper you can afford it, that's not actually true.
    LBM July 2006
    Debt Sept 06 £19,972
    Debt free 01 Sept 12 ..

    Finally joined Slimming World: weight loss 33lbs...target achieved 51wks later 06.05.13
    • ViolaLass
    • By ViolaLass 11th Mar 17, 3:36 PM
    • 4,860 Posts
    • 6,703 Thanks
    ViolaLass
    "lol" indeed. Isn't it hilarious.
    • Killacam
    • By Killacam 11th Mar 17, 7:24 PM
    • 8 Posts
    • 1 Thanks
    Killacam
    I appreciate the genuine help from people and I do know I need to start saving, I do however have other means of getting this money so its not a huge problem, I don't need assistance on my finances though I am already trying to get that in order, however the actual fact of me getting declined for credit was a bit of a shock as I always get accepted for things.

    Thats my reason for posting and people have answered that. I only need help with my application but thank you for the help and the genuine hard comments which will actually help with my mind set. Saving for the car itself isn't really an option, so I'm wondering what you guys would recommend as I want to do this by myself without help from family. I am looking at finding the cheapest car I can but with certain features like eco driving etc. I am looking at getting a fiesta 1.0 ltr one of the newer shape ones, just want the best advice on how to go about that without borrowing money from family.
    • Killacam
    • By Killacam 11th Mar 17, 7:25 PM
    • 8 Posts
    • 1 Thanks
    Killacam
    "lol" indeed. Isn't it hilarious.
    Originally posted by ViolaLass
    I don't understand?
    • Maximum Saving
    • By Maximum Saving 11th Mar 17, 9:55 PM
    • 160 Posts
    • 306 Thanks
    Maximum Saving
    I needed to buy a wheelchair accessible car suitable for my son. So in 2013 I found a suitable car and it cost £5995. So I paid for it using cash, a debit card and a credit card. I didn't want to take on a loan because I would have had to pay interest. I liked to use a zero percent interest credit card. I paid off my debt before interest would have been charged.
    • pvt
    • By pvt 12th Mar 17, 7:43 AM
    • 1,278 Posts
    • 1,026 Thanks
    pvt
    Killacam,

    The reason you've been refused credit is because in Sainsbury's eyes you fit the profile of a financial disaster about to happen. 22 years old, materialistic desire for high end consumer goods that you cannot afford, and a history of getting into payment difficulties.

    You have a reasonable income, which you could easily be saving money from, yet, by your own admission, you're spending your income like pocket money every month till it's all gone.

    You may have some (yet to be displayed) self constraint and have the discipline to repay the money you want to borrow, but statistically you're likely to end up deeper and deeper in hock, owing tens of thousands by your mid twenties, and contemplating bankruptcy by your thirties to "reset" your life.

    Sorry for my harsh judgemental tone. If it's not to your liking you need to find someone who wishes they had saved less and borrowed more in their earlier life - and you won't find many like that frequenting this site.
    Optimists see a glass half full
    Pessimists see a glass half empty
    Engineers just see a glass twice the size it needed to be
    • Killacam
    • By Killacam 12th Mar 17, 9:29 AM
    • 8 Posts
    • 1 Thanks
    Killacam
    Killacam,

    The reason you've been refused credit is because in Sainsbury's eyes you fit the profile of a financial disaster about to happen. 22 years old, materialistic desire for high end consumer goods that you cannot afford, and a history of getting into payment difficulties.

    You have a reasonable income, which you could easily be saving money from, yet, by your own admission, you're spending your income like pocket money every month till it's all gone.

    You may have some (yet to be displayed) self constraint and have the discipline to repay the money you want to borrow, but statistically you're likely to end up deeper and deeper in hock, owing tens of thousands by your mid twenties, and contemplating bankruptcy by your thirties to "reset" your life.

    Sorry for my harsh judgemental tone. If it's not to your liking you need to find someone who wishes they had saved less and borrowed more in their earlier life - and you won't find many like that frequenting this site.
    Originally posted by pvt
    The truth is, comments like this actually do help. I appreciate the time taken to write that reply. What do you recommend for me to do? Tesco are apparently a lot easier to get, would you recommend me to apply for that? or not? and just bite the bullet and borrow from family.
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