First Loan Application Denied

N1Nolan

Evening all,

I recently had my first loan request denied, i'm a 21 year old male with a good credit rating according to experian with a score of 887 out of the 999.

I applied for £6000 over 36 months and the purpose was for a new car. I believe the reason as to why i was denied is because i don't have any long standing credit, just things like insurance and phone contracts, nothing really big in terms of borrowing money.

I have some money that i was going to partly use to pay the remaining price of the car (£7500), was just wondering if there is anything i can do short term to boost my credit rating to make it more appealing to lenders? I have been into my bank (Halifax) and asked about the clarity loan they do with a 3.9% APR, but as soon as i gave them my details the APR changed to 23.9% which is too much in my eyes.

I understand that i'm only young and don't really have any proof of good credit but i have never missed a payment on anything i have for example car insurance, phone bills ect.

My salary is more than enough to be able to repay they monthly installments of a loan at 3.9% and even more, but feel as though i'm being accused of having poor credit before even being given a chance to prove myself which is a shame.

Any suggestions on how i could find a better deal? I obviously understand that saving the full amount of money would be the best idea.

Thanks :beer:

[Deleted User]

Unfortunately, the CRAs don't lend money, so their scoring system is largely irrelevant.

If you have no negatives on your reports, then the reason for the decline will almost certainly be affordability (you don't state your salary) and a lack of credit history. Lenders like to see that you can manage credit before handing out too much. Using a credit card sensibly is the best way of demonstrating this.

Electoral roll, not moving about too much and any financial associates also play a part.

I would use the savings you have to get a car, which is more than enough for a first car. Then once you are more established in terms of credit, and have saved more, look to upgrade.

N1Nolan

Hi there,

My salary is around the 27k mark, i am on the electoral roll and have been at the same address for around 12 years or so (still living at home) I would ask my father to help me and get a loan in hi name but i want to start my own credit.

I already have a car, its just i have had the same for 3 years and i'm just after a upgrade.

Thanks

[Deleted User]

my advice would be to save up then upgrade your car,a loan now might cost £200 a month if you save that amount in 2 years time you will have an interest free loan
meanwhile if you must take out one of the credit building c cards use it regular and pay it off every month

DCFC79

Use the money you have to buy another car and sell your current one.

Your credit score is about as useful as chocolate teapot.