Fair Credit. Can i get a loan?

kayley6688

Hi Everyone. First time posting here. Iv been waiting 4 months for my credit profile to update so that i could get a new car. My car has now completely died and am desperate for a new one. Iv managed to get my Experian score from 600 (poor) to 765 (fair). I dont earn much to be honest (£13525 a year and 25 years old) but i still live with my parents although iv had a bit of a patchy electoral roll for the past 5 years. I will list the information:

I am now on the Electoral Roll at my current address,( updated today on experian)
2012 - 2013 was missing from when i moved in with my partner.
I have never missed a payment on anything.
I Have a woolworths account with a credit limit of £1300 using £430
Argos account credit limit £580 - using £140
Overdraft £1050 - currently in around £600
Loan with Lloyds for the house me and my partner rented £1900 - balance left £1600

I am currently using 49% of my credit, the lady at Experian told me this was good and lenders wont go above 63%.

My thought was if i get finance for a car i will be paying around £130, I already pay £79 to the loan and £50 a month to woolworth £30 to Argos.

I have been on the Nationwide Soft search. Yesterday they quoted me 8.4% of 3 years for £7.5k loan.
Today it is 9.9% which i still dont mind paying and is less than what i would be paying with finance.

My only problem is i dont really want to apply if im going to get immediatly rejected. Is 9.9% an acceptable rate? am i asking for to much money considering i only earn £13525 a year. I have been at my job full time for nearly 7 years. Zopa have also quoted me 7.5% with a £300 fee. I have also done a soft search on Money supermarket that is giving me a 90% chance for everyday loans which the APR is 39.9% or 40% for Zopa.

Anyone in the same kind of situation that has been accepted for a loan?

imoneyop

kayley6688 wrote: »

Iv managed to get my Experian score from 600 (poor) to 765 (fair).

Well done! Pity it is an irrelevant number just sold by the CRAs to make people like you feel good.

kayley6688 wrote: »

I am currently using 49% of my credit, the lady at Experian told me this was good and lenders wont go above 63%.

Unfortunately, the lady at Experian isn't the one who will be lending you money, so you can take everything she says with a pinch of salt

kayley6688 wrote: »

My only problem is i dont really want to apply if im going to get immediatly rejected. Is 9.9% an acceptable rate? am i asking for to much money considering i only earn £13525 a year.

You have credit of about 4.5k at the moment, so on your salary you are unlikely to get a 7.5k loan.

Look for a cheaper car would be my advice.

DCFC79

First of all welcome to mse.

Secondly you dont have a credit score as the lenders dont even see it.

Thirdly dont listen to what the lady @ Experian said as she nor Experian are lenders.

I notice you earn £13525 a year and want a loan of £7.5k loan, I don't think its likely as its more than half of your salary.

Is 9.9% an acceptable rate ? It is if thats the best you can get, its not too bad, better than 30/40%. If you could get it at the rate of 9.9% then you haven't done bad.

Going by what I know of Zopa they are strict with who they lend to.

kayley6688

Hi Thankyou both. The car i want is £4000. Do you think i would have a chance at finance? car loans4 u have offered me 12.9% which is just a car loan. I havent actually gone through a finance company as of yet.

imoneyop

As a rule of thumb, lenders go for total credit of about 50% of salary as a maximum - so you'd probably be hard pushed to get more than a couple of grand.

Car finance is usually a bit more flexible, as they have the car as security that they can take back if you default. You also need to check if the 12.9% car loans4 u have offered is a flat rate or an APR - if it is a flat rate then the APR will actually be around double that.

DCFC79

kayley6688 wrote: »

Hi Thankyou both. The car i want is £4000. Do you think i would have a chance at finance? car loans4 u have offered me 12.9% which is just a car loan. I havent actually gone through a finance company as of yet.

Have you read any reviews of them ?

As your living at home have you not been saving ?

CLAPTON

living in your overdraft appears to show you spend more than you earn; so how will you find the money to pay an additional loan?

poppasmurf_bewdley

Sorry to dampen your enthusiasm but you don't stand any chance of doing what you are proposing. The maximum loan you will get - if you have a perfect credit standing - is 50% of your take home pay. So take off the percentage you already have and subtract that from the 50% will leave you with the percentage you could borrow - if you have that perfect credit standing.

To even think about buying a car at a cost of half your annual salary is pure madness.

It's time to start rethinking your requirements. A car for £1k - £1.5k should be your aim. There are plenty of good ones out there at that price. I know because I had one up to a couple of years ago - a 2001 Mondeo estate diesel.

kayley6688

CLAPTON wrote: »

living in your overdraft appears to show you spend more than you earn; so how will you find the money to pay an additional loan?

I was going to pay the overdraft off with the loan. along with woolworths, argos and my bank loan then buy the car so everything is in to one payment over 3 years. I dont really have many other bills at the moment other than giving me my mother some and phone bill. I am currently still paying insurance on my car even tho i am not driving it.

kayley6688

DCFC79 wrote: »

Have you read any reviews of them ?

As your living at home have you not been saving ?

Hi i havent been able to save, all my money went on trying to fix my car up for MOT only to be told it needed at least another £700 worth of work doing to it, i didnt believe them so took it somewhere else and they quoted me £800. it was a 14 year old car.

CLAPTON

kayley6688 wrote: »

I was going to pay the overdraft off with the loan. along with woolworths, argos and my bank loan then buy the car so everything is in to one payment over 3 years. I dont really have many other bills at the moment other than giving me my mother some and phone bill. I am currently still paying insurance on my car even tho i am not driving it.

That isn't the way a potential lender will see it as you don't have to pay off the OD or the other debts ... they will see 7.5K + 4K = 11.5k which is far too high in relation to your income.

could you do without the car for a while and clear the debts?