Refused Tesco personal loan due to having a payday loan on my bank statement

Apples2

Bedsit_Bob wrote: »

Does a PDL stay on your Credit File forever?

Only 6 years.

[Deleted User]

Even if it wasn't defaulted, and was paid off correctly?

Apples2

A Credit File is a history of your credit agreements, everything is recorded within it, loans, mobile contracts, BNPL deals (as long as the company report it to them of course which they should do).

It isn't just bad stuff, the whole lot to enable lenders to build a picture of you.

BugsyBrowne

I wouldn't loan money to a PDL borrower whether they've paid on time or not its a sign of distress within your financial status.

Also lenders I'm sure look at PDL borrowers as customers who have failed to get credit from their own banks which doesn't look good.

JuicyJesus

Payday loans are, or at least should be, lenders of last resort. Using them implies you have run out of all other sources of cash, and didn't plan your finances to budget for all necessary expenses.

No surprise lenders don't like them.

dealer_wins

Does anyone bother to save an emergency fund these days?

Treadmill

BugsyBrowne wrote: »

But surely you using a different bank for statements wouldn't make any difference as manual intervention will see PDL's scattered on your credit files.

I'm also pretty sure PDL's flag up now when lenders score your application.

I just recently had to send Barclaycard statements they requested, I don't know how they work it to be honest but I was happier with the fact that there where no PDLs on these statements. I was approved for the 25 Month balance transfer card, don't know the limit yet.

My main account is with First Direct and they have declined me a Loan in the past, reason given PDLs. So as I believe they go on the info they have about your account rather than CRA reports.

Treadmill

Apples2 wrote: »

Surely the entire system you have in place is specifically to take out PDL's and not repay them (to protect your real money when you don't repay)?
Can't argue with that.

Not at all I have never missed a payment of any kind in my life and never intend to, regardless of who I borrow from.

I have used PDLs in the past short term because I have been skint because of gambling (exactly what they are designed for I guess) but always paid back.

As far as emergency savings go, I put my savings down on my house (35k) in 2008 and sadly spent from 2009-2012 gambling to such an extent that I ended up without a pot to urinate in. Fortunately after my mortgages and all other bills including food and petrol etc I'm left with about £1200 so I am building some up now.

spinningsheep

Although a PDL will be on your credit file for 6 years, after what period of time would the entry cease to be of any consequence? ie the loan was repaid on time etc, no arrears, obviously lenders look back the full 6 years in some cases but others maybe only concerned with last say year or 2?

If this is common practice now and lenders/CC etc do not like to see these PDL on your credit history, rightly or wrongly, should this warning not be made clear in the small print where the shocking APR is shown that "taking a payday loan can seriously affect your ability to gain credit in the future"?

BugsyBrowne

Having PDL's on your credit report is like going on TV's Apprentice wearing a dirty shell suit.