Is credit scoring fair?

LisaB1970

I have to ask this question because looking at my credit file it has been seriously hurt by the 2 mortgage searches. Its gone from borderline very good to poor!

It now tells me: A score like this usually means you’ve had problems making repayments in the recent past. To avoid any difficulties getting credit, assess your existing borrowing carefully before applying for more credit, or you could find yourself in serious financial trouble.

This is NOT true! I HAD a good credit score, i have NEVER missed any payments on any of my credit, i have NO CCJ's or anything and I have appx £16k of credit which i can easily afford. I have a good job with a good income and i now find that experian is telling me it means I have had credit problems which potentially is putting lenders off!

Is this fair??

opinions4u

Money saving tip of the day:

Stop paying for this service it means little in reality.

Pay your bills on time and stop worrying.

LisaB1970

My bills are always paid on time. The fact is I was declined 2 mortgages because my MA royally cocked up which has had a detrimental effect on my credit score, meaning im finding it hard to get a mortgage. So im not too chuffed that lenders may see me as a risk because they think i have credit problems which i most certainly do not!

So in reality it means a lot!

beecher2

When you say you have 16k of credit, do you mean 16k of debt? You may be failing on affordability with that amount of debt.

Thrugelmir

LisaB1970 wrote: »

d I have appx £16k of credit which i can easily afford.

As long as you have an income to meet the repayments . Misfortune hits many people everyday unexpectably. So statistically the amount of debt you have increases the risk to the lender.

kingstreet

Stop relying on the "score" you're given by Experian. It means nothing to the lenders you might apply to, who have their own methods of working out which borrowers they want, and which ones they don't.

Lenders can cherry-pick and will often do so. Those who would previously have been given a mortgage may now be rejected, as lenders pick the very best applicants for the limited funds they have available.

Sadly, this is not an exact science. It's impossible to predict who will pass on the day, and who will fail. Trying to anticipate problems is the best a broker can do and I'll hold my hands up and admit there have been times where I've ended up with two applications for a client because I didn't fully address an issue before I went ahead with the app.

Instead of approaching the household names who tend to use statistical analysis to decide their lending policy, why not approach a more local building society where each application is decided on its own merits. It may not get you the best deal, but it may put your mind at rest by getting you the mortgage you need.

Last thing, are you being declined altogether, or are you having the amount you wish to borrow scaled back, which is what normally happens with affordability issues?

opinions4u

LisaB1970 wrote: »

My bills are always paid on time.

Good.

The fact is I was declined 2 mortgages because my MA royally cocked up which has had a detrimental effect on my credit score, meaning im finding it hard to get a mortgage.

So can you prove that the searches have caused this?

Regardless, complain and insist that they remove excessive searches - quickly.

So im not too chuffed that lenders may see me as a risk because they think i have credit problems which i most certainly do not!

Has it not crossed your mind that you may have excessive unsecured debt, possibly a low personal deposit and could, in the eyes of potential mortgage lenders, not fit the profile of customer that they want?

In all truth a couple of searches will rarely make a difference to a real lender's real credit score outcome.

But don't miss the point that an Experian credit score means little unless you are looking to borrow money from them.

LisaB1970

opinions4u wrote: »

Good.

So can you prove that the searches have caused this?

Yes - it was a LOT higher before the searches and after the searches were done it dropped dramatically - i'd say that pretty much proves it.

opinions4u wrote: »

Regardless, complain and insist that they remove excessive searches - quickly.

Thankyou. I shall look into that

opinions4u wrote: »

Has it not crossed your mind that you may have excessive unsecured debt, possibly a low personal deposit and could, in the eyes of potential mortgage lenders, not fit the profile of customer that they want?

In all truth a couple of searches will rarely make a difference to a real lender's real credit score outcome.

But don't miss the point that an Experian credit score means little unless you are looking to borrow money from them.

I have a car loan and a credit car - thats all. I wouldnt call it excessive really. Thanks for the advice though.

Thankyou everyone :T

kingstreet

Lisa - I've been reading through your various posts on different threads to try to get a feel for the problem. I wish we had a "one thread per person" rule on here so I didn't have to search in a few differerent ones...

What did you do about your husband's situation? Did you make your new application in one name, or did you apply jointly again?

The reason I'm asking is you might have been declined because of a financial association on your credit file that wasn't matched by a joint app.

Can you answer my question about being offered something, rather than nothing from two posts back? Affordability is normally marked by a reduced amount offered, not by a rejection.

opinions4u

LisaB1970 wrote: »

Yes - it was a LOT higher before the searches and after the searches were done it dropped dramatically - i'd say that pretty much proves it.

You have completely missed the point. Who has provided you with these numbers that have "dropped dramatically"? How much have they charged you? Do they lend money themselves?

Think about it.

I have a car loan and a credit car - thats all. I wouldnt call it excessive really. Thanks for the advice though.

You mention £16k. You may not consider it a lot, but it may be something that concerns a mortgage lender.

Have you been declined mortgages? Or just offered an amount lower than you would like to borrow?

LisaB1970

kingstreet wrote: »

Lisa - I've been reading through your various posts on different threads to try to get a feel for the problem. I wish we had a "one thread per person" rule on here so I didn't have to search in a few differerent ones...

What did you do about your husband's situation? Did you make your new application in one name, or did you apply jointly again?

The reason I'm asking is you might have been declined because of a financial association on your credit file that wasn't matched by a joint app.

Can you answer my question about being offered something, rather than nothing from two posts back? Affordability is normally marked by a reduced amount offered, not by a rejection.

The new application was made in my name only. I apoligise for not answering your question I thought i had - I wasnt offered a reduced amount just declined outright on affordability. I had an idea the financial association may have had something to do with it too, i know santander searched my husband even though it was a single application.
We are going to sort out a few things tomorrow that should help straighten out my husbands file.

Opinions4u - i checked my credit score before I was declined the second time, and after I had been declined and it showed a drop (on Experian)
Agreed- £16k may be of concern to a lender, I accept that
And no I wasnt offered anythign lower, just declined completely - according to my MA......