Applying for loan after refusal

Deerbrook

My husband has just had a loan declined by Sainsburys (although they have given him a number to call for acceptance of a loan with APR of about 17% from a sister organisation) Applied for 6.8% originally as advertised.

Looking at finances again, we could probably sort the money out differently and he could apply for less money (still needing £10k instead of 14k). Is it worth speaking to Sainsburys again regards this, or will it just be classed as another application and another credit check?

Also, when is the best time to approach another lender following a decline, as dont want to mark too many searches on the credit file?

Thanks. Any advice welcome.

CH27

What is your income to debt ratio?

Deerbrook

Current debt is 38%. This loan is for debt consolidation, so if they include that as well, it would be 76%. Applying for £10k instead of total would be 64%.

What is considered to be too high? He just wants to clear credit cards onto a loan with lower APR and cut up the cards, so the high percentage ratio would only be for a matter of allocating the money to the appropriate card.

wallymcdonald_2

Have you got your own home,you could remortgage for 20k

Deerbrook

I dont want to add this to our mortgage.

Clive_Woody

Deerbrook wrote: »

Current debt is 38%. This loan is for debt consolidation, so if they include that as well, it would be 76%. Applying for £10k instead of total would be 64%.

What is considered to be too high? He just wants to clear credit cards onto a loan with lower APR and cut up the cards, so the high percentage ratio would only be for a matter of allocating the money to the appropriate card.

50% is generally seen as an upper limit for debt to earning ratio, but in the current climate that may be hard to achieve without a perfect credit history and a lender in a good mood.

lindens

why not try snowballing on his credit cards instead and pay them off that way, no loan required.

Deerbrook

lindens wrote: »

why not try snowballing on his credit cards instead and pay them off that way, no loan required.

Clive_Woody wrote: »

50% is generally seen as an upper limit for debt to earning ratio, but in the current climate that may be hard to achieve without a perfect credit history and a lender in a good mood.

Thanks to you both. I think a loan for 17% is too much and we will look at other ways to resolve it. Snowballing might be an option.

TPG_2

On a similar theme, I'm looking to consolidate the same sum (£14k), I've tried one or two places and the loans have been agreed in principle but never at the advertised rate (obviously no real explanation is given as to why this is the case). I recently checked my credit report and its fine, never missed a payment; this is the only debt I have; I earn a decent wage and there's equity in the house - I just don't get it?! My partner is in a pretty-similar situation to me except with no debt at all, she applied today instead and the exact same thing happened to her! I'm starting to wonder whether the advertised rate exists or whether it is just a useful hook to bring in new business?! Problem is that every application has a knock-on effect on the credit status so its starts becoming self-perpetuating.

I think my question is, does anyone know of a lender that is generally good at honouring their advertised rates to the masses?

Any help much appreciated

Clive_Woody

TPG wrote: »

I think my question is, does anyone know of a lender that is generally good at honouring their advertised rates to the masses?

Advertised rates go to 51% of succesful applications, the rest get a higher rate or a no thank you from the lender.