refused extra borrowing on mortgage

PeacefulWaters

gycraig wrote: »

Why would they lend you 4 grand over 5 years for the tiny tiny bit of interest they would get on it ?

Because banks tend to do lending. It's the business they're in.

Gaz83

PeacefulWaters wrote: »

Because banks tend to do lending. It's the business they're in.

It's a reasonable point, though. If the OP's interest late on their mortgage is low, then a loan of £4k might only generate a couple of hundred pounds of interest - perhaps it'd cost more than that to set up and administrate the loan to begin with.

PeacefulWaters

Gaz83 wrote: »

It's a reasonable point, though. If the OP's interest late on their mortgage is low, then a loan of £4k might only generate a couple of hundred pounds of interest - perhaps it'd cost more than that to set up and administrate the loan to begin with.

They have a minimum loan amount to drive value.

I'd suggest it's almost certain that they have arrangement fees too.

Thrugelmir

PeacefulWaters wrote: »

Because banks tend to do lending. It's the business they're in.

Of which there's different kinds.

lee111s

Never had a problem lending with First Direct.

I have a personal loan at 3.9% with them and a credit card with 17 months interest free on purchases. Both approved within minutes, no questions asked.

the_original_mabel

Thanks everyone for your replies. Maybe it is just that it was too low an amount for them to be bothered with
Tbh i was too embarassed to ask any questions. They just said 'based on the figures you have given us today, we are unable to lend' i just assumed they thought we couldn't afford it.

Then when they offered to assess us for the personal loan at 13% i was a bit annoyed. I don't think they made the rate higher for us especially; i think the 3% rate is only available on borrowing of 7k or more. I didn't persue that.

We have applied for the 20 month interest free credit card from clydesdale online. We had the agreement in principle reply back instantly subject to their extra checks being ok
We will easily clear the balance as we have an endowment policy maturing aug 2016.
I think i will write to first direct asking for more detail on the refusal. hopefully they will then give the reason.

All your replies have helped me get over the sense of rejection though so thanks to all of you

Gaz83

the_original_mabel wrote: »

I think i will write to first direct asking for more detail on the refusal. hopefully they will then give the reason.

Probably not. Lenders don't make public what their own criteria for acceptance / rejection are.