Furious with HSBC

dearlouise

This afternoon I called HSBC to apply for a 24k loan to consolidate various debt, CC's & overdraft from my divorce & also went back to uni for a year. I'm annoyed I have a decent salary now but still have no money spare due to the debt & it's not getting paid off since it's just paying the interest.

HSBC were positive, went through the screener questions with the first agent, moved onto the 2nd to do a budget calculator, budget was positive, leaving £500 a month left over. Brilliant I thought.

Got referred to an underwriter. Underwriter asked more questions, did an assessment and said my budget is not enough. I said how so, we've worked out income/expenditure... it's fine.

3rd agent (underwriter) decides to say that they include current CC payments in the 'new budget' as so many people ask for consolidation loans and keep the CC's open, then in a few months start spending on them again. Apparently HSBC recently changed their policy on this.

I went bonkers... I explained that if agent 1 had said that current CC payments would be included as if they're not being paid off... so essentially taking on a 24k loan with 24k debt already... I don't need to work at HSBC to know that that would be OVER budget!

I'm annoyed because a) I spent 1hr40min on the phone... and b) this application is now on my file. I wouldn't have gone ahead with it if I had have known their "policy". Have made a formal complaint and am trying to remove the credit application including the 'footprint' it leaves even if they remove the application.

It was more infuriating that the manager (4th person) response was that agent 1 and 2 aren't trained to give specific information such as how the assessment works. Surely that's EXACTLY what they need to know in their role!?!

Not sure how to move forward now... HSBC is my bank. Can you apply for loans with people who aren't your bank?!

IAmWales

Yes, of course you can apply for loans with other lenders.

Any bank will need to fully assess your circumstances to ensure that any lending would be responsible. They've decided you are too high a risk to lend to. Unfortunately it took a while for them to come to that decision, these things happen.

The moment they stop trying to help is when you go "bonkers" at the staff. There is no excuse for your rudeness.

Debt consolidation is rarely a good idea. Have you looked at your income and outgoings to see where you can make changes to pay down your debt more quickly? You should also speak to your current lenders to ask if they can offer a lower interest rate or even a period where the rate is frozen.

Thrugelmir

dearlouise wrote: »

I spent 1hr40min on the phone...

The bank spent it's time too. Banks have overheads to cover.

They gave your application full and proper consideration. The underwriter made a judgemental call mostly likely after reviewing your credit file in more detail. That's what they are paid to do. They'll have a gut feel for the profile of borrower you are.

Caz3121

many lenders will look at the loan as additional borrowing to the existing so you would need a affordability/salary to support £48k of debt (so a big salary!)
Have you looked at 0% credit cards that you may be able to move some of the balance to to be able to concentrate on the higher interest ones?
It may be worth having a look on the Debt Free Wannabe board, consolidation very often does not work.

DCFC79

What if you didnt get the loan you require ?

Cut your spending while your at it is my advice.

lynz68

All lenders will take into account your current level expenditure including your debts they have no guarantee you will pay them off.

You need to look at cutting back on your spending and focus on the debts.

Dobbibill

Being furious is not going to help this.

As suggested, head over to the DFW board - complete a SOA and look at cutting costs/increasing income. (if you want to post the SOA, you can format it for MSE at the bottom - its entirely up to you but definitely a good tool whether you decide to share or not)

There's many stories over the board where consolidation doesn't work - people do refer back to credit cards because life throws a curve ball in and they have disposable income - the result is they land up deeper in debt.

You won't appreciate this right now but HSBC has done you a favour before it spiraled further.

Puddylove

How frustrating for you - I'm sure the bank staff had their rules/reasons though.

Longer term they may actually have done you a favour as consolidation rarely seems to work. I tried it, taking out a £7k loan to consolidate credit cards, etc., but then ended up running up credit card debt again.

Luckily I had my 'lightbulb moment' just before my debts became unmanageable, did Martin's money makeover, budgeted, lived frugally (which actually became fun:rotfl:), and balance transferred my debt between two 0% credit cards until I paid it all off.

Perhaps you could do the same?

Puddylove

Great minds think alike, Dobbibill!

Richey_

Erm it's their money - don't borrow from them!!!
Maybe they are angry with you after spending all this time and wasting their time for a decline. There is no "right" to borrow their money...

zippygeorgeandben

Yes you can get loans from other lenders.