credit score

mummytwinton

can having to many un used credit cards really go against you on a credit score when trying to get a mortgage???

we have been turned down for 2 mortgages in the last week. we have no clue why & i'm waiting for a pin code to see on the experian site whiy???
i haven't slept right for days now worrying over why we can't get a new mortgage when we are only asking for the same amount as we have now, in fact we have the upper limit of 100k but have only used 98k on virgin one.
we did have 20k on 0% credit cards when we first asked but have cleared them onto the mortgage taking us back up to the 98k.

sorry to keep going on but i'm so stressed over why, we have never missed a payment or been late. the only thing we have is on a credit card we closed in january a payment went on it that was a wrong payment but it took them 2 months to tell us it was there & so we were charged 2 months late payments but this has all been cleared now & payments paid back to us. would this show on our credit score

Warriorsith

It might show on your Credit file but I can see it affecting your Credit Score that much. You'll have to see what's on both your files to see what the cause is, it might be best to get a report from Equifax too as differant companies you either both or one of the credit agencies to keep track of your 'credit agreements' you enter in too.

Have you not asked the mortgage companies why they declined you? I have friends that recently got turned down for their mortgages as neither of them had a credit card and always paid for cash for the items they purchased.

I'd ask why you got decline to put your stress aside so you can work on a solution.

Good Luck.

lisyloo

I would suggest that you try to get an appointment to speak to a human being.

The refusals you are getting are simply the work of a computer program that works on rigid rules.
It's quite possible that if you "appeal" and get a human being to review the case that you will get your mortgage.

The worst thing you can do is keep applying because each search is recorded.
Lots of searches look like a desperate person being turned down and just result in more refusals. So don't keep applying without getting down to the bottom of the problem. You need to get to the bottom of it.

You need to book an appointment to see someone to discuss this at the mortgage company.

Closing the cards takes a while but if you are not using the cards then reducing the credit limits might help.

AndrewSmith

Having un-used credit cards will not affect your credit score unless there have been some missed payments on them within the last 6 years.

Mortgage companies reserve the right to refuse or decline a mortgage application at any time and without reason.

The issue regarding the payment error may affect your credit score as it will show as very recent. You will be able to see this when you access yur experian file. If this is the case I would contact the credit card issuer and get them to amend their records to show this on your credit file.

Without knowing more there is not really a lot more help I can be.

Andy

HelpWhereIcan

As people have implied/said, credit scoring is a black art rather than an exact science.

You will probably find that the main thing that went against you was the fact that you had 20k on credit cards. Now this in itself is not a problem as far as your score goes - afterall, explaining to the lender that they will be repaid before the new mortgage starts will allay any fears they have about affordability and having repaid them properly in the past goes for you. Where it can affect your score with some lenders is if you owe above a certain % of the total credit available to you.

eg if you owe 20k on cards with 20k limits, you will score less than someone who owes 20k on cards with limits of 40k. Apparantly, it is about spotting someone who may be overcommitted/about to overcommit before it happens (the same thinking that is applied to the number of searches). The lender may argue that you are trying to remortgage to them as a last resort if they can see a number of searches (possible decined applications/desperation) and that you are up to the limit on your cards (how long before the missed/late payments start to appear?). Therfore, I would argue that an 'unused' facility may actually help you rather than hinder you.

Even this though will normally only be enough to turn a 'boderline' score to a decline and is unlikely to turn an easy pass into a decline.

IMO, you have done the right thing in repaying the cards and requesting your file. As had been said before, I would think that your score will improve once the cards are showing as clear.

What I would also say is that there is often a skill in completing a lender's application in order to present your case in the best light. I am not talking about lying, but am saying that questions you may see as irrelevant may form an important part of the scoring process eg one lender I know cares very much about how many phone numbers you enter - mad eh?

As has been said before, wait until your file comes back and shows the 20k card debt has been repaid, then talk to a whole of market broker to ensure that your application goes to the right lender, presented the right way and with the minimum of further fuss and worry for you.

Hope this helps

mummytwinton

great they won't let us have a mortgage but have let us have a nationwide current account!!!!!!! if were no good for one thing whyt are we good enough for the other.



still waiting for our pin number to come though the post for experian to check for the reason as to our poor credit score any idea how long this can take we applied at 9am on monday

Joe_Bloggs

I bet the new current account, Nationwide credit card and mortgage application all triggered a seperate credit search. So much stock has been put in financial institutions sharing information with each other when some may have difficulty in sharing it within an institution. Perhaps there should be a class of credit search where a lender finds out what what is going on within itself.

This is just speculation on my part but computer programs cannot read between the lines to see a logical progression. There is recourse if you think you have been treated badly by a computer program. This involves speaking to the underwriting staff. They will want to see your credit files to see where there computer programs or internal methods went wrong. There may useless laws to prevent this treatment from happening.
J_B.

Warriorsith

mummytwinton wrote:

great they won't let us have a mortgage but have let us have a nationwide current account!!!!!!! if were no good for one thing whyt are we good enough for the other.



still waiting for our pin number to come though the post for experian to check for the reason as to our poor credit score any idea how long this can take we applied at 9am on monday

I think I had to wait about a week for mine to get sent to me, it takes about the same amount of time for them to send you a paper copy of your file too.

regularsaver1

credit scoring can depend on different things on a mortgage - ie. how much deposit ect

can they not tell you the reasons why?

Experian_company_representative

Mortgage lenders should tell you the principle reason for refusing credit. If they don't, ask to speak to someone higher.