Post BR credit

matilda.cs

Hello,
I’m helping someone with their credit file. 

They went BR mid 2013 and since then have had some credit cards and car finance - all quite high apr due to BR- but currently only has a car on vehicle lease. No other debt at all - all cleared in January 2019. 

She looked to obtain a loan recently but looking on clear score, she had very few options despite her ‘score’ being well above national average (I know this figure is made up)
The BR has long been removed and there are no obvious things on her report that I can see. 

On her credit report it says she can improve her credit rating by getting a credit card - she was given 90% chance of acceptance on pre-approval for a M&S 0% card but this was a straight decline.

What am I missing? Please someone help us! 

matilda.cs

Cards which were cleared in Jan 2019 were around £3-4K but all payments were always made on time. She works part time but earns decent enough wages (household income around £2.5k a month, equally between her and partner)

[Deleted User]

Has she checked all three CRA files?

mwarby

£2.5k joint income per month does suggest quite low salaries, which will factor in to the application score

matilda.cs

£2.5 k (after tax) shouldn’t be poor enough wages to be an instant decline for a credit card. 

I helped her do a credit clean up after the BR came off. Additionally; I’ve just signed her up to a trial of checkmyfile and the only thing I can see is a spike in borrowing in October 2019 where her car finance went from £3k owed to £15k owed, quickly reducing to £12k the week after. (Where there was a cross-over between car finance providers)

[Deleted User]

Her income isn't 2.5k though.  It's only half of that.

The car debt will make it very tough for her to get additional credit at a decent rate.

matilda.cs

I just don’t get why she was given a 70% chance of approval for a nationwide loan, and 90% for a credit card if she has no real life chance of approval. 

Luckily she doesn’t really need additional  finance so she’s not willing to get a credit card from a high APR lender... she just wants to know that she’s in a position to get finance later on, if needed. 

mwarby

Because the company suggesting these products gets some kickback if she signs up, so they want to encourage this

[Deleted User]

90% chance still means 10% will get rejected, so she did have a real life chance.

She'll fare better if she can get her existing debt down.

As well as checking her three files, if she's financially associated with her partner, check theirs too.   

matilda.cs

She’s not financially linked. Her only debt is a car on vehicle leasing - which she is essentially hiring. She gives it back after 4 years and the finance is cleared.