How much longer to improve credit rating to get a bank loan.

ps10006

Hi all

I am new to this. Since the start of last year i have been working to improve my credit rating as i was suprised to get for an overdraft. I am now only 22 so it was a case of having not much of a credit history. Since then (18months), i have opened a mobile phone contract in which i pay monthly. I have 3 credit cards being Vanquis (1year), Capital one classic (1 year), Barclaycard initial (3 months). I use all credit cards every month and nearly always pay in full every month to avoid interest. I HAVE NEVER MISSED A PAYMENT on any of my credit accounts. I run my current account well, am on the electoral role, have a full time job for the past 3 years, have no ccj's or anything like that. In that period my experian credit score has risen from 430 to 846. I know the scores are bogus but it does indicate improvemnt over time.

However recently had a promotion which needs me travelling a lot across country to meet customers, and the 2grand i have saved is not enough to get a reliable, low milage car that will last me the next 4-5 years. What i want to know is if anyone has any idea of how much longer it will take me to be elegible for a high street personal bank loan of about £7000?

Thanks in advance.

john1002

How long is a piece of string really, nobody knows until you try. Best bet would be to start with your own bank as they have the most uptodate history on you. You don't want to make to many applications so i would find a loan provider who has the best rate and they would be your second point of call. If they both turn you down then I'm afraid it is a case of waiting a further 6-12 months and try again.

John

Tixy

Have you actually tried to get such a loan yet? how recently?

Given that you seem to be showing a reasonable credit history then I wouldn't think that your credit file would stop you getting such a loan. And as you are over 21 that shouldn't be too much of an issue.

The other possible hurdles might be how much you earn and what your total existing credit limits across your cards and overdraft (if you have one - I'm not sure from your post). If affordability is likely to be an issue for the banks (how much you want to borrow compared to your base salary) then perhaps you could apply for a lower amount, especially as you already have £2k in savings to put towards the car.

the-boss_2

Have you tried ZOPA for a loan?. They have a Young Borrowers rate i believe for Under 25's with little/Good Credit History.

KingElvis

Try the Nationwide quote thingy as it doesn't leave a footprint on your credit history.

ps10006

Hi, thanks for your replies. I have tried the nationwide quotation thing, and it accepted me but for the worst possible apr (24.9% i think). That is why I havnt actually tried recently with my bank as i just assumed my wothiness was poor due to nationwides high apr. I havent tried Zopa as i was under the impression it was only for people with good credit, unless i am wrong?

Mistake in my original post, i meant i was rejected for an overdraft. I have £1000 limit on barclays, £500 limit on both cap1 and vanquis. Currently my debt ratio is at about 15%. My income is pretty good for a 22yr old i think, i come out with about £1500 per month. Do people think then that i should first try with my bank (Natwest). The problem is that they dont even take into account my personal circumstances, they just hit the computor button and it says no.

the-boss_2

Zopa have a special rate for Younger Borrower's with limited Credit History. They also use the soft quote like Nationwide do.

Tixy

Is all your salary guaranteed - or is some of it commission/bonus?
If its a set salary of around £22k(?) then I would have imagined you would be able to get a loan given the other info you have posted, although I suspect not at the representative APRs that are advertised.
Have you already tried applying with natwest?

ps10006

Will have to look at Zopa then. My salary is guaranteed at a minimum of £1400, however we get monthly bonus's which are about £100-£200 per month aswell. However that falls just short of the £20000 a year mark... Job position is also safe too.

The last time i applied with Natwest was last december, rejected by them (again). Also you cannot appljy with natwest for at least 6 months of having been rejected, so i am just worried that i will be rejected, have a search against my name, and be in this same position for the next 6 months minimum.

Tixy

If you haven't made any recent applications (except the nationwide softsearch) then it won't affect your credit file to try another application.

Perhaps try reducing the amount you want to borrow a bit - you could get a decent reliable car for a lot less than £9k.

ps10006

That seems fair then. I dont know much about how banks go about lending, i just assumed that they check my credit rating/report to determine my worthiness, and then they decide if they will give me one or not i.e doesnt make a difference if it is a 3k loan or a 7k loan. So are banks actually more willing to lend smaller amounts rather than larger amounts?? To be fair it does make sense if they do..