Paypal 0% Credit - Lending Criteria?

fallen121

My daughter's Nexus tablet has just died after 2 years of use. As we had a very modest Christmas and she uses her tablet every day, I decided to purchase a very basic iPad mini 2 for her birthday at the end of January as I would rather do that than spend money buying a load of crap she will never use. Yes, I am aware that Kindle Fire is cheaper, but she uses a lot of Google Apps you can't get on Kindle.

Whilst going through checkout at the Apple store (via Quidco) I was offered Paypal 0% credit over 6 months or 12 months and decided to give it a go. I sell a lot on eBay and reckoned I could use the money from that to put towards the monthly payment, failing which the balance would just come off my current a/c.

Questions asked were my salary, partner's salary, amount of mortgage and monthly expenses. Answered questions honestly. We do still have a fair amount of money left at the end of each month which we use to buy groceries and petrol with cash, pay more towards mortgage and credit cards and so on. We don't go to the pub or cinema and the only thing we have to pay out for on a regular basis is £6 a week for my daughter's dance class. So reckoned we had more than enough to cover a £19 monthly payment.

Guess what? Turned down flat. Happens sometimes, I suppose. But I was approved for a new 0% Nationwide credit card at the beginning of 2014 and have brought the cards DOWN and have a couple with nil balances one of which I use only when I go away with my company and have to pay hotel bills, which I then claim back on expenses.

Noddle rating is 4/5. Plus paid home and car insurance in full rather than paying on installments. We've had numerous offers of credit card limit increases as we've paid them down and are drowning in 0% balance transfer offers which we don't need as all our cards are on 0% now. Haven't had an O/D at the TSB in over 9 months. Apart from the price comparison quotes in November for the car and home insurance, can't think that there would have been many searches. No CCJs nothing untoward on credit record, green across the board for payments.

Only conclusion is that lending criteria must be really harsh. Our postcode area isn't the poshest in the world I suppose, but does that really make a difference? Who do Paypal use to make their lending decisions, does anybody know?

Not a great start to 2015 but as we weren't planning a huge wodge of borrowing anyhow it doesn't matter either way.

Can anyone shed any light?

jonesMUFCforever

You just did not meet their criteria - nothing more nothing less.
You could apply for a 0% purchase card or spend the money on an existing card and then transfer to a 0% BALANCE TRANSFER CARD.

fallen121

Had £40 in Paypal already and the rest has gone onto a 0% purchase card.

Hopefully the card company will recognise the Paypal transaction as a legit purchase. Read all the T&Cs and it says internet shopping is ok for the 0% but whenever I do something like this it always screws up somehow or isn't eligible for the offer or something.

If the lending criteria are so tight that only those with stacks of cash and no borrowing will get approved, it seems a bit pointless as I don't suppose people with cash to splash are really bothered about spreading a £230 payment over a year.

Apples2

They add up the credit card limits, not the balances.

The limits of all those cards is your exposure to debt. You could ramp them all up to their limits in a few hours if you went crazy so it is factored into their lending criteria.

tell_it_how_it_is

Clearly something has been flagged up from the information given and known, but don't get hung up over it.

tonyh66

you do know you can't use google apps from the playstore on an apple product? you have to get all the apps from the Apple app store.

DCFC79

If as you say "we have a fair amount of money left at the end of each month" why not save that amount of money for so many months and use that money for the ipad.

fallen121

The reason I don't save up over a few months to get the iPad is that I want it for my daughter's birthday so she has something to open at the end of January. She won't be getting anything else.

As we use some of the spare money for groceries/petrol I can't really expect her to wait 2 or 3 months for her birthday present whilst we save up. If I bought the iPad now with the cash I have I could get into the situation of having to put groceries on a card at the end of the month when we run out of cash and that's not a habit I want to go back to - that's what got us into the mess we're in at the moment.

I've bought the iPad with part Paypal balance part 0% card and setup a monthly S/O to cover 1/10 of what is outstanding on the card. Didn't do it over 12 as the 0% runs out in December.

As things stand, she's using her mobile phone to message her friends and watch videos so she's not exactly without any method of communication, but the whole reason we got her the Nexus tablet in the first place was that we were concerned at the way she was hunched over peering at a tiny screen. Also when she uses the phone she tends to run the batteries right down. Not a problem right now as it's the holidays but once she goes back to school we need that phone charged so we can stay in contact as we both work and she doesn't always know in advance what her travel arrangements home from school will be (her school is quite far away).

Didn't realise that the "empty" or unused card balances counted towards our debt exposure. Would it be better if we shut some of those down? Loathe to shut down every single one though as I like an "empty" card when my work make me pay for hotels and then claim it back as I can just pay it off before any interest hits and then forget it. I once made the mistake of shoving the hotel bill on a card where we had a 0% BT offer. When the expenses came in I paid it towards the bill but then realised that the money just went towards paying off the 0% BT debt and then the hotel bill just sat there behind the 0% BT accruing interest at 14% something a month. Don't think the card companies can do that anymore but put me off using cards where I had any sort of 0% offer running.

fallen121

We have a Mac at home so have compared Android and Mac for apps and most of what she needs is available in a Mac equivalent. The issue is that the Kindle doesn't support a lot of what Mac and Android do or have their own version which doesn't have the same functionality.

I have a Kindle Fire and my daughter tried to download some of the "typical" apps she uses and we couldn't get them to work on the Kindle. Tried all sorts of hacks and different sites where they tell you how to get around it and ended up wasting a lot of time and getting nowhere.

I am all for money saving but at the end of the day if she doesn't get on with a cheaper Kindle then it is just a £99 brick and she'll go back to using her phone. That's £99 wasted, not £130 saved. She makes a lot of animation videos and stuff like that. She prefers to stick with the apps she knows and is also quite savvy and pointed out that some of the apps she uses for free on Android/Mac are available on Kindle, but you have to pay. I'm not setting her up with an Amazon account with 1-Click linked to my credit card. She doesn't want it and I can't afford it anyhow.

Gaz83

fallen121 wrote: »

As we use some of the spare money for groceries/petrol I can't really expect her to wait 2 or 3 months for her birthday present whilst we save up.

Why not? That's what my parents did when I asked for something that they wanted to get me but couldn't afford.

Also, if she is used to an Android, you could have got an Asus Nexus 7 for a lot cheaper than what you would have paid for a 'very basic' iPad Mini.

And if it's money that's spent on groceries and petrol then it's not really 'spare' money.

Apples2

fallen121 wrote: »

Didn't realise that the "empty" or unused card balances counted towards our debt exposure. Would it be better if we shut some of those down?

Keep a couple for emergencies.
Of course some people use them all the time but clear the balance every month, that is great if you are disciplined enough.

Point 20 in this feature

http://www.moneysavingexpert.com/loans/credit-rating-credit-score

Cancel unused credit and store cards

They can kill your application. Access to too much available credit, even if it isn't used, can be a problem. If you have a range of unused credit cards and lots of available credit, it could be a good idea to cancel some of them. This lowers your available credit and should help.