Credit rating apparently good...so why am I refused credit??

wadders77

Hi,

I am new to the forum so be gentle!!

My husband and I both have good credit ratings, mine is 800+ and my husband is not far behind. Apart from paying some bills late(which haven't ever showed up on the credit score) we have a good joint income (£60,000 between us) but we have four loans between us and 3 credit cards.

I was hoping to get a credit card with a low or even 0% interest rate so that I could transfer the balance from one or more credit cards to try and pay them off quicker. The last year has seen us declined for each of the 3 or 4 that we have applied for and then we receive cold calls from loan companies and credit card companies with extortionate APR rates (39% for some of the cards!!)

Does anyone know if this is because we have too much credit at present, is a consequence of late payments ot because we keep trying. And how can we make it better quicker as I want to pay my debts off as soon as possible but feel that the credit cards we have are sapping our finances (always maxed out and minimum payments).

Any advice would be very welcome:rotfl:

meer53

wadders77 wrote: »

Hi,

I am new to the forum so be gentle!!

My husband and I both have good credit ratings, mine is 800+ and my husband is not far behind. Apart from paying some bills late(which haven't ever showed up on the credit score) we have a good joint income (£60,000 between us) but we have four loans between us and 3 credit cards.

I was hoping to get a credit card with a low or even 0% interest rate so that I could transfer the balance from one or more credit cards to try and pay them off quicker. The last year has seen us declined for each of the 3 or 4 that we have applied for and then we receive cold calls from loan companies and credit card companies with extortionate APR rates (39% for some of the cards!!)

Does anyone know if this is because we have too much credit at present, is a consequence of late payments ot because we keep trying. And how can we make it better quicker as I want to pay my debts off as soon as possible but feel that the credit cards we have are sapping our finances (always maxed out and minimum payments).

Any advice would be very welcome:rotfl:

Think you've answered your own question really.

4 loans, 3 credit cards (maxed out and only minimum payments), missed or late payments, and 3 or 4 applications for new credit in the last 12 months. Depends on how much credit versus your income but it's not really surprising that you're being declined.

Think you need to have a look at where you can cut back to start repaying some of your debts and forget about trying to borrow more really. It's not going to happen Go to the DFW board and post an SOA for some help.

wadders77

Hi,

Thanks. I know that I should not borrow any more. I'm not sure if I am kidding myself that getting a 0% card would make it easier to pay off (which I am genuinely ready to do) or if it's not that simple.
We recently saved some money and tried to pay extra off the credit cards with it but the card companies told us that paying extra would mean our payments would be reduced accordingly. We have since increased our DD but it feels like it will be a lifetime to pay off. They don't make it easy for you do they!
(ps, I fully appreciate, as I am sure many do, that we have got ourselves into this situation and need to get ourselves out. I am just looking at making it as easy as possible!)

Thanks again.

arabellaB

A credit score in the United States is a number representing the creditworthiness of a person, the likelihood that person will pay his or her debts.

Lenders, such as banks and credit card companies, use credit scores to evaluate the potential risk posed by lending money to consumers. Widespread use of credit scores has made credit more widely available and cheaper for consumers.

We depend on credit for so many important things in life -- whether it's for buying a car, house or computer or getting a student loan. A three-digit number -- your credit score -- can determine whether you can do these things and even how much it will cost you.

camuk81

wadders, It sounds like at the moment you are just coping with a few late payments which you have been fortunate to not have recorded.

As Meer has said you probably have to much credit available and too much borrowed.

As regards over paying start with the highest APR first.

Try the below link to see where you can make a really impact on your debts:

http://www.whatsthecost.com/snowball.aspx

Also have a look at the next link and feel free to post in the Debt free Wanabee board

http://www.makesenseofcards.com/soacalc.html

Sometimes in the cold light of day you can see how much those coffee's and magazines actually mount up to. All in all cut back and pay back, you need to get file back on track and arabella has already said the credit score wether in the UK or US is a number. You have a good income but I'd be interested to find out the total debt amount I'm guessing you are near the 75% of your salary mark hence the decline.

Triple check your file with everyone but don't bother with the score and make sure everything is up to date and that there are no markers anywhere. Please remember there are 3 agencies and not all banks/ credit cards use the same one.

BugsyBrowne

arabellaB wrote: »

A credit score in the United States is a number representing the creditworthiness of a person, the likelihood that person will pay his or her debts.

Lenders, such as banks and credit card companies, use credit scores to evaluate the potential risk posed by lending money to consumers. Widespread use of credit scores has made credit more widely available and cheaper for consumers.

We depend on credit for so many important things in life -- whether it's for buying a car, house or computer or getting a student loan. A three-digit number -- your credit score -- can determine whether you can do these things and even how much it will cost you.

Unfortuantly a person will never ever know their true credit scores, credit scores could work as 1-10 rating with lenders where a 7 is acceptance we just don't know.

DominicJ_2

We recently saved some money and tried to pay extra off the credit cards with it but the card companies told us that paying extra would mean our payments would be reduced accordingly.

The minimum payment is just that, its usualy between 1 and 3% of the balance, plus interest.
As the balance decreases, the minimum payment decreases.
That doesnt mean you cant pay more than the minimum every month.

4 loans and 4 maxed out credit cards is a lot of open credit. Even if they are all small loans, which it doesnt sound like they are.

A proper Statement of Affairs (SOA) will get you the best responses, but as a rule.
Find out which credit card has the highest interest rate*, save every penny you can and pay it off as soon as possible.
Move onto the next highest rate, and so on and so forth.

*It occurs that there **could** be some benefit to paying off the smallest balance first, and playing balance transfer shuffle early, but it would need case by case working.

camuk81

Too true Dominic, I have to admit I paid a lower apr because it was a £200 balance and it was a fell good clear off debt. Now onto the harder one's

pheonixrising21

Are your credit cards maxed out? What are the APRs on them? If you have any sapre credit on the lowest APR cards, can you transfer some or all of the balance of the highest card to it?

If you can do the above, do it as it will reduce your overall interest bill.

Then, I would say the best way to do this is attack the cards in turn. Set up a DD for the minimum payment on the lowest APR cards. Then decide how much you can afford to overpay on the highest APR card and set up a DD for this amount. Once the highest APR card is cleared, move the set overpay DD to the next highest and so on.

E.g
Card1 - APR 25.9% - min payment £50
Card2 - APR 19.9% - min payment £60
Card3 - APR 16.9% - min payment £50
Budgeted additional payment = £100 per month.

Set up min payment DDs on all, except Card1, which you set to £150 until its paid off. then set up DD of £160 on Card2, etc, etc.

You may also want to include the loans in this, depending on if you can overpay on them or not and how much their APRs are.

JohalaReewi

wadders77 wrote: »

Hi,
My husband and I both have good credit ratings, mine is 800+ and my husband is not far behind.
.....
The last year has seen us declined for each of the 3 or 4 that we have applied for and then we receive cold calls from loan companies and credit card companies with extortionate APR rates

As has been said many times on MSE, the scores that you get from Experian, Equifax, etc. are just numbers. They are not actual credit scores because Experian (et al) do not offer credit.

As a result it is very likely that you get a high score from Experian but are still refused credit by lenders who calculate their own scores using much more information than Experian (et al) have.

Plus, even with a good credit history, you might not match the customer profile of the lender so you still get rejected. Have a look at Martin's article...
http://www.moneysavingexpert.com/loans/credit-rating-credit-score

arabellaB wrote:

A credit score in the United States is a number representing the creditworthiness of a person, the likelihood that person will pay his or her debts.
...
A three-digit number -- your credit score -- can determine whether you can do these things and even how much it will cost you.

This is the UK not the USA and here we don't have a single credit score, we have lots of different credit scores with different lenders all over the place. We also have credit reference agencies who produce numbers they like to call credit scores when they don't actually offer any credit.

[Deleted User]

arabellaB wrote: »

A credit score in the United States is a number representing the creditworthiness of a person, the likelihood that person will pay his or her debts.

Lenders, such as banks and credit card companies, use credit scores to evaluate the potential risk posed by lending money to consumers. Widespread use of credit scores has made credit more widely available and cheaper for consumers.

We depend on credit for so many important things in life -- whether it's for buying a car, house or computer or getting a student loan. A three-digit number -- your credit score -- can determine whether you can do these things and even how much it will cost you.

I wish I know how to cut and paste from Wikipedia to build my post count. Could you show me one day, Arabella?