MSE News: A payday loan could cost you a mortgage

Former_MSE_Helen

"Lender GE Money will not approve a home loan application from a borrower who took out a payday loan in the past 3 months..."

Read the full story:
A payday loan could cost you a mortgage

KingElvis

At least that will shut up all the "I got a payday loan to buy a shoddy telly and it hasn't affected me in the slightest" brigade.

Plain common sense should tell you that no decent, vanilla lender would touch a client with these hideous things all over their credit history.

Glad we finally have it in black and white.

DCFC79

Let more follow suit

somethingcorporate

Agreed, a sensible lending policy.

Dave_Ham

This has been the case for the last 3-6 months and to be honest I thought it was already public knowledge.

I saw a client where he had several of these on the basis that he thought the additional credit lines would help him out, demonstrating he paid on time...

It is part of the vicious debt cycle to not surprised lenders frown upon it...

KingElvis

Most people used their common sense and guessed this would be the case however, there were many on here who were, shall we say, unconvinced.

!!!!!!, there were even people taking these miserable things to get £20 cashback...lunacy.

It doesn't take a genius to work out that the use of these things signifys poor budgeting, poor cash flow and living beyond your means.

chanz4

So Experian are now exploting by allowing them to single out those using payday loans.

JuicyJesus

chanz4 wrote: »

So Experian are now exploting by allowing them to single out those using payday loans.

Not sure how it's unfair. Payday loans are almost exclusively taken out by people who have not budgeted and are spending more than they earn, and at the same time have a !!!!!!!!ed enough credit rating that nobody else will lend to them. If you are coming up short at the end of the month often enough to need one payday loan, let alone multiple payday loans, it's no surprise that banks might consider you a bit of a poor credit risk.

Anyway, Experian are just reporting factual information. Banks can interpret it any way they like. A bank could consider a payday loan a big plus if they wanted to (no idea why they would, just for sake of argument), Experian couldn't give a toss as they just supply the data banks use to make a decision.

Consumerist

I wonder how long it will be before Experian starts to record your blood group, shoe size or IQ.

Knowing a customer's IQ could help a prospective lender no end.

~Brock~

Consumerist wrote: »

Knowing a customer's IQ could help a prospective lender no end.

It could work well on forums like this also

themull1

Why would a Bank/Building Society chance their money with someone who can't live from one month to the next?