Treasury Committee launches inquiry into Credit Searches in conjunction with MSE

edited 6 October 2009 at 7:18PM in Credit Cards
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  • I've recently applied for a few different savings accounts. Each application has obviously resulted in an entry on my credit file. I have just been turned down for a 0% credit card despite the fact that I have over 150k spread around!! Equifax was quoted in the reasons for refusal. Have my savings applications impacted on my credit score and, if so, surely this is diabolically wrong.

    On the same subject, it annoys me intensely that savings are never considered by the decision makers when credit card applications are made.
  • gssellars wrote: »
    I've recently applied for a few different savings accounts. Each application has obviously resulted in an entry on my credit file. I have just been turned down for a 0% credit card despite the fact that I have over 150k spread around!! Equifax was quoted in the reasons for refusal. Have my savings applications impacted on my credit score?
    No, these will be unrecorded enquiries for ID purposes. Unrecorded enquiries are listed for your information only, so you know which firms have searched your file. They are not seen by other lenders and have no effect on your credit rating ;)
    People who don't know their rights, don't actually have those rights.
  • gssellars wrote: »
    On the same subject, it annoys me intensely that savings are never considered by the decision-makers when credit card applications are made.
    It comes as a surprise to lots of us, but the credit card arm of a bank has limited info' about your savings account(s) with that bank and other savings institutions due data protection regulations.
    People who don't know their rights, don't actually have those rights.
  • never-in-doubtnever-in-doubt
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    Moggles wrote: »
    It comes as a surprise to lots of us, but the credit card arm of a bank has limited info' about your savings account(s) with that bank and other savings institutions due data protection regulations.

    Also the fact is savings can be fiddled to allow provision. i.e. your mate is rich, he lets you use £100k of his cash to pay into your bank - you do it, get a loan/cc/bank account etc and then remove the savings and keeping the credit that you'd not otherwise have got.

    Savings cannot be used in credit decisions for that exact reason. :beer:
    :o 2010 - year of the troll :o

    Niddy - Over & Out :wave:
  • I recently applied for an Egg Money card to use for cashback when I couldn't use my Amex platinum cashback card. I am a foreign national, unable to get onto the electoral roll, so was denied by Egg at first. I sent a letter to them and had a phone interview asking about all my accounts and balances (savings, other cc's, ISAs), then was told that due to it taking them a while to get back to me I'd need a fresh hard search on my credit file if I wanted to go ahead with the challenge :eek:

    To cut a long story short, I received my egg card in the end, but my rate is 21.9% + £1/month, which is a good deal more than the 16.9% advertised + £1/month
  • DebtMagnetDebtMagnet Forumite
    209 Posts
    Part of the Furniture Combo Breaker
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    To learn about the types of searches have a read of my handy guide here: Credit Reference Agencies



    I'd consider complaining to them using the basis of knowledge learned and the fact you feel you were mis-sold a product which may have offered them a more generous commission and as such you'd like to formally request the sale and retrospective processes are audited to establish authenticity within set guidance (to check they complied and did not mis-sell you the wrong product for financial gain!)....


    Good Luck whatever you decide, feel free to PM or post away if you need specific advice or help..... :beer:

    Thanks for the link to your guide never-in-doubt.

    As for complaining, I did complain about the mortgage advisor to the FSA and they agreed to pay me back the fee they charged for their services which i accepted (and since regretted but that's another story) so not sure if that would have meant that I couldn't take it any further, and so I kind of put it to bed.

    I think I'll let it lie for now but this info has opened my eyes a lot so thanks again.
  • Today I applied for a debt consolidation loan from Halifax/Bank of Scotland after receiving continuous offers through my internet banking account to apply. It was offered at a rate of 8.9%.

    I got an e-mail advising It had been approved in principle and I had to call to confirm some details.

    When I called, I was told, it had been approved at a rate of 14.9% due to underwriters looking into my application and personal details. I asked what the criteria was and what in these 'personal details' that made the rate jump so much, but there was no specific information they could give me. I replied that I had a really good credit history, and was told the decision may not be related to my credit score.
  • Eric_PischEric_Pisch Forumite
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    Part of the Furniture 1,000 Posts Combo Breaker
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    I wished to get a new cash back credit card so I applied for an 5% card but was turned down as I had applied for a loan recently (which I had not taken out) which had affected my credit rating. I applied for a different cash back card a few months later (unaware of the negative impact credit searches have on your rating for 6 months) and effectively destroyed my credit rating for 6 months.

    The current system penalises the consumer for "testing the water" and effectivly locks them into one credit application every six months and forces them to take that sole application.

    The rating system needs to be changed so that checks do not affect your rating and that only credit taken out is scored.
  • IdiophreakIdiophreak Forumite
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    louieob wrote: »
    I replied that I had a really good credit history, and was told the decision may not be related to my credit score.

    This is the bit that really winds me up - if the decision isn't to do with the credit score, they should tell you you're not going to get the desired rate *before* they go on and dent your file. I really think it's completely unethical for them not to do so...and it ought to be illegal.
  • This happened to me a couple of months ago with Alliance & Leicester. I was in the branch and they offered 8.9% on a loan and once the application went over the system it was calculated at 11.9%!
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