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Personal Loan Help

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chmod777chmod777 Forumite
7 posts
Seventh Anniversary Combo Breaker First Post
Hi all,
I need some help with obtaining a loan, please.
I have an Experian credit score of 999 and my other scores are all above average.  There a no issues highlighted.  My unsecured debt is 0%, but I do have 1 secured debt due to be settled this month (car).  I am self-employed (company director taking dividends) - this has been the case for over 4 years.
I wanted to take out a loan to buy a new car.  So I checked my eligibility on the Post Office and they said there was 0 chance and referred me to George Banco - which offers guarantor loans of 34% or more.  George Banco assessed my credit rating as Poor.

Does anyone know what's going on, please?  What is my best course of action?
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Replies

  • sourcratessourcrates Forumite, Board Guide
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    Hi,
    Save up and buy a cheaper car perhaps ?
    A lot of bankrupts have 999 credit ratings, just shows how much notice you should take of credit scores.
    Without knowing your circumstances it’s impossible for anyone on here to give you a specific reason why you were declined.
    I'm a Board Guide on the Debt-Free Wannabe, Credit File and Ratings, Bankruptcy And Living With It, boards. "I volunteer to help get your forum questions answered and keep the forum running smoothly".
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  • edited 31 May at 7:59PM
    chmod777chmod777 Forumite
    7 posts
    Seventh Anniversary Combo Breaker First Post
    edited 31 May at 7:59PM
    Thanks.  A cheaper car is definitely an option, but still confused.  I've been paying off a car loan quite happily for 4 years and the personal loan should be cheaper than that.
    I can provide more detail if it would help, assuming I can do so without getting too personal.
  • macmanmacman Forumite
    45K posts
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    Forget credit scores, it's a fictitious number that lenders don't see anyway.
    Could it be that you lack a credit history, rather than have a poor one? What other credit do you use?
    No free lunch, and no free laptop ;)
  • edited 1 June at 3:37PM
    DCFC79DCFC79 Forumite
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    edited 1 June at 3:37PM
    Buy 1 with cash, if you go secured route the loan is secured on the car and if you don't make a payment or multiple payments the car is at risk of being taken off you.
    So the only negative on your file is the secured loan ?
    If it were me I wouldn't use George Banco, Id use use cash or a loan.
  • mcpitmanmcpitman Forumite
    891 posts
    Eighth Anniversary 500 Posts Name Dropper
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    What are you putting as your income? (value and breakdown of salary/divi's).
    How much are you trying to borrow? More than your annual income may be difficult even if secured.

    Life isn't about the number of breaths we take, but the moments that take our breath away. Like choking....
  • chmod777chmod777 Forumite
    7 posts
    Seventh Anniversary Combo Breaker First Post
    Thanks for the replies.
    I have a credit history of mortgage and the secured car loan. Neither have any missed payments and the secured car loan is completed in a couple of weeks (its PCP so still 18k outstanding until I hand the car back).
    I'm looking at a loan of 15k over 4 years.
    When entering income, I've entered approx 50k, as that's what I took in salary and dividends last year. However, not really sure if this is correct. Should I be putting company income in?  Would it be better to call a bank and try to speak with a human?
  • chmod777chmod777 Forumite
    7 posts
    Seventh Anniversary Combo Breaker First Post
    Oh and I have an amex with a high limit but that I hardly use.
  • maxximus75maxximus75 Forumite
    370 posts
    100 Posts Second Anniversary
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    Maybe the decline is down to affordability as you are still showing to an algorithm as an £18k pcp debt plus mortgage in a time when, credit such as loans/cards etc have tightened up over the past couple of months, due to the pandemic and also being self employed.... it all gets factored in.
    It could be that you just don't fit the current criteria for a Post Office loan?

  • MinuteNoodlesMinuteNoodles Forumite
    577 posts
    500 Posts Name Dropper
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    chmod777 said:
    When entering income, I've entered approx 50k, as that's what I took in salary and dividends last year. However, not really sure if this is correct. Should I be putting company income in?  Would it be better to call a bank and try to speak with a human?
    Some lenders won't count dividends as income. You can't put the company income in if it's a Ltd company because that income is not yours, it's the company's as under UK law the company is a separate legal entity. You could only put the company income in if you were a sole trader.
    However it could be income related. As far as they're concerned you have £18k secured debt, even though it ends soon, plus whatever 0% debt you have and a mortgage. If the secured and unsecured debt is starting to head towards the majority of your £50k salary then you'll be declined on affordability. You will probably have more success once you've ended the PCP deal and it's shown as settled/closed on your credit file however that'll only apply if you don't go out and take out another PCP deal because you'll then be back in the same situation with finance being very high compared to your income.


  • macmanmacman Forumite
    45K posts
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    chmod777 said:
    Thanks for the replies.
    I have a credit history of mortgage and the secured car loan. Neither have any missed payments and the secured car loan is completed in a couple of weeks (its PCP so still 18k outstanding until I hand the car back).
    I'm looking at a loan of 15k over 4 years.
    When entering income, I've entered approx 50k, as that's what I took in salary and dividends last year. However, not really sure if this is correct. Should I be putting company income in?  Would it be better to call a bank and try to speak with a human?
    No credit card, mobile phone contract, utility bills?
    No free lunch, and no free laptop ;)
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