Yorkshire bank loan - watch out

Macblack

Based on the rates shown on here, I applied for a personal loan through Yorkshire Bank.

Amount £24,000
Period 4 Years

The rate I was offered was 4.9% with a monthly payment of £574.

I have a really good credit rating so I wasn't surprised to see that I had been accepted for the loan.

However on checking the confirmation details the loan now had an APR of 24.9% and a monthly repayment of £794, that's almost £220 more a month!

I rang up and complained and their answer was that because I didn't have an account with them they had no history to go from!

I find this ridiculous and to be honest mis-leading, yes they say that APR can go up on application and I thought this might be by a couple of % based on application status, but not 20%!!!

Won't be going there again.

Watch out if you think you are thinking of getting a loan with them..

James_B.

At least 51% of successful applicants will get the advertised rate, and these will tend to be the people with the best verifiable credit record Being a customer of the bank may well increase the chance that you are part of the 21%.

There's nothing unusual about those who do not qualify being offered a higher rate which is reflective of their lower likelihood (statistically) of keeping to the agreed payments.

Most banks will work in the same way, so you should probably not feel that this one is doing anything out of the ordinary.

Macblack

51% getting the advertised rate, surely this is not good??

After posting the message below, I went onto Experian to check my credit score and I scored 969 (Excellent).

The only thing that wasn't green was an indicator suggesting higher unsecured lending. Which is the few credit cards I have and the purpose for the loan.

I think what I don't get is that Yorkshire Bank have for whatever reason deemed me a risk. If this is mainly due to not being a customer then they should not advertise this cheap rate without stating the conditions to it.

If its because of my credit score, If I'm risk at 4.9% then I'm an even greater risk at 24.9%!!!! So why offer me the loan at all?

I think its about time lenders should provide detail reasons why they say no or offer an increased rate.

Yes, Its my spending that got me to where I am today and It's my responsibility but I think in this case It would have been far better for Yorkshire to say "No" and provide the reason.

Apples2

Macblack wrote: »

I think its about time lenders should provide detail reasons why they say no or offer an increased rate.

that will never happen. The best you will get is a generic reason.

If you knew exactly what is required to obtain the advertised rate, 100% of applications would fit the criteria. It's like doing an exam with the answer paper in front of you.

Your credit score is worthless, it doesn't even know if you are employed or salary you earn.

It can be reasonably assumed that if you are already in debt (credit cards) then you will not fit the perfect risk. If you can't clear your current debts, there is risk you might encounter problems satisfying even more debt?

Blame Europe for the 51% issue, it used to be higher until they waded in.

Horseunderwater

You're borrowing more money to pay off debts & that IMHO is most likely why.
Go to the debt fre wannabe board & ask them for help with your budgeting & visit either stepchange or national debt line - both of whom can help.

Macblack

Horseunderwater wrote: »

You're borrowing more money to pay off debts & that IMHO is most likely why.
Go to the debt fre wannabe board & ask them for help with your budgeting & visit either stepchange or national debt line - both of whom can help.

I wondered if Yorkshire (indeed any lender) see it this way when you tell them in the application that the loan is to consolidate other debts?

Think I will go back to my own bank and see if they can improve their rate, based on this experience I've probably got more chance of a decent one.

123sky123

Hey guys! Any tips on how i can get out of this very bad situation? Im 21 and have ran out on ideas as can't rely on my family etc...ok so i took out a loan with tsb £11000,over 5 years,and just looked its around 20% apr...i took out a loan to invest into a buisness and advertising,then to realise the company was a scam and as it was an international transfer,the bank said they cant do anything about getting the money back,the fraud team was useless after a few attempts,rang trading standards and they are trying their best but doesnt look like anything will come of it,working all hours just to get by,also giving up alot of things! After getting into this debt having to loan 5k of a freind and selling my car to get by and have some money to get another car on finance as other wise i couldnt get to where i need to work etc,really starting to worry! Any help? Thanks

bargainbetty

123sky123 wrote: »

Hey guys! Any tips on how i can get out of this very bad situation? Im 21 and have ran out on ideas as can't rely on my family etc...ok so i took out a loan with tsb £11000,over 5 years,and just looked its around 20% apr...i took out a loan to invest into a buisness and advertising,then to realise the company was a scam and as it was an international transfer,the bank said they cant do anything about getting the money back,the fraud team was useless after a few attempts,rang trading standards and they are trying their best but doesnt look like anything will come of it,working all hours just to get by,also giving up alot of things! After getting into this debt having to loan 5k of a freind and selling my car to get by and have some money to get another car on finance as other wise i couldnt get to where i need to work etc,really starting to worry! Any help? Thanks

You should probably start your own thread, as this is on a different subject.

If you have willing sent your money overseas, your only option is to report the recipient to the police in the jurisdiction he/she lives, and ask that they follow whatever procedure necessary to charge/prosecute the fraudster.

Sadly, even that might be no help in getting your money back. Not every country has Proceeds of Crime Act to reclaim stolen property/money or a criminal compensation service.

The likelihood is that the money is gone. Very expensive life lesson, I'm so sorry.

Perhaps speak to one of the debt management companies about sorting out the payments over a longer period to allow you to live reasonably. Use Stepchange or Payplan - don't fall for the promises of any fee-charging companies. They will take some of your money, and can't do anything the charities can.

Good luck

Pixie5740

Macblack wrote: »

51% getting the advertised rate, surely this is not good??

That's the legal requirement for the advertised typical APR.

Macblack wrote: »

After posting the message below, I went onto Experian to check my credit score and I scored 969 (Excellent).

Please tell me you're not wasting £14.99 a month getting an arbitrary credit score from a company that doesn't lend money. If you are then cancel this service and use the money to put towards your debts. Every little helps.

Macblack wrote: »

The only thing that wasn't green was an indicator suggesting higher unsecured lending. Which is the few credit cards I have and the purpose for the loan.

I think what I don't get is that Yorkshire Bank have for whatever reason deemed me a risk. If this is mainly due to not being a customer then they should not advertise this cheap rate without stating the conditions to it.

It's probably mainly due to your existing unsecured debt. Due to this you are a higher risk to lenders. Who is to say that if you consolidate this debt with a loan you won't just rack up your credit card debts? Many do because they haven't tackled the root cause of the debt.

Macblack wrote: »

If its because of my credit score, If I'm risk at 4.9% then I'm an even greater risk at 24.9%!!!! So why offer me the loan at all?

Greater risk customers are offered higher interest rates, it's not rocket science.

Macblack wrote: »

I think its about time lenders should provide detail reasons why they say no or offer an increased rate.

If people knew the exact criteria that lenders used they would just fudge their applications to meet the criteria.

Macblack wrote: »

Yes, Its my spending that got me to where I am today and It's my responsibility but I think in this case It would have been far better for Yorkshire to say "No" and provide the reason.

Get yourself over to the Debt Free Wannabe board for support and advice. It's possible to clear your debts without taking on more debt. Good luck.

Gaz83

Macblack wrote: »

I think its about time lenders should provide detail reasons why they say no or offer an increased rate.

They'll never do this. Simply because people would then deliberately (and often fraudulently) tailor their applications to make sure they weren't saying anything that may compromise their chances, regardless of how truthful those things would be. It's for the same reason they don't publish the criteria that the 51% will require.

Macblack

Well, I went to my own bank and despite the rate being slightly higher (6.9%), it was accepted.

No, I'm not paying for the £14.99 for the credit score company, I signed up for a free trial and will cancel this now.

I suppose the question of the lender telling you why you weren't accepted is just naivety on my part. I just assumed they would look at your actual spending history through the likes of Experian and not qualify the decision based on what was put on the application form.

I have no intention of getting into more debt that's why is cutting up time...