Sainsburys - has anyone got the advertised rate?

ReadingTim

51% will get the advertised rate - the remaining 49% will get a higher rate, either because their credit history suggests they're a higher risk of not repaying; or because their credit history suggests they're a dead cert for repaying in full, therefore, as a profit making organisation, why wouldn't you want to maximise your profit on this certainty?

The OP falls into this 2nd category, and makes the general mistake (as we all do) that for example, repaying a credit card bill in full every month makes them a good customer - WRONG - it makes you a bad customer as the credit card company is lending them money interest free for several weeks and incurring other admin charges for no profit whatsoever.

uncreative

ReadingTim wrote: »

The OP falls into this 2nd category, and makes the general mistake (as we all do) that for example, repaying a credit card bill in full every month makes them a good customer - WRONG - it makes you a bad customer as the credit card company is lending them money interest free for several weeks and incurring other admin charges for no profit whatsoever.

Thats not true is it? Every time you use a credit card the CC company gets about 2.5%(VISA) to 4%(AMEX) of the total spend as a commission. Thats why CC companies can offer cashback and other perks. They dont solely rely on the receipt of interest on overdue balances. Certainly that interest is more profitable but it also costs more as they have to fund it longer term.

Its a mistake to think that someone that pays off ther balance in full is not making the CC company money. Any repeat customer is a good customer.

jeppy

Please to say that I was offered 3.6% by Halifax

JJG

andyfromotley wrote: »

4. Once they reach the 51% It makes no sense whatsoever to lend out even £1 of the remaining 49% at the headline rate or anything even close to it. It is this 49% that makes them the money. I suspect that even if Martin Lewis applied he wouldn't get the headline rate in this scenario. Given the amount it costs to tun the organisation, advertise, borrow the money in the first place, account for bad debt etc its going to pretty difficult to turn a decent profit lending on 3.4%

Hence why we have a stream of these posts about not qualifying for the headline rate. It may be nothing whatsoever to do with your credit history, just simply a question of bad timing.

(i could be completely off the mark with this. I have nothing to back it up with, its simply my theory.)

This makes no sense. That's not how percentages work. If they gave everyone who first applied the headline rate then that would be 100% who got the headline rate. For everyone who doesn't get the headline rate, they have to give 1.04 people the headline rate.

It would be bad business to give say the first 100,000 people the headline rate and then the following 96,135 people the non-headline rate as they would not be factoring in the risk of non-repayment and good/bad credit risks.

[Deleted User]

51% of those offered a loan will get the headline rate NOT 51% of those who apply for a loan

catwoman73

woodbine wrote: »

51% of those offered a loan will get the headline rate NOT 51% of those who apply for a loan

OK - so it could be that half of people are declined and then just over half of those will get the best rate. So only the top 25% or so or credit ratings.

I've tried the acceptance checker and it says they can't verify my details so can't say and have to contact them - maybe this could be it but I'm on all the electoral roles etc.

Anyway, thanks for the replies - I'm not particularly bothered about not being accepted by Sainsburys, as I've got a similarly priced product from Santander.

I'm just curious what was so bad about my credit status in their eyes to be offered a rate nearly 3x the headline one. I do wonder what would have happened if I had gone back to Sainsburys on their price promise - would they have then beaten Santander?

I couldn't be bothered to do this for what would have been a tiny amount of money (less than £10 over the term of the loan I think) and I didn't see why I should beg Sainsburys for my business that they clearly didn't want initially unless they thought they were going to make a lot more money out of.

marathonic

20aday wrote: »

For those who've received a higher APR than initially quoted what did the tool (here: https://www.sainsburysbank.co.uk/borrowing/bor_borrowing_zone.shtml?source=NETGLOBNAVISOURC0001#tab-will-i-be-accepted ) say if you used it out of interest?

I'm not looking to apply at the moment but it's come back with a figure of 3.6% here (and I appreciate a hard search would possibly alter said rate).

I got 'Eligibility Score: 40%'.

The APR quoted by the soft search is still the representative APR and not tailored towards you.

[Deleted User]

catwoman73 wrote: »

OK - so it could be that half of people are declined and then just over half of those will get the best rate. So only the top 25% or so or credit ratings.

I've tried the acceptance checker and it says they can't verify my details so can't say and have to contact them - maybe this could be it but I'm on all the electoral roles etc.

Anyway, thanks for the replies - I'm not particularly bothered about not being accepted by Sainsburys, as I've got a similarly priced product from Santander.

I'm just curious what was so bad about my credit status in their eyes to be offered a rate nearly 3x the headline one. I do wonder what would have happened if I had gone back to Sainsburys on their price promise - would they have then beaten Santander?

I couldn't be bothered to do this for what would have been a tiny amount of money (less than £10 over the term of the loan I think) and I didn't see why I should beg Sainsburys for my business that they clearly didn't want initially unless they thought they were going to make a lot more money out of.

so you were accepted for a loan with santander and then applied to sainsburys? that explains why they offered you 9%

boo_star

woodbine wrote: »

so you were accepted for a loan with santander and then applied to sainsburys? that explains why they offered you 9%

It was the other way around.

gazman100

ReadingTim wrote: »

51% will get the advertised rate - the remaining 49% will get a higher rate, either because their credit history suggests they're a higher risk of not repaying; or because their credit history suggests they're a dead cert for repaying in full, therefore, as a profit making organisation, why wouldn't you want to maximise your profit on this certainty?

The OP falls into this 2nd category, and makes the general mistake (as we all do) that for example, repaying a credit card bill in full every month makes them a good customer - WRONG - it makes you a bad customer as the credit card company is lending them money interest free for several weeks and incurring other admin charges for no profit whatsoever.

I understand what you're saying, but can't help think they'd be different criteria for loans and credit cards. Those that pay off cards every month would make 'poor' credit cards customer from a profit/interest point of view but I'd have thought look a safe bet for a loan. But that said I'm not a bank!:)