Car Finance Rejected after originally been accepted

Gurn34

In June i went down the local Volvo delearship to enquire about pruchasing a new vehicle on pcp as my existing agreement was coming to an end and I had notified the lender that i would be returning the existing car at the end of agreement.  At the time i realsied my credit score was not good so only if the proposal for finance for the new vehicle would be accepted would i place an order for a new car.  Finance proposal was accepted be the lender and hence i placed deposit for new car.  Everything seemed ok until a few days before i was to collect the vehicle, in November, when the dealership informed me that the lender had now declined the finance proposal.  I have received a letter from the lender stating that application has been declined on credit score.  I have no qualms about being declined but to notify me afew days before collection and state it was down to credit score is annoying as the original application was accepted when my credit score was probably worse.  I have tried reaching out to the lender to ask why i was accepted originally and also why it took so long to notify me of being declined but i have had no response. Any advice on this would be be greatly appreciated as i am confused as what caused the lender to change stance.  

[Deleted User]

So in June you arranged the purchase and paid a deposit.
You waited until November to the finalise the deal.
And at that point you were informed the finance application had failed the affordability check ?
I'm not sure arranging the deal ahead of time was the right move because, surely, any number of factors could alter before the finance proposal was completed.
More learned members will be able to advise on this, let's see who can shed light on it......
@fatbelly , @DrEskimo , @sourcrates ....

Gurn34

No I only placed order for car once finance was approved otherwise i would not.  The issue was i have document showing finance being accepted an dthen a few days before collecting car the lender declined the original acceptance (5 months afrer approving).

Penguin_

It happens unfortunately. A dealer will do a basic check upon first contact which will show suitability then a full check will be done just before you collect the car. Did you take any other credit out in-between the 2 dates?

Gurn34

No other credit was taken out or searches done as i know that can affect the decision too.  My credit score was probably lower when in June as i still had 6 months of the original finance agreement to pay, which was was the same lender at a higher monthly replayment than the new proposal.  The dealership told me it would take approx 5 months for car delivery from June so hence the reason for placing an order.  I have no qualms about being rejected but I was only informed a two days before collecting the vehicle.  That is the annoying part why i was not told earlier.  I thought that because i had been accepted for finance everything was fine.  When i originally bought the first car from teh same dealership using teh same lender it was the same process as again it was a 5 month waiting period for the car.  Finance was agreed and 5 months later i collected my vehicle no problem at all.  Just confused and annoyed as to why different this time.

[Deleted User]

Gurn34 said:

I have no qualms about being declined but to notify me afew days before collection and state it was down to credit score is annoying as the original application was accepted when my credit score was probably worse. 

By 'credit score', they don't mean the pretend CRA credit scores, but the score that they gave you. That score has worsened due to either change in your circumstance, their criteria or the general increase in risk across the board.

If you've 'reached out' for an explanation, don't expect them to reach back at you. as the criteria are confidential.

Penguin_

Gurn34 said:

No other credit was taken out or searches done as i know that can affect the decision too.  My credit score was probably lower when in June as i still had 6 months of the original finance agreement to pay, which was was the same lender at a higher monthly replayment than the new proposal.  The dealership told me it would take approx 5 months for car delivery from June so hence the reason for placing an order.  I have no qualms about being rejected but I was only informed a two days before collecting the vehicle.  That is the annoying part why i was not told earlier.  I thought that because i had been accepted for finance everything was fine.  When i originally bought the first car from teh same dealership using teh same lender it was the same process as again it was a 5 month waiting period for the car.  Finance was agreed and 5 months later i collected my vehicle no problem at all.  Just confused and annoyed as to why different this time.

That's because they will do the full submission for finance 2 days before collection as the funds will be in their account the day you collect & the agreement will become active. If they do this too early then the finance agreement will start before you get the car. 

Gurn34

Thank you for all the advice really appreciate this.  Would the fact that the previous agreement with the same lender was paid without any late payments, on time and completed within alloted time have no bearing on decision?

[Deleted User]

Yes, that has a bearing on the decision. They'll use both internal and external data to assess your risk.

Gurn34

But in this case it seems to have had a negative bearing as when they did the last check the old agreement was completed.  The dealership are recommending that we do another proposal would you advise doing this as i just have a feeling that because I have complained they will hold the next application against me.   

[Deleted User]

No, it hasn't had a negative affect.  It's just that as a whole, your risk is too high for them. 

Your complaint will have no bearing on your application and risk. That's not how lending works.