Reason for Decline

RGJC

My wife was trying to buy a new car in her name and was declined by the car finance company. Its a major brand, so its their own finance company. We are investigating her experian record and making improvements. But its hard to know, as the Finance company will not state the main reason for turning her down. I asked the Salesman to speak to his area manager, which he did, but he was told by the Finance branch, we don't discuss reasons for decline due to the data protection act. i.e. she could be anyone on the phone. Whilst I am sure that their ethical standards are laudable, it sounds more like covering their a**e. They don't even offer to write a letter for the reason.

My wife is now a british national, here since 2007 and British since 2011. The real kicker is my wife has £20,000 in the bank, but wants to improve her credit score. She doesn't have any settled accounts cos she has never had a loan. She has 2 phone contracts, 2 credit cards, one for her business (which doesn't appear on Expeian or equifax) and one personal which is recent. So revolving credit under 10 months. But you have to start somewhere. She has a Job, £25000 a year and runs her own company, £12000 a year or so. I earn £40000+ a year, but my help is not an option. It seems for now, we need her to get some credit under her belt, so we are thinking about getting a smaller loan, maybe from the bank for £3000 over 2 years and putting in £5000 to get the car she wants, assuming the banks will play ball.

Whats really difficult to understand, is which of the things are affecting her most. ie.
She has a Cifas on her record, as she was a victim of debit card cloning. There are several cerdit searches against her which are erroneous and we are in the process of having them removed.
She doesn't own the house we live in, I do and she is not named on the mortgage.
She has never had any credit other than Cerdit cards, and Phone Contracts. All bills are in my name.
She has only been on the electoral role 1 year 8 months (which equifax says is an issue), though she has lived in the house since arriving here in 2007.
She has a financial link to me, which is maybe not great, in that I still have some Defaults (6) from 2008/9. I actually still owe about £44000, but it was from my previous marriage and nothing to do with my wife, I have paid off about £43,000 and should have the rest paid off in another 6 years, however is the link to me affecting her?
We have a Joint account which we don't now use. I want to keep the account, but I could remove her from it. If I do so, can the financial link be broken, by asking Experian, Equifax and Noddle to remove it. This account is the only link?

Its hard to know what to do, as despite my defaults, my experian score is higher than hers. Hers is now 933 (Good - 878 Fair when turned down) and Mine is 978 (excellent). I can see that the Finance company have done a associate search on my experian record. I know that the scores don't mean anything, espcially when my Equifax score is 306 (very poor) and hers is 383 (poor). Interestingly, since adding her new credit card £2800 limit, her equifax score went down by 10 and experian went up by 45. How is anyone supposed to know what to do?

Anyway, bottom line we have to replace her car. We can't get new,(well we could but we don't want to use her ISA) so it will have to be second hand. We can buy it outright, but that doesn't help her credit score, we are looking to buy for £8000, so what proportion should be loan and who will lend it to her? She banks with Nationwide, Lloyds and HSBC. Her Job salary goes into Lloyds and her own business is with HSBC. And finally, should I and can I break the financial link between us?

Thanks for any help in advance. R

Tixy

With regards to the financial association - if the joint account is closed, or if the bank agree to take her name off the joint account, then you will be able to file a notice of disassociation with each of the 3 agencies. Certainly that won't be helping her applications.

In terms of the other issues, I imagine its no single item causing a decline, but more likely a combination of all of them. Short credit history and short time on the e/r are only things that can be improved slowly.

After the financial disassociation has been processed I would then suggest she applies to her main bank for a small short term loan. I'd go for lloyds initially if they receive her salary.
She probably won't get a very competitive APR so keeping the loan small and short will minimise the cost to her.

Which bank was the debit card cloning issue with? who entered the cifas marker?

RGJC

Thanks for the reply.

The clone was her Lloyds debit card. The Cifas was entered by Huchinson 3G UK a mobile company. Its marked as Victim of Impersonation (02).

R

Thrugelmir

Lack of electoral history may well be an issue. More so as the amount of credit applied for gets higher.

jonesMUFCforever

OP You state that your wife is only British since 2011 - when exactly i 2011 - over 3 years or not? This could be a reason for the decline.

Having said that having £20k in a bank account ,wanting a loan is crazy but what do I know?

barbarawright

I want an ISA which pays higher interest than you would have to pay for a loan

RGJC

Thrugelmir, Thanks, I was thinking that might be the case.
JonesMUFCForever, she became British in November 2011, so yes its under 3 years. Don't think this should be the case, but who knows. In the early naughties, they were throwing money at you. Now its ridiculous the other way. BTW, unless you borrow money and pay it back, you will never get a good credit history for future commitments, and yes we save responsibly because we have children and need to plan.
I wish so too Barbara, but the reality is 2.5 - 3% for mini cash Isa. Its a shame, as the car loan was at 3.2% which was ideal.

vassa

RGJC wrote: »

Thrugelmir, Thanks, I was thinking that might be the case.
JonesMUFCForever, she became British in November 2011, so yes its under 3 years. Don't think this should be the case, but who knows. In the early naughties, they were throwing money at you. Now its ridiculous the other way. BTW, unless you borrow money and pay it back, you will never get a good credit history for future commitments, and yes we save responsibly because we have children and need to plan.
I wish so too Barbara, but the reality is 2.5 - 3% for mini cash Isa. Its a shame, as the car loan was at 3.2% which was ideal.

You don't need any credit whatsoever. If you buy stuff which you can already afford by taking out a loan, and pay more than the value of the item...well, that's just a bit mind boggling.

Why does she need an £8k car? You'd pick something well smart up for the £5k you were gonna put in, and no need to involve a bank.

RGJC

Well surely, that's her/our choice. Different people, different lives. Besides, buying outright will do nothing to improve her credit worthiness. The car she wants costs £15k new, 8k will get her a 2 or 3 year old car. There are none of this car on the market at 5k as its too new design. She wants what she wants, works very hard has two jobs and is entitled to have what she works hard for! R

vassa

RGJC wrote: »

Well surely, that's her/our choice. Different people, different lives. Besides, buying outright will do nothing to improve her credit worthiness. The car she wants costs £15k new, 8k will get her a 2 or 3 year old car. There are none of this car on the market at 5k as its too new design. She wants what she wants, works very hard has two jobs and is entitled to have what she works hard for! R

She works hard for? How do you work hard for a loan? Why does she need to improve credit worthiness when you don't need credit?

Just putting it out there, you're entitled to spend your life paying off debt if you so choose.

RGJC

vassa wrote: »

Why does she need to improve credit worthiness when you don't need credit?

You know what, I wrote a long clever sarcastic reply, but I am not going to even bother.