Some advise please?

osmorgan

Hi can someone tell me where I'm going wrong? Recently my car started playing up, so I started looking into buying a new one, and getting a loan to pay for a nice car that won't fall to bits all the time. I have applied for a few but they all decline me for a £7300 over 4 years loan? I've checked my credit score on experian and it's "good", infact it's not far from "excellent" I am debt free at the moment, no outstanding debts. I have had some loans in the past but they have long been repaid. I'm earning £18,000 at the moment, so I can't see what the problem is? I'm at a loss. Can anyone advise? The people I've tried are Tesco, Sainsburys and Santandair. All declined, my household all have good credit also. What can I do???

Tixy

You say you have no outstanding debts, do you have any open unused credit - such as overdrafts, credit cards etc?

When checking your credit report (not the score the actual report) what credit accounts show on there, closed or open?

[Deleted User]

Do you have any other available credit (used or not)? £7k is a lot on your salary, so it may be an affordability issue, especially if you have any other credit kicking around.

osmorgan

I have no outstanding balance on my credit card. I do however have a 500pound overdraft that is 300pounds into it, but surly this can't go against me if it's an agreed overdraft?

Phelpsie001

No expert, but if I was the bank I'd assume:

£18,000 x 0.77 = £13,860/ 12 = £1155

So I'd assume your take home pay is £1155 after tax.

The repayments on the loan (even at 0%) would be around £150.

So that is approx 13% of your take home pay....actually that isn't too bad? There must be something that you are overlooking? An old bad debt you have forgotten about or run from? Or perhaps it is just the current financial climate....banks will only lend to people that they are 100% sure are good for the money....

Tixy

What is the limit on your credit card?

Do you use the overdraft every month? do you get the account back into credit at any point during the month?

osmorgan

That is probably what it is, I have two overdrafts, one of which goes out and back in each month, the other I pay into each month to pay it back, my credit card was at £1000 but I don't even think it's active any more, I cut it up long ago

KingElvis

osmorgan wrote: »

That is probably what it is, I have two overdrafts, one of which goes out and back in each month, the other I pay into each month to pay it back, my credit card was at £1000 but I don't even think it's active any more, I cut it up long ago

If those facts are true, I would imagine your credit history will have some significant "issues" and your chances of securing further credit are very slim.

YorkshireBoy

osmorgan wrote: »

I do however have a 500pound overdraft that is 300pounds into it, but surly this can't go against me if it's an agreed overdraft?

It shows other lenders that you can't manage your day-to-day/month-to-month finances, and also that you have absolutely no savings (because if you had, then you wouldn't be using an overdraft would you?).

They'll then be wondering, based on the above, where you're going to find the £150 (or whatever) monthly loan payment from.

osmorgan

KingElvis wrote: »

If those facts are true, I would imagine your credit history will have some significant "issues" and your chances of securing further credit are very slim.

I don't have any issues apart for the overdraft, I have had a few loans in the past which were all paid off on time.

Experian_company_representative

Did you try asking the lenders who recently said no why they refused your applications? Worth asking as they're the only ones who can tell you.

James Jones