Personal Loan Advice

joeyd75

Hello everybody,

I have posted here before some time ago, but seem to have forgotten my log in details etc, so have re-joined under a different username so thought I should introduce myself again

I would like some advice on applying for a loan if possible?

I currently have a company car, but as from April my employers are changing the method for my car benefit (as I am now mainly office based) They are getting rid of my lease car within the next few weeks and are insead giving me a £4k payrise so that I can arrange my own vehicle and charge mileage to the company if I need to use it for work. The idea behind this was to arrange my own lease, or get a loan and buy a car.

So, we decided to go for a £15k loan and buy a car outright (also giving us a couple of grand to play with for our wedding in July - which would be very useful!)

The timing is quite good for us as I am due to make the last payment on my personal loan on the 1st April. My loan was with my bank and was for £12k. I paid this off over 5 years at aprox £300/month.

I spoke to my bank earlier about obtaining another loan and thought I would have no problems, unfortunately they have declined to offer.

I really don't know what to do next. If my bank has declined my offer (HSBC) does this mean that most other companies will also decline?
I don't want to start applying for loans willy nilly incase it affects my credit rating

Is there a good way to go about this?

Sorry for the essay!!

BugsyBrowne

joeyd75 wrote: »

Hello everybody,

I have posted here before some time ago, but seem to have forgotten my log in details etc, so have re-joined under a different username so thought I should introduce myself again

I would like some advice on applying for a loan if possible?

I currently have a company car, but as from April my employers are changing the method for my car benefit (as I am now mainly office based) They are getting rid of my lease car within the next few weeks and are insead giving me a £4k payrise so that I can arrange my own vehicle and charge mileage to the company if I need to use it for work. The idea behind this was to arrange my own lease, or get a loan and buy a car.

So, we decided to go for a £15k loan and buy a car outright (also giving us a couple of grand to play with for our wedding in July - which would be very useful!)

The timing is quite good for us as I am due to make the last payment on my personal loan on the 1st April. My loan was with my bank and was for £12k. I paid this off over 5 years at aprox £300/month.

I spoke to my bank earlier about obtaining another loan and thought I would have no problems, unfortunately they have declined to offer.

I really don't know what to do next. If my bank has declined my offer (HSBC) does this mean that most other companies will also decline?
I don't want to start applying for loans willy nilly incase it affects my credit rating

Is there a good way to go about this?

Sorry for the essay!!

So when HSBC looked at your credit report they see you had a 12k loan and you applied for a 15k loan?

KingElvis

Well, tempting though your offer may have been I'm not suprised HSBC declined it.....

joeyd75

The £12k loan I had with HSBC will be paid off next month, I only have one outstanding payment left for it (haven't defaulted etc)
It was a loan we took out when we bought our house 5 years ago to do some renovations
Do you think that they may still have registered even though the loan will be finished next week?

The chap on the phone said that they know I only have one payment left and that it shouldn't affect my new application

He didn't know why it had been refused as he said nothing came up to show a bad credit rating etc

joeyd75

KingElvis wrote: »

Well, tempting though your offer may have been I'm not suprised HSBC declined it.....

Why do you think they declined it? Really, the payment amount is pretty much the same as what I have been paying for the last 5 years so surely it would just be a continuation of that?
Plus, my wage increase would cover the loan so my account will be approx £350 better off now my previous loan will be finished (£650 ish better off without a new loan)

I don't have an overdraft and keep in credit every month

CLAPTON

what's your income
what other debts do you have (CCs, OD)

joeyd75

My income will be about £30k with my payrise

I have 2 credit cards, one about £1,200 with HSBC and another about £2k with RBS
Usually both credit card balances are paid off monthly, but with our wedding approaching we have spent a little more on them recently

Other debt is our mortgage, again no defaults or late payments

Actually, thinking about it I have about £50 on a next account which I was 2 days late with clearing - do you think it could be that?
Usually, I clear this monthly too

BugsyBrowne

joeyd75 wrote: »

My income will be about £30k with my payrise

I have 2 credit cards, one about £1,200 with HSBC and another about £2k with RBS
Usually both credit card balances are paid off monthly, but with our wedding approaching we have spent a little more on them recently

Other debt is our mortgage, again no defaults or late payments

Actually, thinking about it I have about £50 on a next account which I was 2 days late with clearing - do you think it could be that?
Usually, I clear this monthly too

So at the time of HSBC looking at your report you had 3.2k of debt and wanted to borrow 15k,which will put you in a 18.2k debt with a 30k salary.

joeyd75

Yep, thats right
Do the figures for that not add up? Sorry, I don't really know much about what companies look at to judge your accountability

I just presumed that it would be a go-er, especially as they lent me £12 5 years ago on a much lower salary with bigger credit card debts at the time (that we cleared off)

redqueen_2

it might have been preferable to wait until your current loan was repaid but considering that the lending criteria has tightened up in light of the current econony it is more likely that a gross income of £30k is no longer sufficient in terms of 'affordability' on a £15k loan in the bank's opinion. Regardless of how good your credit rating is and the beneficial fact that you are a homeowner. its also net oncome, and employment status that are other key criteria. Arrange to see your branch manager and ask for an explanation regarding the loan decline. it may be that you have to wait 6 months and try again. Your bank is the best place to start, then the likes of Tesco and Santander are good unsecured lenders - don't be tempted by brokers.

andy.m_2

Times are harder all round.

You may have been worth a punt to HSBC before, not so now.