Cannot get credit...help

Rexel_2

Hopfully someone can help, I have recently got married and as you do managed to put a fair bit on credit cards, I currently owe around 7k. Only one of these is on interest only up until November, I really want to get this paid off as soon possible, whilst having to pay as little interest as possible.

My initial idea was to get a loan to cover the whole amount and pay it off over the course of 2/3 years.

After using moneysupermarket and even speaking to my own bank I was finding very hard to find anyone that would lend me the money, the only people who would are the type to charge through the nose (100+%)

I have never missed a payment on any of my bills, credit cards and even a loan I had a few years back that I was paying off for 5 years. In fact the last time I missed a payment on anything was over 3 years ago, and that was only 2 months.

I have checked experien, nothing is showing as overdue, I have produced a credit score which has come out as 999 (Excellent) the only thing they have put that is having a negative effect is that I have a high debt to credit ratio.

I have a reasonable income of about 30k a year, what strikes me as strange is that when I got a loan last time which was for £7,500 i was earning half what I'm currently on!

Can anyone suggest what might be the problem?

Thanks

tescomilk

Rexel wrote: »

Can anyone suggest what might be the problem?

Its likely the "current economic climate" is causing you difficulties. Banks still are not lending like they used to and the criteria for getting a loan is likely more difficult than a credit card. Several years ago I easily got 6.9% APR £3000 loan from a company that were not even my bank, nowdays there is very little offers like that. Try not take it too personal.

Your score of 999 is Good however its not actually worth anything because each lending company has its own criteria. If they're not gonna make any money (or very little) out of you then why should they lend you the money in the first place?

My advice would be to shift the balance. Have you tried applying for another 0% card to transfer some of the balance on to? Good Luck :cool:

Tixy

I would discount any comparisons to when you last got a loan as the market has changed such a lot in the current economic climate and it is much much harder to get any new credit.

You say you owe £7k, what is your current existing total credit?
A high debt to credit ratio will count against you, how much will depend on each individual lender.

Any bank will look at a consolidation loan as extra credit being made available to you as they have no guarantee that you will use it to pay off your loans.
Many people, even those with good credit history are finding it hard to get new credit which will take the total credit to over 50% of your income, from what you have said you would probably around that with the new loan.

How many credit applications have you made recently? If its quite a few then you might need to wait before you apply again for any more.

Other possibly options might be to see if you can move one or 2 cards to 0% deals. You could then try card shuffling or even try for a lower value loan with your own bank.

Other reasons you may be struggling - have you recently moved home when you got married? are you on the electoral roll? Are you financially associated with your husband? does he have a bad credit history?

tescomilk

...also the problem you have is that your existing debt is on credit cards. So while you may know you can afford a £7k loan, there is a risk that if you were given it, you could pay the £7k off the credit cards but then start spending on them again ending up £14k in debt.

While i'm sure you won't do that - it is something that the banks computer systems will calculate when processing your application. This often happens with people who transfer balances a lot. They can effect double their credit risk if approved.

Rexel_2

Tixy wrote: »

I would discount any comparisons to when you last got a loan as the market has changed such a lot in the current economic climate and it is much much harder to get any new credit.

You say you owe £7k, what is your current existing total credit?
A high debt to credit ratio will count against you, how much will depend on each individual lender.

Any bank will look at a consolidation loan as extra credit being made available to you as they have no guarantee that you will use it to pay off your loans.
Many people, even those with good credit history are finding it hard to get new credit which will take the total credit to over 50% of your income, from what you have said you would probably around that with the new loan.

How many credit applications have you made recently? If its quite a few then you might need to wait before you apply again for any more.

Other possibly options might be to see if you can move one or 2 cards to 0% deals. You could then try card shuffling or even try for a lower value loan with your own bank.

Other reasons you may be struggling - have you recently moved home when you got married? are you on the electoral roll? Are you financially associated with your husband? does he have a bad credit history?

Looking at your last paragraph it is pretty much all of the above, I have moved within the last two months, my experien is still showing me as on the electoral roll at my old address, which I am currently changing.

I have recently got married just under two weeks ago, my wife does also have some debt that we are trying to shift, however she doesnt have a bad credit score either.

My current debt is £6896 with £804 available credit, that puts be at 89%. I have made two applications for credit recently, one was through my bank. The other was for a credit card, both were declined.

Thanks for your help so far.

CLAPTON

how much have you been applying for?

Rexel_2

CLAPTON wrote: »

how much have you been applying for?

Only enough to cover what I owe, about £7000 over 2/3 years. At least then I'm committed to paying it I can chop up my credit cards and get on with things whilst paying as little interest as possible.

Dabooka

What's your wife's current debt level against income ratio? And you say her credit rating isn't bad, but anything at all on there?

Rexel_2

Dabooka wrote: »

What's your wife's current debt level against income ratio? And you say her credit rating isn't bad, but anything at all on there?

She owes around 12,000 with an income of 22k, I will have to get a recent report on her credit file but I think its good, the applications I made were before we were married.

Dabooka

Rexel wrote: »

She owes around 12,000 with an income of 22k, I will have to get a recent report on her credit file but I think its good, the applications I made were before we were married.

Right, don't assume being financially linked is to do with your marriage. Do you have any joint accounts / cc / mortgage, that'll link you?

I think it could be a couple of things then, your income to debt ratio seems quite high and as you need to consolidate, your electoral roll is out of date (and I think that's only updated every few months, when did you fill in the form? If you haven't yet get in touch NOW as I read on here last week that some councils do a "run" early - mid August), and that's all before you mention any other outgoings; mortgages, car loan etc. I know the electoral register problem is a big huge no-no when applying for credit.

Rexel_2

Dabooka wrote: »

Right, don't assume being financially linked is to do with your marriage. Do you have any joint accounts / cc / mortgage, that'll link you?

I think it could be a couple of things then, your income to debt ratio seems quite high and as you need to consolidate, your electoral roll is out of date (and I think that's only updated every few months, when did you fill in the form? If you haven't yet get in touch NOW as I read on here last week that some councils do a "run" early - mid August), and that's all before you mention any other outgoings; mortgages, car loan etc. I know the electoral register problem is a big huge no-no when applying for credit.

We have a joint account, no mortgage or CC's.

I have literally filled out and will be sending off the forms today as the next cut off date I believe on 10th August for my name to be put on for 1st Sept.

Would you think if I waited another four months or so and try and apply again, by which time I should have cleared some off my debt to lower my credit to debt ratio, whilst then being on the electoral roll & having then lived at my current address for 6 months rather than 2.

Will it have an effect if my wife is not on the electoral roll as we are links via our joint account?