Turned down for a HSBC loan

tonytone_2

Thanks for the replies everyone.

KirbyBirch wrote: »

You need to realise that having a Excellent score doesn't mean anything in the eyes of actual lenders you need to realise that excellent from Equifax,Experian & Call credit is excellent news to them at £15 a pop but for you is worthless. You need to look at the data your report shows

Hmmm, seems like it's all a bit of a rip-off then.
When you say the actual data in the report, I'm not quite sure what you mean. Under each sub-section, it obviously lists all the details, but it simply describes my status as excellent. The only thing that's less than excellent is the electoral roll which is classed as Good.

To be honest I'm suprised that Equifax etc get away with giving you a report that is of absolutely no use. Where's Anne Robinson?

clapton wrote:

just to be sure
when you say you have an existing loan a/c does that mean you have a current loan with HSBC , if so how much
do you use your overdraft
what are your current total debts
do you have credit cards

I have a current a/c, personal loan and credit card with HSBC. I also have a loan and credit card elsewhere.
I do have an overdraft which I use most months, but never go over the limit and have never missed a payment on any loan / credit agreement or mortgage.
My total debt is about £25k (including the £5k I was going to consolidate). I can't see that being an issue though as I passed the affordability test. If I couldn't afford to take out the loan it would have been caught then, otherwise what's the point in doing it? (The affordability test left me with about £500 a month expendable income after paying all my outgoings).

Saints2011

tonytone wrote: »

Thanks for the replies everyone.

Hmmm, seems like it's all a bit of a rip-off then.
When you say the actual data in the report, I'm not quite sure what you mean. Under each sub-section, it obviously lists all the details, but it simply describes my status as excellent. The only thing that's less than excellent is the electoral roll which is classed as Good.

To be honest I'm suprised that Equifax etc get away with giving you a report that is of absolutely no use. Where's Anne Robinson?

Afternoon, a lender will not see any score given by Experian, Equifax or Call Credit but what they will see is number of accounts open and balance vs credit limit. If you have any late payments, defaults ccj's how long you have kept the accounts open for and your behaviour in terms of paying of each month or carrying a balanace. They will also see previous search's (dont want many of these), electoral roll data how long you have been registered. As well as any cifas.

So basically :rotfl:just check this data and see if you have any late payments, defaults, ccj's what your balance is vs credit limit do you look over committed. Have you more than two to three credit search's in six months, how long have you been on e roll are you showing a lender stability + of course the lender will take into account details on your application form which doesnt show on your reports.

tonytone wrote: »

I have a current a/c, personal loan and credit card with HSBC. I also have a loan and credit card elsewhere.
I do have an overdraft which I use most months, but never go over the limit and have never missed a payment on any loan / credit agreement or mortgage.
My total debt is about £25k (including the £5k I was going to consolidate). I can't see that being an issue though as I passed the affordability test. If I couldn't afford to take out the loan it would have been caught then, otherwise what's the point in doing it? (The affordability test left me with about £500 a month expendable income after paying all my outgoings).

By using your overdraft this will show that you arent managing your day to day living and month to month living well so they will ask the question will we get our money back if you cant manage at the moment on your income

Apples2

tonytone wrote: »

To be honest I'm suprised that Equifax etc get away with giving you a report that is of absolutely no use. Where's Anne Robinson?

The Credit report is not worthless, the credit SCORE is worthless. I'm not sure how you managed to pay so much for it though, it should cost £2.
The report will show how reliable you are as a borrower.

The report makes no mention of your level of debt, salary etc so it is only a guide and forms one of many hurdles in front of you which the lenders consider.

tonytone wrote: »

I do have an overdraft which I use most months, but never go over the limit and have never missed a payment on any loan / credit agreement or mortgage.
My total debt is about £25k (including the £5k I was going to consolidate). I can't see that being an issue though as I passed the affordability test. If I couldn't afford to take out the loan it would have been caught then, otherwise what's the point in doing it? (The affordability test left me with about £500 a month expendable income after paying all my outgoings).

The red bit is going to be critical. If you are finding it necessary to use your overdraft each month, it suggests you cannot control your spending as you are reliant upon using the banks money for day to day expenses.

The blue bit is probably a misnomer. If you have £500 a month left over, why are you entering your overdraft most months.

Lenders don't take into account your desire to consolidate, they see it (and treat it) as additional borrowing. You can see from the above it doesn't look too optimistic that you could afford more outgoings with a new loan.

You're in good company with this frustration.

CH27

tonytone wrote: »

Thanks for the replies everyone.




Hmmm, seems like it's all a bit of a rip-off then.
When you say the actual data in the report, I'm not quite sure what you mean. Under each sub-section, it obviously lists all the details, but it simply describes my status as excellent. The only thing that's less than excellent is the electoral roll which is classed as Good.

To be honest I'm suprised that Equifax etc get away with giving you a report that is of absolutely no use. Where's Anne Robinson?



I have a current a/c, personal loan and credit card with HSBC. I also have a loan and credit card elsewhere.
I do have an overdraft which I use most months, but never go over the limit and have never missed a payment on any loan / credit agreement or mortgage.
My total debt is about £25k (including the £5k I was going to consolidate). I can't see that being an issue though as I passed the affordability test. If I couldn't afford to take out the loan it would have been caught then, otherwise what's the point in doing it? (The affordability test left me with about £500 a month expendable income after paying all my outgoings).

Why do you use your overdraft every month if you have £500 disposable income?

tonytone_2

Of the money I have left over each month, some goes into savings and some just gets spent on non-essential "stuff". Some months I'll save £50, some months I'll save £300. If I see something I like the look of I'll buy it if, even if that means dipping into an overdraught. (That's the point of having one isn't it??) Being the massive socialite I am (yeah right!) sometimes I may spend £200 a month on going out, sometimes I'll spend £40. It's not money that's allocated to anything that I HAVE to pay each month so it's pretty much expendable and why it wasn't taken into account as a monthly expenditure on my "affordability test". Sometimes I'll go into my overdraught by £10, sometimes by £100 - 300. There's no real pattern, but it's always money that I can afford as I get paid enough to cover everything. I'm never in my overdraught after getting paid.

If dipping in and out of an overdraught is what has caused the bank to turn down a loan application, then wouldn't most people in the country find it difficult to get loans?

Apples2 wrote:

The Credit report is not worthless, the credit SCORE is worthless. I'm not sure how you managed to pay so much for it though, it should cost £2.
The report will show how reliable you are as a borrower.

I paid for it online through the Equifax website. The price was £15... might have been £14, either way I'd be interested to know where you can get the same for £2!

The report itself showed that I have existing credit and have never missed a payment, have no CCJ's, have lived in the same address for 6 years etc. etc. There was absolutely nothing that I can see as detrimental in there.

Either way, the outcome is the same as there's nothing I'm going to be able to say / do that will change the banks mind. I guess I'll have to put it down to experience of failing the random number generator test (as the bank won't specifically explain ther reason for turning me down) and move on with my life.

Thanks all for your input.

CLAPTON

well you owe 25k and you asked for 15k so they would see that as 40k in debt on a 62k salary; that is truely an awful lot of debt in relation to your salary
I'm somewhat surprised they offered you a loan at all.

and you regularly go into the overdraft

and maybe pay only the minimum on the CC

while is used to be fashionable to regularly use the OD nowadays is generally seen as either spending above your means or poor financial management

you really need to look at your spending and cut down in a fairly major way; stop using the OD, starting paying as much as possible on the debt with the highest APR

Apples2

tonytone wrote: »

I paid for it online through the Equifax website. The price was £15... might have been £14, either way I'd be interested to know where you can get the same for £2!

http://www.experian.co.uk/consumer/statutory-report.html

or

http://www.equifax.co.uk/Products/credit/statutory-report.html

or

http://www.callcredit.co.uk/stat-report-online/

tonytone_2

CLAPTON wrote: »

well you owe 25k and you asked for 15k so they would see that as 40k in debt on a 62k salary; that is truely an awful lot of debt in relation to your salary
I'm somewhat surprised they offered you a loan at all.

I agree it's quite a lot. However, if I were unable to afford the loan then how come I regularly end up with about £500 a month that I either put into savings or fritter away? The thing to remember is that I passed the banks affordability test. If I failed it, then fair enough no problem, clearly a case of living above my means.

and you regularly go into the overdraft

and maybe pay only the minimum on the CC

while is used to be fashionable to regularly use the OD nowadays is generally seen as either spending above your means or poor financial management

I can quite easily take a few hundred pounds out of the savings I have and clear my overdraught and ensure that I don't go into the overdraught each month.
If I did that, would it be better to close the overdraught facility or is it better to keep it but not use it? What do the bank prefer to see?

you really need to look at your spending and cut down in a fairly major way; stop using the OD, starting paying as much as possible on the debt with the highest APR

What benefit does paying off my loans early give me? Yes in the longer term I will be better off as I'm not paying as much interest.
However on a month to month basis, I can afford to pay my bills, I'm left with enough money afterwards to spend on luxury items and my level of debt on a month to month basis is reducing. Yes it could reduce quicker, but as long as it's not increasing month on month then surely it's being managed?

Thanks all for your replies.

tonytone_2

Apples2 wrote: »

Equifax £2 credit report

Nice, so the £15 "credit rating" gives you absolutely nothing of any use more than the statutory £2 "credit report". What a rip off. :mad:

(I tried to post a link to the Equifax site, but I can't add links to my posts yet, but it's on the site as I'm sure you're aware.)