How can I find out my total credit available?

haz_bow

How can I find out what the total amount of credit is that I will have available?

I'm guessing there are only so many loans and credit cards an individual can have?

i.e. I earn £40k a year. My total credit based on income and credit rating is £20k. If i have a credit card with £5k limit the most I can be offered with a personal loan is £15k? Is that how it works?

The reason I ask is because I have a mortgage and would like to get a personal loan to refurb my kitchen. I am also looking to get a new car on Finance. I can definitely afford both but I don't know if I'll get both as I'm assuming there must be cap on the total amount I can borrow across different loans/finance/credit cards etc but have no idea how to find out how much.

I have looked on experian but can't see it there.

I hope this makes sense.

Can anyone help me understand how it works and if this is something i can find out?

guesswho2000

haz_bow wrote: »

How can I find out what the total amount of credit is that I will have available?

I'm guessing there are only so many loans and credit cards an individual can have?

i.e. I earn £40k a year. My total credit based on income and credit rating is £20k. If i have a credit card with £5k limit the most I can be offered with a personal loan is £15k? Is that how it works?

The reason I ask is because I have a mortgage and would like to get a personal loan to refurb my kitchen. I am also looking to get a new car on Finance. I can definitely afford both but I don't know if I'll get both as I'm assuming there must be cap on the total amount I can borrow across different loans/finance/credit cards etc but have no idea how to find out how much.

I have looked on experian but can't see it there.

I hope this makes sense.

Can anyone help me understand how it works and if this is something i can find out?

You can't - simple as. There's no specific formula and it depends on a number of factors, loosely based around the magical formula each lender applies.

You'll also find that with higher salaries lenders tend to lend higher proportionate amounts; I can see the logic here, since in general bills don't increase with salary (for example, my council tax is the same whether I earn 20k or 100k). Certain lenders will also base decisions on your history with them, such as the bank where your salary gets paid, as they can see first hand what your income and outgoings are.

So, long story short, there's no cap other than that imposed by the lender, which may be different to another lender, and certainly no way to find out what that cap is unfortunately, otherwise some people would borrow the maximum they could

bigadaj

OP you are broadly correct but the exact numbers will vary. For example if you take a car on finance then ther is an argument that. This is partially secured on a car value so you may be able to get a little more than half your salary on non mortgage borrowing.

The easiest thing would be to prioritise your borrowings, and once getting knocked back leave any more applications for a few months, otherwise be conservative in your applications, both in number and value.

Apples2

haz_bow wrote: »

The reason I ask is because I have a mortgage and would like to get a personal loan to refurb my kitchen. I am also looking to get a new car on Finance. I can definitely afford both

You also need to be very honest with yourself ( lenders have their own mechanism for deciding this on your behalf).
Despite you perceived wealth, where are your savings?
Where does all the money go which makes it easy to take on both a car on finance AND a loan for some home improvements?

If your aren't sticking £600 a month into a savings account now, the lender may not consider things as easy and simple as you do.

dealer_wins

OP if you can afford both a new kitchen and car, then save up for them and buy them in 2 or 3 years time. It will save you £1000s compared to borrowing money for them now!!

Its the secret to financial freedom!!

opinions4u

There's no rule book her. Every lender is different.

But if you can afford a loan, save up instead.