Sainsburys loan

steph_p123

So I currently have a loan with Sainsburys which I took out 8 months ago for a car. I am now looking to get a first mortgage so I decided to take down my monthly loan commitments. I would get a new loan for the existing amount over another 24 months, lowering monthly payments but lengthening the term.

They declined me...

I am so frustrated - I have paid perfectly on time, I earn more now than I did then and I confirmed that the new loan would immediately pay off the old - they would do it for me so I would never even see the money!!

I cant work out why I cant get this, my credit score is pretty much perfect for someone who has not had a mortgage - no late payments, credit cards paid off in full etc.


Im really upset now as I am panicking that as I cant get a £3200 loan how on earth am I going to get a mortgage!?

paddyrg

You can't get £3200 *extra* unsecured loan (they see it as extra, as you could run off and spend it instead of paying off old loan). But if you need a loan for £3200 you're right it looks very dubious on the mortgage front as you have no deposit, even though mortgages are secured on the property.

steph_p123

But I cannot run away with it as they are never giving me the money, they arrange to pay the old loan off without me even seeing it!!

And also the money isnt for a deposit - I already have this in place. The new loan was only to lower monthly repayments on the old loan by technically just extending the period.

I just cant see why they have declined me... I even earn more now than when i took the last loan out!!

Oh and to add - the old loan is with Sainsburys and I applied for the new loan also with Sainsburys

YorkshireBoy

How long has the old loan been running?

See it from their viewpoint...

To Sainsburys' credit scoring system, you're saying you're struggling (or will struggle) to meet the payments due to current or upcoming other financial commitments.

steph_p123

it has been running 8 months.

I suppose when you look at it that way - unfortunately I can afford to pay it is just so that when I apply for a mortgage the commitments are lower. The plan would be to overpay to the same rate anyway...

oh well guess ill just have to leave it as it is and take the risk that the mortgage wont be too affected by a larger monthly commitment!!

YorkshireBoy

By how much would the monthly payments have reduced?