Will Parents Bad Credit Effect Student Bank Account Application

Rikki

I wouldn't have thought so.

He just need to have a proven track record with the bank. He has to build up his own credit rating.

He will have his maintenece loan/grant going into this account so they will see the account active. The banks know this money is paid in three payments, his wages will be paid in too. I'm sure this is when the overdraft facility will be inplace.

My son has changed banks for his student account and he is an unknown to them so he had to have £300 in his account before he could have a debit card and apply for a credit card. Each bank is different.

dreamon_3

He has the account in place, it's just the overdraft which they won't allow because of the credit check which has been declined and they have advised him that they 'presume' because of our history ? They said that they would be more than willing to give him an overdraft even without any activity on account as that is the terms of their new student account however you have to pass the credit check ? I suppose he will have to get a credit report to see what is wrong ?

Rikki

Is he registered to vote?

dreamon_3

Yes on he is on the electrol roll


Ive found this statement on the Experian site (don't know if I can post a link on this site?) ..
http://www.experian.co.uk/consumer/index.html (apologies in advance if this is wrong )


It quotes this :

Will our debts affect our student son?



Dear Jill,University challenge
I am concerned for my 17-year-old son who currently lives here but intends to apply to universities soon. Will my credit difficulties or those of my husband affect his prospects when he applies for financial support during his studies?
Bernadette, York

Dear Bernadette,
Of course you are right to be concerned. Although the Student Loans Company does not carry out credit checks when lending to students, other lenders do. So if your son applied for credit at the moment, they could take information about you and your husband into account as well.

The good news is that this is changing. From November 2004 your son will only be linked to you if you share a financial connection, such as a joint credit account, a joint court judgment or a joint credit application. Unless your son applies for credit before November, yours and your husband's details probably won't affect him at all. Let us know if you need the link breaking before then.

I might get him to take this along to the bank and see if they will review the situation ?

moonpixiewitch

Hi
So sorry to hear of your predicament , but I think you may have assumed the bank automatically give you the overdraft when you open the account , I don't think (please correct me if I am wrong) it works like that? I think you need to have the money going in and out for a bit before they will lend you money.
I assume that your son does not have enough of a credit rating yet to pass the credit checks the banks carry out. Does he have a bank account and debit card already(elsewhere)?
Also I recently took up a 30 day free trial with experian through pigsback , and to my surprise an old expartner was listed as an associate (financially speaking) , as he still owes 1000's to creditors it was affecting my credit rating (not that I have applied for credit since going bankrupt). Experian have changed my records within 24hrs of me asking . Please get your son to register with them to get access to his credit reports , so you can check there is nothing in there that should not be. It is these credit reference agencies you need to ask to change the records before you go to the bank again.
GarlikPatrol also does free credit reports but they are not as widely used by banks doing credit searches , but it may well be worth checking all records held on your son with all credit reference agencies so you can get any mistakes corrected.
In my limited experience the banks are not interested in why the credit check "fails" , it just does as far as they are concerned.
Too many searches will also I understand affect the credit score and hence the rating as well, perversly so will not enough activity on the credit searching front. So it is very hard to strike the right balance , but if he has had two searches for overdraft accounts very recently I would advise against going for any more for a few months.
Just a thought , has your son checked all the possible sources of bursaries , grants , disability payments etc , this months moneysaver email has some info on where to start looking , as do the student boards on here.
http://www.egas-online.org.uk/fwa/index.html
http://www.scholarship-search.org.uk/
My daughters uni pay a grant of £1000 in 3 instalments if your attendance is over85%.
Is your son entitled to any benefits of any kind (this will depend on where he lives during term time)? Also there is a great thread somewhere in this area about student hardship funding (can't remember what it is called now )
apparently all uni's have upto £3500 available for each "needy" student , I believe they have to prove their need to qualify , but worth looking in to .
Lastly I would say , that maybe starting out uni life with the intention of living off the overdraft was maybe not the route I would have taken . My daughter will have to find a job if she is to survive at uni , as bankrupts her step dad and I can't get credit and do not earn enough to help very much .
She will not get a full grant and has to have some loan as well , but because she has seen what my disregard for money did to me , she knows the value of money far better than I did at her age and she is determined not to use any overdraft unless she absolutely can not find another way.:rolleyes: She realises it is not her money , something that took far too long to dawn on me !
I hope I have been of some help ,and if your son really wants to go to uni he will find a way with or without an overdraft.

bwgames

That is strange.

Have you tried obtaining his credit reports to see if there is anything wrong with them?

There is no reason for your credit to move onto your son's report, unless you are jointly linked, which I can't see being the case.

I got the full £1200 NW student overdraft with no problems, despite having no credit at all.. I just thought that was standard

However, in this case, I would recommend your son applies to the Access to Learning fund that universitys offer. They are given government money to distribute to people who need it due to financial circumstances. It is usually NON-repayable, and you can apply each year. This is actually designed for these sort of circumstances. http://www.aimhigher.ac.uk/student_finance/sources_of_help/access_to_learning_funds.cfm

If your son tells them, that due to NW refusing him, blahblah, he is thinking of having to give up uni due to it, etc etc, then they will take that into account.

They can give him up to £3500, but this is very much dependent on in/outcome. It may be as one lump sum (nice, but not recommended, unless your son is good at budgeting ), or throughout the year, which is handy.

Also see this MSE thread about Access to Learning: http://forums.moneysavingexpert.com/showthread.html?t=179491

moonpixiewitch

bwgames wrote: »

I got the full £1200 NW student overdraft with no problems, despite having no credit at all.. I just thought that was standard

please can you tell me - did you apply before or after the student loan money paid in?

bwgames wrote: »

Also see this MSE thread about Access to Learning: http://forums.moneysavingexpert.com/showthread.html?t=179491

thats the one I was trying to remember :rolleyes:, thanks for posting that:T

seaweasel

Was just thinking that, they probably won't give him an overdraft until his first loan or other payments go in.

Halifax and Nat West have nothing to do with each other. Halifax is in the same group as Bank of Scotland (HBOS), Nat West is owned by the Royal Bank of Scotland (RBS Group).

dreamon_3

seaweasel wrote: »

Was just thinking that, they probably won't give him an overdraft until his first loan or other payments go in.

Halifax and Nat West have nothing to do with each other. Halifax is in the same group as Bank of Scotland (HBOS), Nat West is owned by the Royal Bank of Scotland (RBS Group).

Thanks


He has contacted them again today, they said they would provide an overdraft even without any activity on account, it has been refused because of credit check, computer said NO and cannot give anymore information other than it has been declined. He has friends that have opened up new student accounts with Nat West and other banks and they have received their overdraft with no problems. Have applied today for credit reference to see what is going on.

And people say its easy to credit ?

dreamon_3

Update

OK now I'm confused

Received credit report from Experian and it's clear apart from one search by Halifax (they refused account from the start) and FOUR searches by Nat West ?? So it would appear that the searches they did refused the application :rolleyes:

Phoned Nat West told them about report, they said sorry computer said 'no we cannot bypass the system ? Said they would revise situation in 4 months time and in the meantime pay in student loan etc etc and let us see how good you are blah blah blah

Isn't this all a bit looney ? Anyone with any ideas ?

Thanks