Zopa loan + Sainsbury's

jimw6

Hi All

I'm interested in applying for a Zopa loan. From their site it seems I have passed the pre-application stage (where you enter all your details and they give you a quote - or not). Before I click on 'apply', are there any Noddle experts on here who could advise on a point or two?

If you're accepted (ie after I've hit 'apply'...) it says in the Ts & Cs that they may ask for 'additional information'. In other words, the 'acceptance' isn't 100% at that stage. What kind of info do Zopa lenders normally ask for (this is the stage after they've looked at your credit report) - assuming that my credit rating is good enough to be accepted. It's possible I don't currently show on the electoral roll, I'm not sure from the way the report shows on-screen (it is ambiguous). Are Zopa fussy with additional information requests? (Looks like they may be from commentary elsewhere.)

Also, my debt to loan ratio is quite high - and I understand that Zopa doesn't work like normal lenders as even if the loan is for debt consolidation, they add on the amount to your existing debt when calculating the debt/loan ratio... (?)

Sainsbury's shows as the only alternative one I could 'potentially' get on Noddle/Callcredit; but how accurate is the Noddle 'likelihood of loan acceptance' tool? It gives an estimated 5/10 for the Sainsbury's likelihood of acceptance which doesn't sound too good...

Thanks in advance.

Jim

SeanG79

The truth is no one but Zopa/Sainsbury's can tell you the probability of approval or not and even then only after you apply.

Voters roll is important however some lenders will overlook it if you are a home owner and if you have other credit showing on your credit file at the same address.

Zopa and Sainsbury are "prime" lenders, so generally lend to only stronger applicants.

I know Nationwide offer a soft search (doesn't leave any imprint for other lenders to see) and I think Barclays may offer the same option (they do for credit cards)

Lastly - Noddle are a reference agency and they are pointing you in a direction but have no bearing on whether a lender actually approves you or not.

DevCoder

and I understand that Zopa doesn't work like normal lenders as even if the loan is for debt consolidation, they add on the amount to your existing debt when calculating the debt/loan ratio... (?)

Most lenders add on the debt even if its for consolidation purposes as they cannot force you to actually pay off the debts you are consolidating with the monies.

jimw6

Thanks for that - some interesting details there.

What would be 'easier' lenders to try (ideally ones where the minimum amount of info is required from me - it's all there on my credit file after all), do you know?

In respect of Nationwide, I think what happens is they do a soft search unless you take the application to 'application stage' where a full credit search is needed (in this they are much like Zopa - you can get a quote up to a certain point before that).

Back to Zopa since I am definitely interested in them - does anyone know what the 'additional information' they might seek would be? If I try it and get a decline, does that 1 (just 1) decline on my file influence a new loan application's success that much?

The news (in another thread) that Zopa regard a 'consolidation' loan as one that adds to your existing debt level (not replacing it by the amount of the loan...), is if fully accurate, a put-off as my debt/income ratio is quite near the borders of what is ok (though under it in normal lenders' view...)

Ta

DevCoder

IF you debt/income ratios are so close then you want lenders who want a lot of information from you as you'll have to justify how you will repay the loan.

Giving high level figures will make lenders refuse as the ratios will not be good enough without any sort of reasoning.

What is your current incoming to outgoing and how much are you after?

jimw6

It's ok. My debt level is not up to 'half' of the income level which I understand is where lenders balk. Income level is at a reasonable level also. (Would prefer not to give out personal specifics on a public forum and also don't see the need to get bogged down in such details though thanks for the idea - my maths is ok!)

I don't quite follow when you say I would 'want' to be asked lots of additional info. T-b-h I would prefer a simple application process. They can see my credit file, so just wondered in theory what additional information lenders would be asking for?

Thanks

DevCoder

Because most lenders won't like more than 40% debt to income ratio. So you would need to detail exactly how you are going to pay for this new loan.

I don't know any normal lender who doesn't view consolidation loans as new debt tbh.

If you want a simple questionnaire, then most lenders would be as follows

Is current debt + new loan debt > 50% of annual after tax income?

If yes, reject.

So you need a specialist lender, which will mean providing information to a raft of questions. A credit file does not show in your income / expenditure details. Lenders like to see this.

jimw6

Interesting if all lenders see 'debt consolidation' as adding on to your debt. I only want the same amount in order to pay the existing loans, but over a longer period. So total debt (of mine) will be no higher...

Entirely happy for them to look at my credit file. Just don't want to get bogged down in 'additional questions' or maybe even (?) sending off docs.

What is a 'specialist lender' (as opposed to more mainstream ones...) pls?

DevCoder

One of the subprime lenders, expect to have to pay a significant APR and still have to disclose I/E details.

Whilst you may well pay off the debt with the loan, lenders have been stung in the past by a lot of people who just spend the funds on something else, or repay the debts and then just rack up the debts on the same credit lines while still in the loan period.

Thats why most lenders view consolidation loans as new debt these days.

It's ok for you to say you don't want to be bogged down, but unfortunately you are not the one lending the funds and thus taking the risk, its the other way around.

DCFC79

You wont know which lenders will want additional answers to questions or documents being sent off, its all down to the lenders to be satisfied and if they want the additional information then thats whats required to get the loan.

jimw6

Thanks all. Out of interest, is there a resource for finding out which credit reference agency lenders use, on the web pls?

I notice MSE has a credit card pre-eligibility checker giving the likelihood of acceptance. Is there a useful one for loans around anywhere or do you (just) take your chances? I see that in the cheap loans providers list, there is Hitachi along with Sainsbury's, they rank better than Zopa who I have been looking at. Maybe I should go with them.

Zopa seemed to have the advantage of fast processing (but then I saw the small print about them probably seeking additional information once they have approved you). How long do Hitachi or Sainsbury's take to approve you/get the money to you. The ideal would be to get things through fast.