Zopa. Neither a borrower nor a lender be!

malagamad

This is copied from their email and further in email they tell me to find out contact credit ref agency, I checked again on my credit file and it's still perfect so no signs of any ID theft as that had crossed my mind. However these are the reasons given, they say that word 'COULD' affect their decision. When you read this you can then compare that to my first post with the facts about my income, credit file and credit score.
Your existing level of unsecured debt - if you've already got high levels of unsecured debt then it's probably not wise to take on more.
Whether there is enough information on your credit file and the Electoral Roll for us to confirm your identity and make a safe decision.
The affordability of the loan - it's important that you can still afford to enjoy life while you repay this loan!
Your credit score as reported by Equifax.
Your credit report showing your ability to make payments on time for your previous and existing lines of credit.

malagamad

P.S Zopa have said they won't give specific reasons

jamesd

You may want to consider writing to the Office of Fair Trading at enquiries@oft.gov.uk and informing them of the refusal to give the main reason why credit was refused and ask whether it's right that lenders are supposed to be giving the main reasons. Zopa seems to systematically refuse to do so, which doesn't appear to be good practice.

paulus_the_woodland_gnome

malagamad wrote: »

Ok, so there are bitter people out there who get annoyed when refused a loan. I don't think I'm one of them, I'll let you decide, here's my story:

I was looking for a way to pay off a credit card with a loan and wanted low interest rates and found Zopa on the Internet. I liked two things about them, one their low interest rates and two, the ability to reward the general public rather than the fat cat bankers.

Here is my credit file in brief from experian and equifax. I have 3 credit accounts, they are a Barclaycard Platinum, A car loan with just 1 payment left to make and a second credit card. I also have a bank account with Lloyds which has an unused overdraft of £950. My credit score with both reference agencies put me in the top bracket and describe my chances if being accepted by finance companies as excellent. I have 6 years of on time payments with my 2nd credit card, 3 months of perfect payments with Barclaycard, a fully paid off car loan that finished 2 years ago (again with perfect payment record) and a car loan about to finish (also with a perfect payment record). My credit files show 6 years of on time payments made every month without even one missed or late payment.

The next thing for you to know is that I have outstanding credit of just 3% of my salary and my salary is £34000 per annum.

I have lived at the same address for nearly 8 years and have been a
Company director for nearly 3 years. My wife also has a perfect credit rating and is a teacher. She wasn't on this application as quite frankly she didn't need to be.

Anyway, I recieved an email about an hour ago from Zopa claiming that I have been declined a loan. So why have I been declined? I have no idea. I'd love to hear if any of you guys or even Martin might know why this was? Perhaps I am not spotting something in my notes about my credit above or maybe Zopa haven't got any money to lend. What have people's experiences been during July 2011? Has anyone been lent anything. Are Zopa lenders happy that people with my credit score are being knocked back. Let your feelings be known, I'd love to hear your opinions.

I know how you feel - We have very similar income/outgoings to you so applied for a small loan from Zopa in the belief that we were unlikely to be rejected due to low risk . Husband received one call to confirm loan was granted then received another saying that no offer was made . I was irked to say the least. This is the only time we have been turned down for credit and i was cross with my self for recommending OH apply to Zopa

jamesd

Worth remembering that Zopa's use of a quotation search means it's mostly harmless to try it. Same goes for Nationwide's new process. Most will probably get a better rate from Nationwide, but not always. And for a few thousand to perhaps ten thousand or more depending on income, 0% credit cards are going to be the best deal, if you can get a high enough limit.

malagamad

jamesd wrote: »

Worth remembering that Zopa's use of a quotation search means it's mostly harmless to try it. Same goes for Nationwide's new process. Most will probably get a better rate from Nationwide, but not always. And for a few thousand to perhaps ten thousand or more depending on income, 0% credit cards are going to be the best deal, if you can get a high enough limit.

Unfortunately Zopa don't tell you whether you are accepted before putting a search on your file. Thier website quotation doesn't conduct a search and it seems they have a very particular borrower in mind but god knows what that is if I can't get a loan with my credit record and score. I am still thinking they have no money at the moment.

the-boss_2

malagamad wrote: »

Unfortunately Zopa don't tell you whether you are accepted before putting a search on your file. Thier website quotation doesn't conduct a search and it seems they have a very particular borrower in mind but god knows what that is if I can't get a loan with my credit record and score. I am still thinking they have no money at the moment.

They seem to have over £4,000,000 to Loan out at the moment according to the site. I have a small loan with them and have a limited Credit History so was pleasently suprised to be accepted.

jamesd

malagamad wrote: »

Unfortunately Zopa don't tell you whether you are accepted before putting a search on your file. Thier website quotation doesn't conduct a search and it seems they have a very particular borrower in mind.

Zopa searches in this way:

1. An initial typical rate at the quick quote page. There is no credit search at this point. That page also shows that Zopa's borrower charge adds 1.4% to the APR of a £5,000 three year loan at the moment (the difference between 6.5% fixed and 7.9% APR, at the time I just looked).
2. If you click continue and give your personal details you'll be declined based on credit record or assigned to a market. A quotation search is carried out so that can be done. The credit reference agency that Zopa uses is one that I think says it does not report quotation searches to other lenders. You will still see it on a statutory credit report, though. At this point money is reserved for you from the lenders' pots.
3. A human then looks at the application. If accepted the quotation search will be converted to an application search that will be visible to other lenders. If declined the quotation search will be left alone. The reserved money will either be passed on to you or returned to the markets.

Most lending places do not use quotation searches. They go directly to application searches that will be visible to other lenders. That's part of why Zopa and Nationwide are relatively painless to try: they don't hurt your chances elsewhere.

malagamad wrote: »

I am still thinking they have no money at the moment.

See this page which reports the amount of money currently available across the markets at the bottom right. Not all of that is available to each individual but four million is plenty.

malagamad

All I would say is that My credit file flashed up a visible
Search. I was sent a text and email that told me significant changes have been made to my file. I then looked and Zopa's search was there as a standard search not a soft print. Also we as consumers shouldn't always believe figures quoted on a website. They say they have over £4 million in the pot but I could easily say that my company has 4 million clients but that isn't true.

I would like to know what it was in my application they didnt like, I've explained my situation earlier and have answered subsequent questions but can't figure it out.

If I was a lender, I'd be seriously worried and be asking questions as the-boss said earlier he/she was accepted with a limited history and was surprised to be accepted yet I've got an almost perfect score, account behaviour and rating but was declined. Lenders have to ask the question of Zopa, are they going for the kind of business that would make them more money rather than safe borrowing?

fallen121

I am a lender at Zopa with a 538 credit rating [as advised to me by Zopa when I became a lender in 2006]. I've built up my Zopa lending over 5 years by dribbling any funds I've got left over after paying my bills - sometimes as little as £3-£4 - into the Zopa account and re-lending any money I receive in interest.

Theoretically, I should be able to borrow on the A-B market [again, as advised by Zopa in 2006]. I have a good salary and no CCJs. I have lived at the same address for 20 years and have the same employer, just a better salary. My loans, mortgage and credit card debt is less than in 2006 [possibly unused credit on some cards may be affecting my creditworthiness].But I couldn't get a loan either! Reading this thread made me feel better because I now realise that I am not the only person with a decent credit history to be refused a loan.

What I can't understand is that some of the people I am lending to in the C or Y market (Y is young people with very little credit history) obviously have a lower credit rating than me and are either borrowing to buy 2nd hand cars or consolidating loans, but unlike me they don't seem to have any problem borrowing £10,000. I'm lending to them and I can't even borrow £5,000!

I'm not complaining and I only wanted to borrow because my Egg interest deal has expired and they're selling the debt to Barclaycard, so I wanted to pay it off. It just seems a bit odd, you would think that being a lender would help your rating, bit like a credit union, but obviously not. I think in the main my problem is that it is getting really hard to get good deals and I got too used to being able to borrow whenever I wanted, so it's a bit of a shock now that everyone is tightening their lending criteria - but this brings me back to the person in the C market borrowing to pay off his credit card - why him and not me? Isn't he affected by tightening of lending criteria too???