Keep getting refused but don't know why!

sunnyday88

Need some advice! I have applied for three credit cards in the last 10 months (careful to leave at least 3 month between each application) - the post office, barclaycard and virgin, and been refused for all three. I did a credit check a while ago and my credit rating was 760 so I should be relatively ok. I made sure I enrolled on the electoral register (only been in my flat for 8 months), I'm never late with bills, I already have one credit card but it's my student card with lloyds and there's only £430 on it. I am in my overdraft but I am employed full time and earning decent money and have been for a year. Have just sent off for another credit report, and used every single address from the last 15 years, just in case (I never received post at my university addressed, all my bank statements got sent home and forwarded so when applying I haven't mentioned those addresses)

Does anyone know what the problem could be? Is it just that I wouldn't make them any money?? :think:

izools

How old is your oldest account?

How old is your newest account?

How long have you held your bank account for?

How long have you had your current job for?

Have you every missed any payments or been late?

sunnyday88

I have had my lloyds current account for 6 years (it is now a graduate account) I also hold ISAs with nationwide and a small independent building society and have had them since I was much younger - 12 years at least. I have been at my current job for 10 months, and before that was holding down 2-3 part time jobs all the way through university. I missed one payment on my student credit card right at the beginning (2 years ago) but I learnt my lesson and set up a direct debit and have never missed one since. Though I have only been paying the minimum as my other bills tend to take priority...including owing my parents substatial amounts.

Hazzinho

How far into your overdraft are you? Are you always in it? What is your combined debt as a percentage of your annual wage? More than 50% is a reason. Have you any payday loans they are a negative for you report. also have you checked all 3 agencies file on you?

lee1985

Do you have any other accounts?
Does your graduate account have an overdraft? If so what is the limit and what is your balance?

Only making the minimum payment isn't ideal. There is nothing wrong with it and sometimes it is good for making the lender a profit but other times it can often make the lender assume you are having difficulty with finances (as you said most of your money goes on priority bills so it would be fair to assume that)

Also, the fact that you've been in your current job for less than a year does affect your stability which also forms part of the credit scoring process.

If you don't have any other accounts then the reason why you've been refused is probably here in the following link (another thread on this forum) https://forums.moneysavingexpert.com/discussion/3447003

It boils down to the fact that you don't have much of a credit history (a 6 year credit history in the form of a bank account doesn't count - it has to be either a credit card, a loan or a mortgage) and that is the most important factor when dealing with prime lenders.

sunnyday88

My Graduate account is my main account, and though getting paid every month takes me close to being out of it, by the end of the month I'm usually back down to -£1400 or so (the limit is -£1500) so it's not great. I have a couple of ISAs lurking but no other current accounts. I have no payday loans, my only debt is to my student credit card (£400ish) my overdraft and my student loan...and my dad! I don't fancy taking any of the credit-building credit cards as the interest rates are so huge, so do you think the best way would be to make more of an effort to pay more than the minimum off per month?

izools

Certainly there are some risk factors in your profile -

Moved recently
New job recently
Near limit on Overdraft
Near limit on Credit Card
Only paying Minimum

Unfortunately you'll be viewed as both unstable (due to first two points) and suffering debt stress (due to last three points).

Once you've managed to get your bank account operating mostly in the black, have spent a while paying well over the minimum on your credit card, and have got in to the habbit of keeping your CC balance well within it's limit, you'll be a better prospective borrower. Unfortunately you look a bit risky as it stands

EDIT: If you have only £400 on your credit card - would it not be best to pay it off in full, and continue to do so every month, and use the card for your day to day shopping - groceries etc? This way, you're paying no interest and showing some responsible use of credit facilities.

Also, it might be worth calling the bank and reducing your OD limit by £50+ each month (whatever you can afford) to bring down that debt as you can.

opinions4u

I did a credit check a while ago and my credit rating was 760 so I should be relatively ok

Hope they didn't charge you for that number.

By the way, most people seem to come out at 999. So 760 isn't "relatively ok".

KingElvis

Also you seem to be applying for "prime" cards so maybe you should start a little further down and go for a Cap One or Initial?

sunnyday88

opinions4u wrote: »

Hope they didn't charge you for that number.

By the way, most people seem to come out at 999. So 760 isn't "relatively ok".

No they didn't charge me for that number, it was a free credit check through Experian, who apparently class on their chart under 680 as 'poor' and 780 as 'good' so I was bang between the two at 'standard'. Apologies if I seem a bit naive, but I doubt very much that 'most people' come out at 999.

Anyway, I think you're right izools, I am a bit risky. It's tricky when everyone makes it sound so easy! I'll increase the payments on the credit card so I can start using it again gradually and maybe build up my rating a bit better.

Thanks for help all.

Fruit_and_Nut_Case

sunnyday88 wrote: »

Apologies if I seem a bit naive, but I doubt very much that 'most people' come out at 999.

Have a rummage around old posts and you'll find that a remarkably large number of people do.