Best reason for a loan in a banks eye?

Tony_Cubitt

Hi, I'm hoping in the very near future to apply successfully for a £12K loan from my bank, whom Ive banked with without any hiccups whatsoever for the last 9 years. I have never once been late on any payment of any kind, nor had payday loans, drew cash out on credit cards, basically you get the picture. However in Sept 2013, I applied for a loan with my bank (Lloyds) to pay for my wedding. Before applying I checked with all 3 of the major credit reference agencies, that my credit rating was tip top, which it was. I did this, because I wanted to make sure I was accepted. At the time, I had a Lloyds credit card with a £5K limit of which I had an interest free balance of around £2000 and a Barclaycard with just an £800 limit fully available. My payment history was spot on. Not wishing to rack up many loan application searches, I was a little silly and only applied to Lloyds as I thought they would see my good banking history and be sure to offer me a £12k loan for my wedding. It turns. Out they did offer me a loan of £12k , but at 17.8% APR over 5 years! Like a fool I accepted. Lloyds said that they would need to pay off the credit card and close the card, to minimise the risk. Fair enough. I've since been paying this for over approx 18 or so months. Lloyds will not let me re-finance the loan at a better rate, instead only offering me a loan for £12K at 28.9%, which I find crazy! Especially given that I really have not ever once put a foot wrong in terms of payments or any kind of blot whatsoever. So I've got a family member to take out a loan and paid everything off. The loan is at 3.7% (£12K). But I'd sleep so much easier, if I can reapply for a loan in my own name (at a decent rate), but am not sure what is the best official reason to give. I don't want to do anything wrong, but I do feel a little harshly treated, as I've done everything I'm told to by the bank, but they will not help me. I also have 0 credit searches in the last 6 months. My salary is about £33K pa.

DevCoder

The answer is you should be truthful, lying on a loan application is a good way to finding a CIFAS marker against you and the loan being called in (if it was offered at all).

Tony_Cubitt

Fair enough. So do I say I'm paying back a family member?

jonesMUFCforever

Tony_Cubitt wrote: »

Fair enough. So do I say I'm paying back a family member?

Yes because that is the reason you want the money.
However if the application goes to an underwriter to have a manual look I would be suspicious of the application.
I'm not saying it would get refused but you may be asked a whole raft of questions before the money turns up in your account.

Tony_Cubitt

All I want is a £12K loan at a decent rate. I play the rules, I pay my bills so I think it's fair I push as hard as possible to get a decent rate loan. Lloyds have really ticked me off to be honest.

jonesMUFCforever

Tony_Cubitt wrote: »

All I want is a £12K loan at a decent rate. I play the rules, I pay my bills so I think it's fair I push as hard as possible to get a decent rate loan. Lloyds have really ticked me off to be honest.

Why not apply with a different lender then?

Tony_Cubitt

So what's to stop me going to A N Other loan company, with a decent rating and just asking for a loan? I don't want to be viewed as a risk and get offered a high APR again? I don't really understand why I'm not being offered this anyway. Even Lloyds have said the same to me!

DCFC79

Your credit rating with the 3 CRA's means nothing. Lloyd's don't have to offer you a loan with a low rate. I used to think if you had a good relationship with the bank you could get a decent rate on a loan but maybe its not the case.

Wait a while and then apply again.

bris

You don't need a reason for an unsecured loan, the bank couldn't care less. The computer will say yes or no, the result is already in the system before you even ask.


The old days where the manager decides are long gone, the person you speak to is just a clerk now, they write things down and imput the data. Your history with them means nothing, it's what your files say that matter.

Herzlos

What makes you think you'll get a better rate now?

I'd be honest with them, you're refinancing a loan to a family member. They'll then decide to give you a loan or not.

Do not lie to them.

Tony_Cubitt

The fact that I've paid all my debt off early with no issues, the fact that I've banked with them for 9 years and have shown myself to be a good customer in terms of payments and I have no blemishes on my credit history.