Payday loans on credit file

Debtfreestudentnurse

I stupidly took payday loans in the last year of my degree to help with childcare costs, without thinking about the impact on my credit file.

They were paid back on time, and no payments were missed.

I’ve just checked how they are recorded, and noticed they say ‘unsecured loan’.

Is this as much of a problem when applying for a mortgage? Will they still know they are payday loans?

[Deleted User]

It’s an unsecured loan as it’s not secured against a property or anything.

A lender will see things slightly differently and may see it as a STL or PDL

Debtfreestudentnurse

Thanks. Just wondered as one says unsecured loan and another says advance against income.

boo_star

Debtfreestudentnurse wrote: »

I stupidly took payday loans in the last year of my degree to help with childcare costs, without thinking about the impact on my credit file.

They were paid back on time, and no payments were missed.

I’ve just checked how they are recorded, and noticed they say ‘unsecured loan’.

Is this as much of a problem when applying for a mortgage? Will they still know they are payday loans?

Are they in the "short term loans" section of your credit report?

Debtfreestudentnurse

No, they’re all paid off now so are in closed accounts, but they’ve never been in that section.

boo_star

Debtfreestudentnurse wrote: »

No, they’re all paid off now so are in closed accounts, but they’ve never been in that section.

A lender may still infer from their duration and amount what they are so unfortunately not being listed as a short term loan might not get you off the hook.

[Deleted User]

It depends how the lender reported it.

Advance Against Income is definitely a DPL marker.

Debtfreestudentnurse

Have I killed my mortgage chances? We were going for adverse lenders anyway.

boo_star

Debtfreestudentnurse wrote: »

Have I killed my mortgage chances? We were going for adverse lenders anyway.

If they're >1 year old you may find a few lenders that are OK with them.

Speak to a broker.

Debtfreestudentnurse

The last one will be a year by the time we’re ready to apply.

Thanks.

[Deleted User]

You’ll need to speak to a broker who specialises in adverse credit files/history.

You’ll get one but likely at a higher interest rate (around 4-5%).