M&S bank hiking up the APR

ShrewdMover

Hi there,

I just wanted to share an experience I had today which left me feeling like a very dissatisfied customer, I hope the forum doesn’t mind a rant which I will try to keep lighthearted and brief.

Today I applied for a loan with M&S bank. I wanted to top up an existing loan from just under £6k to £15k. They offered a rate of 2.8% and I’d been told I could get this rate over a term of 7 years which was perfect.

I spent 45 minutes going through the application on the phone and when the result of the application came back I had been accepted at the ‘slightly higher’ rate of 5.8%. This was offered with no explanation. I declined to take the loan.

I then went and checked my credit score on Experian. A perfect 999. I called M&S back and asked for an explanation and told them I’d checked my score. What else could it be? I don’t have anything else that could affect their decision, surely. They said they could give me no further information, for my own privacy and security.

Now if I’m doing any kind of financials at home and my numbers come out more than double what I was expecting (5.8 = more than double 2.8 right?) I check my numbers again and again until I understand what happened. I don’t think to myself, well, that’s more than I thought I owed the cleaner, she’s getting a good deal this week.

No, I check it and understand it because it’s important to get it right. And now I want to go and get a loan from another provider but I’m scared because that provider will check my credit score too and we all know how bad that can be. ‘Well sir, we checked your credit score and before we checked it, we’d have been able to offer you a great deal. Unfortunately because we checked it we can’t offer you diddly squat'.

It’s a bit like going to EasyJet because you’ve seen a great deal only to find out the actual price is double so going to BA instead and them telling you that because you found out the price EasyJet would give you they’re going to double their price.

And this credit score business…it’s my data. That’s important, GDPR and all. Not only do the credit agencies have a bit of my data, they have all of my important financial data that is used to determine my creditworthiness. And, if I want to see it, not for 30 days, not a monthly snapshot, but if I want to see my own data I have to pay to do so and it doesn’t matter anyway because the lenders can just hike up their rates if they feel like it.

So, rant over. I fully accept that I may have done something dumb that caused this to happen and I fully accept that some of the views expressed here may be the ignorant rantings of someone without a firm grasp of the necessary quirks of our modern financial system but hey, I’ve got it off my chest and I feel all the better for it.

Thanks and goodnight.

BorisThomson

Your credit score is a meaningless number made up by the credit reference agencies.

HTH.

Pixie5740

ShrewdMover wrote: »

Hi there,

I just wanted to share an experience I had today which left me feeling like a very dissatisfied customer, I hope the forum doesn’t mind a rant which I will try to keep lighthearted and brief.

Today I applied for a loan with M&S bank. I wanted to top up an existing loan from just under £6k to £15k. They offered a rate of 2.8% and I’d been told I could get this rate over a term of 7 years which was perfect.

I spent 45 minutes going through the application on the phone and when the result of the application came back I had been accepted at the ‘slightly higher’ rate of 5.8%. This was offered with no explanation. I declined to take the loan.

I then went and checked my credit score on Experian. A perfect 999. I called M&S back and asked for an explanation and told them I’d checked my score. What else could it be? I don’t have anything else that could affect their decision, surely. They said they could give me no further information, for my own privacy and security.

Now if I’m doing any kind of financials at home and my numbers come out more than double what I was expecting (5.8 = more than double 2.8 right?) I check my numbers again and again until I understand what happened. I don’t think to myself, well, that’s more than I thought I owed the cleaner, she’s getting a good deal this week.

No, I check it and understand it because it’s important to get it right. And now I want to go and get a loan from another provider but I’m scared because that provider will check my credit score too and we all know how bad that can be. ‘Well sir, we checked your credit score and before we checked it, we’d have been able to offer you a great deal. Unfortunately because we checked it we can’t offer you diddly squat'.

It’s a bit like going to EasyJet because you’ve seen a great deal only to find out the actual price is double so going to BA instead and them telling you that because you found out the price EasyJet would give you they’re going to double their price.

And this credit score business…it’s my data. That’s important, GDPR and all. Not only do the credit agencies have a bit of my data, they have all of my important financial data that is used to determine my creditworthiness. And, if I want to see it, not for 30 days, not a monthly snapshot, but if I want to see my own data I have to pay to do so and it doesn’t matter anyway because the lenders can just hike up their rates if they feel like it.

So, rant over. I fully accept that I may have done something dumb that caused this to happen and I fully accept that some of the views expressed here may be the ignorant rantings of someone without a firm grasp of the necessary quirks of our modern financial system but hey, I’ve got it off my chest and I feel all the better for it.

Thanks and goodnight.

Did M&S actually offer you a loan with a rate of 2.8% APR because it sounds strange that you would be offered a rate before even completing an application and being credit checked? I know that the representative rate M&S are advertising is 2.8% APR, representative meaning that it is the rate offered to 51% of successful applicants so it appears you are one of the 49% of successful applicants hence the higher rate.

Forget the 999 from Experian. No lender can see it never mind uses it. Each lender has its own criteria for scoring you based on credit history, affordability and past dealings with the lender in question. There's something within that information that means you are not eligible for the representative rate. It's anyone's guess what that might be since no lender publishes their criteria.

[Deleted User]

1) Ignore credit scores, horoscopes and Scientologists.
2) Accept that lenders have their own risk criteria.
3) Look after your cleaner. Good ones are hard to find.

Pixie5740

You don't have to pay to view the information held by the credit reference agencies. You can view the data held by Experian, Equifax and Call Credit through MSE Credit Club, Clearscore and Noddle free of charge.

bazzyb

ShrewdMover wrote: »

I then went and checked my credit score on Experian. A perfect 999. I called M&S back and asked for an explanation and told them I’d checked my score. What else could it be?

M&S, or any lender for that matter, won't just hand out loans to everyone because Experian gives them a meaningless 999 number.

As to what could have affected the rate, here are some possible things that could have an impact:
- Loan amount
- Existing commitments (or lack of)
- Credit utilisation
- Employment status
- Employment history
- Income
- Electorall roll information
- Address history / stability
- Purpose of loan
- Credit history

This list is by no means exhaustive.

DCFC79

No one else can see your credit score, I repeat no 1. Your history is what lenders see.

Maybe you should watch Martins ITv show that was on last week, he covered credit scores.

PeacefulWaters

Don't worry. In the good old days before risk based pricing they'd have declined you.

Consolidation and seven year term are probably the reasons.

Pixie5740

I think what this board needs is to update the sticky to include an explanation about representative APR since this kind of rant, light hearted or not, pops up regularly as well as an explanation as to what lenders check i.e. not the credit score.

Thrugelmir

ShrewdMover wrote: »

I wanted to top up an existing loan from just under £6k to £15k. They offered a rate of 2.8% and I’d been told I could get this rate over a term of 7 years which was perfect.

What other debts do you currently owe?

Why the need to roll over a £6k loan for another 7 years?

What's the additional £9k for?

All these questions will factor into a lenders decision.

TadleyBaggie

Me too. I know you can use the Report button but it's too much faff.