Loans with good credit

mac_plas

Little background about myself.

25
Live with parents same address for 10 yrs
Have been self employed since 17 yrs old

Profit has varied and grown over the years around £12,000 when I was younger and eventually between £18,000 and £26,000 in the last few years of being self employed.

Now in full time employment for 3 months, but have had a regular income for months before that while I was self employed.

Current earnings are £1300 p month net at the moment.

£5,000 saved in isa
£1-1.5 k in current account
2 empty savings accounts
All with rbs which I have banked with for 8 yrs plus a credit card with £2000 limit that I haven't used and had for 2 years.
Excellent score on experian 900+
Loan of £1000 from 2008 paid back within 4 months.
Missed 1 direct debit in march 12, as I was abroad for 2 months.

I applied for a rbs loan of £8000 and after 2 weeks, I was refused. The money was for a new vehicle and the sale of my older vehicle would have paid into the loan and brought it down to 5k, I wanted to bridge the sale of my old vehicle with the purchase of new vehicle and not eat into savings.

Reason they gave was that I had not been employed for long enough but I felt that I have shown I can earn money self employed or employed, there has been a steady stream coming in for 8 yrs.

Is this the norm at the minute?

Thanks in advance.

CLAPTON

being emplyed for only 3 months may well be the reason
but also 8k is fairly high compared to your income

and best to use you credit card regularly for thing you buy anyway (say petrol) and pay in full each month as this help to build /maintain your credit rating.

and without knowing your full circumstance, being 25 and living at home and having been earning for 8 years you really ought to have alot more than £5k saved up

[Deleted User]

ask yourself 2 questions,how much is the isa paying in interest?and how much will the apr be on a loan?
you should use the savings then every month save the equivilant of what the repayments on a loan would have been

lifebeginstoday

Savings don't show on affordability levels for a new loan. neither does a positive in your current.

Have you any prof of borrowing recently and paying off?

If not then i suspect your not that attractive as a customer:(

mac_plas

Yes I can appreciate I should have more saved up, but I paid out 8k this year to take my girlfriend to NZ to see her parents who she hasn't seen for four years,

The current wage is pretty poor but it is looking to rise to around £5-600 net per week, the reason is I'm trying to get rid of my van which I used for my business as I have a company van now, and have 2 vans sat on the drive.

I thought they might have took into consideration the fact I was earning prior to being employed.

I have had insurance to pay for the last 6 years on the van which started out at £2000 per year and is now around the £800 mark, most years were on pay monthly basis and always paid on time every month, just seems pretty poor that I have banked with RBS and don't seem to be obtains any credit even though I have a good record of managing my money.

The fact I have 0 debt and a little savings and a regular income and have done for years seems to work against you/me

I won't use the credit card as I only have it for emergencies.

I think I have been quite smart with my money, don't you agree?

Many thanks mac

Apples2

There's nothing inherently wrong with what you have done with your money but most self employed struggle to get credit, this is a simple sign of the times. Small businesses go under everyday so it cannot be used as a measure of future income (not from a risk basis anyway).

The bigger picture is the fact that your current living conditions suggest your outgoings should be at the lowest you will EVER encounter.
Most people will move out of their parents at some stage, a stage you are most likely close to so your outgoungs are going to rocket.

Consider your current job is new, you may not even be passed the probationary period so will not be considered in stable employment.

This leaves you looking like a fairly bad risk. Now factor in a missed payment and it gets worse.

The interest rates between saving and borrowing has been mentioned. It is madness to pay so much interest when your savings attract so little.

Credit files are very useful, credit scores are completely worthless so ignore any random numbers a company who doesn't lend money award you. I've given you a core of 400 so you cansee now why you were declined.

CLAPTON

mac_plas wrote: »

Yes I can appreciate I should have more saved up, but I paid out 8k this year to take my girlfriend to NZ to see her parents who she hasn't seen for four years,

The current wage is pretty poor but it is looking to rise to around £5-600 net per week, the reason is I'm trying to get rid of my van which I used for my business as I have a company van now, and have 2 vans sat on the drive.

I thought they might have took into consideration the fact I was earning prior to being employed.

I have had insurance to pay for the last 6 years on the van which started out at £2000 per year and is now around the £800 mark, most years were on pay monthly basis and always paid on time every month, just seems pretty poor that I have banked with RBS and don't seem to be obtains any credit even though I have a good record of managing my money.

The fact I have 0 debt and a little savings and a regular income and have done for years seems to work against you/me

I won't use the credit card as I only have it for emergencies.

I think I have been quite smart with my money, don't you agree?

Many thanks mac

I'm confused

if you now have a company van why do you need a loan of 8K ?

worried48

Apples2 wrote: »

There's nothing inherently wrong with what you have done with your money but most self employed struggle to get credit, this is a simple sign of the times. Small businesses go under everyday so it cannot be used as a measure of future income (not from a risk basis anyway).

Which is odd really, because people get made redundant every day too, including from well established companies (Comet. Woolworths ...) Small self -employment businesses where there are few outlays because you work from home and many customers - businesses such as plumbing, mobile car repairs, music teaching, child minding and so on - get treated exactly the same way as businesses that are clearly vulnerable such as convenience stores and bakers which can be ruined in very short order by the opening of a Tesco Express or Greggs (several have been ruined round here because those two opened nearby)

But of course the computer is always right

CLAPTON

worried48 wrote: »

Which is odd really, because people get made redundant every day too, including from well established companies (Comet. Woolworths ...) Small self -employment businesses where there are few outlays because you work from home and many customers - businesses such as plumbing, mobile car repairs, music teaching, child minding and so on - get treated exactly the same way as businesses that are clearly vulnerable such as convenience stores and bakers which can be ruined in very short order by the opening of a Tesco Express or Greggs (several have been ruined round here because those two opened nearby)

But of course the computer is always right

I believe the usually accepted figure is that over 80% of new businesses fail within a year.

mac_plas

I have a company van for work only,

Sorted now, thanks for replies