Sainsbury's loans

stroudjames

Hello!

It's my first time posting, so apologies if this has been asked before.

I was wondering if someone could explain to me how this works. I applied for a Sainsbury's loan yesterday, as the APR was advertised at 6.8%. After filling in all my details and contacting Sainsbury's to go through with it, I was told that the APR would be 7.9% based on my Credit Rating.

I looked at my credit rating today (through privacyguard) and I was scored 'excellent' (975/999). This score was said to be in the 1% for borrowing, so I can't work out how Sainsbury's justified whacking the rate up to 7.9%.

Any explanations would be brilliant!!

Thanks!

TonyMMM

Because credit "scores" are meaningless to them (and most lenders). They use their own criteria to assess your creditworthiness/risk and offered you a rate (quite a good one actually) accordingly.

stroudjames

Thanks, that makes sense

fishty

I applied for a sainsburys small loan yesterday advertised at 8.5% and was given 8.4% - I found it very strange for it to actually go down??? Unless I miss heard. Anyhow, paperwork is arriving tomorrow so i'll find out then.

moneybags100

Hi yes I agree. I applied for a loan advertised at 6.9%.
I too was offered only 7.9%. Why? they can't tell me.
I am just finishing a loan with them that I have paid regular as clockwork, own my own house, good salary, steady job, so what is their issue?
The call handler said he'd seen quotes much higher. Just how many loans have they actually granted at this rate?
Has anyone else had this problem?
Looks like advertising one thing and offering another to me. This is very bad as you may them have to make more applications to get your loan which doesn't help your credit score.
I have also applied to M and S so will tell you how that goes.

KingElvis

moneybags100 wrote: »

Hi yes I agree. I applied for a loan advertised at 6.9%.
I too was offered only 7.9%. Why? they can't tell me.
I am just finishing a loan with them that I have paid regular as clockwork, own my own house, good salary, steady job, so what is their issue?
The call handler said he'd seen quotes much higher. Just how many loans have they actually granted at this rate?
Has anyone else had this problem?
Looks like advertising one thing and offering another to me. This is very bad as you may them have to make more applications to get your loan which doesn't help your credit score.
I have also applied to M and S so will tell you how that goes.

Thing is, now you've applied and been searched for two loans that will probably lead to a worse APR with M&S and so on as you keep applying.

Searches count towards a credit score with lenders.

danouk

When they quote a Representative APR it means that they must offer this rate to at least 51% of successful applicants. It used to be Typical APR, which meant that at least 66% of successful applicants got the advertised rate - you can thank the EU for the rule change which came into effect 1st Feb.

I'm sure they could tell you, but they don't want to and aren't required to. Just like you don't have to accept their loan offer.

fishty

I got my paper work through this morning and they have offered me a loan with an apr LESS than what was advertised. On thier web site it offers a small loan at 8.5% however I was given it at 8.4%. Not a lot in it but I did not expect that! I've had my fair share of adverse credit history including ccj's and defaults - going back a few years though. Even when I was filling out the app form I was half expecting to be declined.

As for the 7.9% you have been offered, in this climate aint a bad offer if you've had other searches on your file.