Really confused about refusal of car finance!

loobyloo0302

Hi all.. I just saw a few threads on here that got me thinking about a situation around 6 months ago!

I already have a car on finance from a dealership. This was spread over 4 and a half years and I am around 1 year and 7 months of paying this off. I went to a dealership with my sister around september last year, so 1 year 1 month into paying off mycar. She bought a brand new car, and after all was signed and sealed, the salesman turned to me and tried toconvince me that I needed a new one, and I actually fell for it! Anyway,I gaveallmy details, signed and paid a deposit and awaited my phonecall the nextday to be told if my request for finance had been accepted or not. A few days passed and I heard nothing, the salesman always seemed to be out, then I recieved a phonecall asking me how much I earned per week. At that time, I was on maternity leave and so was earning the SMP rate of £124 per week and gave that figure. Now I wasn't askedhow much I earned when Isigned for the car that I am paying finance for. Then I received a phonecall a few days later saying that he could not find a company wiling to accept me for finance - now I just couldn't get my headaround this at all, as I'dpreviously been accepted before, obviously!

Since then, I have two mobile phone contracts in my name and have rented a kitchen appliance (a recommendation from someone who works for my partner)all of which do credit checks.

I haven't missed a payment for my car, a few bills were paid late just before I went for the newer car as my contract changed whilst on maternity leave, which meant my pay was altered from monthly to weekly. But these bills were all paid shortly after they were due. Until then, Ihave not paid any bills late or missed any payments. I do have an overdraft of £250, that was eaten into when we had to move from temporary accomodation (we weren't registered as living there, it was hokliday accomodation rented out over winter). This,however,is currently being rectified by weekly payments into the account (I do not use this account) We moved into one house in about march of 2007, then moved out around June of 2008 andhave been here since. Before that, I lived with my parents at the same address since birth. I have been with the same employer since april 2006. They are the only things that I am aware of that could affect why I was refused. Thinking about it again even now makes me wonder why, although I realised after I'd got home from handing over my deposit that I'd done a silly thing so was relieved really! Either way though, I would still like to understand better why I was refused and maybe find out if I can alter the problem for when thisfinance has beenpaid off!

Typhoon2000

Earning £124 a weeks with lots of debts /overdraft/ missed payment? How much wound the new car payment have been for in relation to your earning that you provided the lender?

loobyloo0302

Typhoon2000 wrote: »

Earning £124 a weeks with lots of debts /overdraft/ missed payment? How much wound the new car payment have been for in relation to your earning that you provided the lender?

Where did the lots of debt come from?? I owe on my car only, which obviously would have been settled had I gone through with another finance agreement and the overdraft was at the time, being paid off and only began at £250 \ I'm pretty sure that I'm not the most unsecure person to accept finance on, especially considering I was accepted previously! I don't consider my overdraft to be massive, and I don't live off it either, I'm not constantly borrowing on the overdraft (as previously mentioned) as I do not use this account, my wages are paid into another account that does not have an overdraft facility. I have a standing order set up to transfer money from the account I use to the one that I don't. I don't see how this makes me such a terrible person to lend to?

The payments would have been bumped up to around £179 (currently £148)

As an edit, I don't see where Isaid I'd missed a payment either??? I stated that around september last year, a few of my bills were paid shortly after their due date as my employer changed my contract whilst I was on maternity leave which meant the consistancy of my pay was altered. Note, the "were paid shortly after the date they were due" and the difference between "missed payments" I've never missed any payments!

oh and at the time, I was unsure as to what "marital status"options were available to me as sometimes you get single, partner,living together as if married etc. Well I had a bit of a mental block and just said "single" with 2 dependants (children) as I was rushed through it! I don't know if that makes a difference either?

woody01

I fail to see where you are confused :doh:

• Only £124 per week earnings
• Overdrawn and the low income doesn't even get paid to that account
• Missed payments (makes no difference if you caught them up or not)
• Already have 2 mobile contracts and a 'kitchen appliance' on credit

You may well be at the limit of the credit your income can be deemed to withstand.
You are also, judging by what you have stated to us, a poor risk for credit.

loobyloo0302

woody01 wrote: »

I fail to see where you are confused :doh:

• Only £124 per week earnings
• Overdrawn and the low income doesn't even get paid to that account
• Missed payments (makes no difference if you caught them up or not)
• Already have 2 mobile contracts and a 'kitchen appliance' on credit

You may well be at the limit of the credit your income can be deemed to withstand.
You are also, judging by what you have stated to us, a poor risk for credit.

I don't think I'll post of thids board again - you make me sound like a criminal!!!

The kitchen appliance is a rental agreement, not credit agreement !!!!!!!! And I DID state that I got these three AFTER the car finance ioncident!!!

My overdraft was £250 at that time and IS BEING PAID OFF BY STANDINH ORDER from the account I've used since I was 16!!!

You know, there's people on this very forum with tens of thousands of pounds of debt that have mentioned they are applying for MORE credit cards/ loans to pay off what they owe and yet you choose to jump on me as I am unsure of the way finance works? Missed payments? Crime of the century - I paid these bills the minute my wages were sorted out but you make out I was trying to shirk them and didn't bother blinking paying them! Telling me I've got credit that I haven't??? The kitchen appiance was a rteccomendation from someone who works for my partner, it says RENTAL agreement not CREDIT agreement and I didn't even have this at the time as I explained in my OP, which led me to being confused about my refusal as this and the mobile phone contracts require credit checks!!

You make me sound like the modern day di ck turpin, for having a £250 overdraft which gets paid off, for taking maternity leave and for already having a finance agreement.

Fail to see where your confused?? Get off your high horse for gawds sake, there's plenty on this forum that are in debt to their eyeballs, thousands of times more debt than I have (cart finance before you twist this too),

Well what a wrong move to ask a query on here.

CLAPTON

basically credit is harder to get now than formally
many people who have previously found getting credit easy are now being turned down

being on 124 per week, with some existing debts and with a less than perfect credit history is sufficient to be turned down

although 250 OD is not a great deal, creditors are now viewing people often or permanently in their OD as being bad risks as it's seen to be a sign that people can't manage money well

It may or may not be fair but that's how it is now.

In any case it seems to be good news as you don't actually need/want an alternative car.

triticale

loobyloo0302 wrote: »

I don't think I'll post of thids board again - you make me sound like a criminal!!!

The kitchen appliance is a rental agreement, not credit agreement !!!!!!!! And I DID state that I got these three AFTER the car finance ioncident!!!

My overdraft was £250 at that time and IS BEING PAID OFF BY STANDINH ORDER from the account I've used since I was 16!!!

You know, there's people on this very forum with tens of thousands of pounds of debt that have mentioned they are applying for MORE credit cards/ loans to pay off what they owe and yet you choose to jump on me as I am unsure of the way finance works? Missed payments? Crime of the century - I paid these bills the minute my wages were sorted out but you make out I was trying to shirk them and didn't bother blinking paying them! Telling me I've got credit that I haven't??? The kitchen appiance was a rteccomendation from someone who works for my partner, it says RENTAL agreement not CREDIT agreement and I didn't even have this at the time as I explained in my OP, which led me to being confused about my refusal as this and the mobile phone contracts require credit checks!!

You make me sound like the modern day di ck turpin, for having a £250 overdraft which gets paid off, for taking maternity leave and for already having a finance agreement.

Fail to see where your confused?? Get off your high horse for gawds sake, there's plenty on this forum that are in debt to their eyeballs, thousands of times more debt than I have (cart finance before you twist this too),

Well what a wrong move to ask a query on here.

I don't think woody was having a go, just stating the facts as a lender would see it.

As CLAPTON says, lenders are more cautious who they lend to these days.

woody01

triticale wrote: »

I don't think woody was having a go, just stating the facts as a lender would see it.

As CLAPTON says, lenders are more cautious who they lend to these days.

Thankyou. I wasn't having a go at all.
The OP asked and received the likely answer.
Pity she saw it as a personal attack when it clearly wasn't.

loobyloo0302 wrote: »

I don't think I'll post of thids board again - you make me sound like a criminal!!!

The kitchen appliance is a rental agreement, not credit agreement !!!!!!!! And I DID state that I got these three AFTER the car finance ioncident!!!

My overdraft was £250 at that time and IS BEING PAID OFF BY STANDINH ORDER from the account I've used since I was 16!!!

You know, there's people on this very forum with tens of thousands of pounds of debt that have mentioned they are applying for MORE credit cards/ loans to pay off what they owe and yet you choose to jump on me as I am unsure of the way finance works? Missed payments? Crime of the century - I paid these bills the minute my wages were sorted out but you make out I was trying to shirk them and didn't bother blinking paying them! Telling me I've got credit that I haven't??? The kitchen appiance was a rteccomendation from someone who works for my partner, it says RENTAL agreement not CREDIT agreement and I didn't even have this at the time as I explained in my OP, which led me to being confused about my refusal as this and the mobile phone contracts require credit checks!!

You make me sound like the modern day di ck turpin, for having a £250 overdraft which gets paid off, for taking maternity leave and for already having a finance agreement.

Fail to see where your confused?? Get off your high horse for gawds sake, there's plenty on this forum that are in debt to their eyeballs, thousands of times more debt than I have (cart finance before you twist this too),

Well what a wrong move to ask a query on here.

You asked why you are turned down for credit and been told.
Why are you stamping your feet in disgust that you are clearly not credit worthy (which is obviously my fault :wall: ).

Your income is low, you have missed payments and you are probably at your credit maximum.
(also, a rental agreement is almost certainly credit checked).

Maybe instead of stamping your feet you should listen to what has been said.

redpete

loobyloo0302 wrote: »

Well what a wrong move to ask a query on here.

No, the wrong move was to get upset at a very clear and non-judgemental answer to the question you asked.

As to why you got the phone contracts - they would have been for less money per month, it's easy for a phone company to stop further use if you get into debt with them, and the phone companies' criteria would have been different.

immoral_angeluk

From a financial perspective...

£124 a week income = £537.33 a month
New car payment would be £179 a month.

= £358.33 left from which you'd have to pay for all of your domestic expenditure, rent, council tax, gas/elec AS WELL as the running costs for the car, insurance, petrol, maintenance.

That alone would be unacceptable to any creditor as to them it would be amazing (on that income) how you are managing the monthly car payments as it is.


Also, if you put single then you are a higher financial risk than, say, a cohabiting couple. You are unemployed and on benefits, again, higher financial risk.

No responsible lender would allow you to take on further finance of that scale (mobile contracts are a different kettle of fish.)

The late payments would also show on your credit files and would go against you.

jazza77

OP I'm afraid the other posters are just advising you of the situation as it is. Even people on a high income and with a perfect credit record can have problems. I imagine this is an extreme example, however I know of an acquaintance who earns a six figure salary, has no money worries whatsoever, but last year was unable to get an unsecured loan of around £23k to buy a car. She was able to use other avenues and raise a secured loan, not that I would recommend that however. The point being however that it is not necessarily a reflection on you. I too have been refused credit at various times and know how frustrating it is. Unfortunately with the way things are at the moment and in your current circumstances it would appear that obtaining further finance will not happen. Unless you really really need a new car though that's not necessarily such a bad thing.