Zopa loan - apply now or wait?

jocstoke

My husband wishes to apply for a Zopa loan to finance a car purchase. He intends to borrrow approx £4,000 over 3 or 4 years. The only other debt he has is a mortgage on which the repayments are £415 per month, his salary is £24,000.

He has one credit card which has been paid off in full each month since this time last year. However, in February there was a transaction of about £240 on the card which he forgot to pay off in full. The minimum payment for March came out by DD but the remaining balance was only cleared a couple of days ago. The limit on the card is approx £3500.

Is it worth waiting for his credit file to be updated with the fact that the credit card is now clear again, or is it unlikely to make much difference in the scheme of things? The eligibility check on this website gave a 90% chance of acceptance, but don't want that small thing to scupper his chances of acceptance.

[Deleted User]

I doubt it will make much difference, as he made the minimum payment.

However, he will need a good credit history generally for Zopa.

jocstoke

Thanks for this. He has had a good credit history for the last 12 months or so, however prior to this he had several thousand pounds worth of debt over three credit cards (all pretty much maxed out), as well as an overdraft. These were all cleared in full a year ago (using an inheritance) and two cards were cancelled; the third was left open and has just been used for odd things and mostly paid in full (with the exception of the previously mentioned £200 transaction in Feb). Do you think it's worth applying with Zopa at all?

[Deleted User]

Sounds like it may be worth a shot. He has recent high utilisation, but it doesn't sound as if he had any missed payments or defaults. Is he now out of his overdraft?

But consider a back up lender in case you're declined, as you'll want to be accepted the second time around, or the searches will start having a detrimental effects.

jocstoke

He hasn't been in his overdraft for a year, hasn't even approached a zero balance in his current account. Even when he had the credit cards the minimum payments were always met and there were certainly no defaults.

Any recommendations for if Zopa decline? Tempting to go for the next best interest rate but like you say wouldn't want to risk getting declined again.

[Deleted User]

I'm not familiar enough with the lending criteria of other lenders. But sometimes your own bank can be a safer bet, as they can see the management of your current account, if they choose to.

jocstoke

My husband applied following your advice and was accepted by zopa. Thanks for your reassurance, he's naturally a worrier so was very helpful.