Loan Rates

sonofmerton

'I know COVID is a factor but SOME people are getting those rates'
every person is different. even someone earning the same amount as you and with the same credit record. that doesn't mean you will both get the loan and or for the same interest.

banks unfortunately are not required to say why you would pay 19% interest and a comparable person only pays say 8%. you can only try to get the best deal out there that banks are prepared to give you personally. 

companies that say you have a great score or you have an excellent chance of this or that talk balderdash. the bank will make the decision based on you with whatever criteria they choose, be it defaults, current debt, location, age, or many other reasons. if it means they reach the conclusion that 19% is their charge then that is what it is. you will never be told why. 

MrFrugalFever

Then why not take out the car finance on a much lower rate that’s a secured loan against an asset rather than a very high unsecured loan against you personally? 

[Deleted User]

Mr_Eko said:

Deleted_User said:

Mr_Eko said:

Deleted_User said:

Your score is meaningless, no lender ever sees it

Check MSE Credit Club, Clear Score and Credit Karma and look carefully at every report to check for anything dodgy. Consider too existing debts and how much you want to borrow

Also, even for a 60k salary, 25k unsecured debt is very high risk for a lender. Depending on what you need the money for, it might be better to split it into smaller amounts and do it over time

Hi, appreciate the response!

There’s literally nothing dodgy on my credit report. That’s why I’m asking. I have all of the apps, paid services - Karma, ClearScore, Experian etc. Ordered the full report too.

No other debts.

Plus I had a £20k loan @ 3% before so it’s nothing to do with the amount clearly.

Anyone actually know or....?

Maybe stop wasting money on the pointless paid CRA services?

Clearly it IS to do with the amount and indeed, the current climate. What you got in the past is nothing to do with the current day. Borrow less or take the 19%. On 60k a year you should be able to save plenty of cash a month anyway so delay your purchase and save

Hi!

Oh come on - as if I’ve paid for them. They are all free trials. I was curious to see if there was anything beyond the actual score itself.

It doesn’t really answer the question though - companies like Zopa state on their website say that you have a ‘great’ credit score and that means you have the ‘best chance at getting the best rates’ and that the ‘score’ is only 50% of the decision. The other 50% is disposable income, of which I have plenty. Then slap you with a 13-15% rate. That’s a tiny little bit misleading.

I know COVID is a factor but SOME people are getting those rates.

I’m just curious and thought I’d ask.

Thanks for the tips!

Credit score has, unfortunately, become increasingly synonymous with credit record (hence sites like that continuing to mention it) which is also not helped by sites like this continue to propagate the myth (Martin himself keeps talking about the score on TV). The CRAs want to keep this going because they want a system like the US where the score is the be all and end all of lending which gives them great power.

Lenders only have to give 51% of accepted applications the advertised rate, 10,000 people could apply, 100 could be accepted and 51 given the low rate and the company would comply with the rules.

You now seem to be asking the question "what do lenders use to determine my rate" - no-one but the lender knows the details of why they accept or reject or give the rate they do (something you will never find out, to stop people trying to game the system).

If you don't like the answers you have been given, feel free to keep asking the same question over and over again until someone tells you what you want to hear, even if it's wrong.

Sncjw

How many hard searches have you got recently
 

helpyhelper

Now that mainstream overdrafts are 40% plus, 20% is well below payday rates. But you are right, you should be getting better rates if you have a good credit score. 

Penguin_

Mr_Eko said:

Deleted_User said:

Your score is meaningless, no lender ever sees it

Check MSE Credit Club, Clear Score and Credit Karma and look carefully at every report to check for anything dodgy. Consider too existing debts and how much you want to borrow

Also, even for a 60k salary, 25k unsecured debt is very high risk for a lender. Depending on what you need the money for, it might be better to split it into smaller amounts and do it over time

Hi, appreciate the response!

Sorry when I said ‘score’ I meant report.

There’s literally nothing dodgy on my credit report. That’s why I’m asking. I have all of the apps, paid services - Karma, ClearScore, Experian etc. Ordered the full report too.

No other debts.

Plus I had a £20k loan @ 3% before so it’s nothing to do with the amount clearly.

My question was: do they need to tell me exactly what the issue is or is that not true?

Thanks!

Has this been paid off or is it still being repaid?

[Deleted User]

helpyhelper said:

Now that mainstream overdrafts are 40% plus, 20% is well below payday rates. But you are right, you should be getting better rates if you have a good credit score. 

The credit score is not an indication of any chance, or not, of getting good rates, no lender ever sees it. Decisions are made based on your credit history, run through a scoring system that the bank keeps secret.

[Deleted User]

DrEskimo said:

It's a very substantial sum of money over a very long period during a very uncertain time....

Why do you need to borrow so much? How much do you have saved and how much do you save each month?

Nebulous2 said:

£25k and 7 years gives them a lot of risk - and they want paid for it. That smacks of desperation to a lender.

The best deals are often £7.5-£15k over 3 years. 

Do you have a partner? Could you split the loan between two of you? On your income, do you really need to take 7 years to repay a loan? 

No it is not all that substantial, you are both having a hissy-fit and over-exaggerating. Seriously, this forum sometimes.... it treats loans like the mark of the devil when it couldn't be further from the truth.

There are plenty of lenders that offer 30-50K personal loans UNSECURED.

I was approved for a 25K Loan over 7 years back in August 2020, while having 20K existing debt.

Now for the same loan, and with only 15K existing debt I am getting denied.

Lending criteria has become stringent due to covid and they are only catching up to the crisis now... but back in July/August I was getting plenty of approvals for 20K+ loans over 5 and 7 years/

So please calm down, these loans are common.

[Deleted User]

Mr_Eko said:

Deleted_User said:

Mr_Eko said:

Deleted_User said:

Your score is meaningless, no lender ever sees it

Check MSE Credit Club, Clear Score and Credit Karma and look carefully at every report to check for anything dodgy. Consider too existing debts and how much you want to borrow

Also, even for a 60k salary, 25k unsecured debt is very high risk for a lender. Depending on what you need the money for, it might be better to split it into smaller amounts and do it over time

Hi, appreciate the response!

There’s literally nothing dodgy on my credit report. That’s why I’m asking. I have all of the apps, paid services - Karma, ClearScore, Experian etc. Ordered the full report too.

No other debts.

Plus I had a £20k loan @ 3% before so it’s nothing to do with the amount clearly.

Anyone actually know or....?

Maybe stop wasting money on the pointless paid CRA services?

Clearly it IS to do with the amount and indeed, the current climate. What you got in the past is nothing to do with the current day. Borrow less or take the 19%. On 60k a year you should be able to save plenty of cash a month anyway so delay your purchase and save

Hi!

Oh come on - as if I’ve paid for them. They are all free trials. I was curious to see if there was anything beyond the actual score itself.

It doesn’t really answer the question though - companies like Zopa state on their website say that you have a ‘great’ credit score and that means you have the ‘best chance at getting the best rates’ and that the ‘score’ is only 50% of the decision. The other 50% is disposable income, of which I have plenty. Then slap you with a 13-15% rate. That’s a tiny little bit misleading.

I know COVID is a factor but SOME people are getting those rates.

I’m just curious and thought I’d ask.

Thanks for the tips!

Mr_Eko said:

Deleted_User said:

Mr_Eko said:

Deleted_User said:

Your score is meaningless, no lender ever sees it

Check MSE Credit Club, Clear Score and Credit Karma and look carefully at every report to check for anything dodgy. Consider too existing debts and how much you want to borrow

Also, even for a 60k salary, 25k unsecured debt is very high risk for a lender. Depending on what you need the money for, it might be better to split it into smaller amounts and do it over time

Hi, appreciate the response!

There’s literally nothing dodgy on my credit report. That’s why I’m asking. I have all of the apps, paid services - Karma, ClearScore, Experian etc. Ordered the full report too.

No other debts.

Plus I had a £20k loan @ 3% before so it’s nothing to do with the amount clearly.

Anyone actually know or....?

Maybe stop wasting money on the pointless paid CRA services?

Clearly it IS to do with the amount and indeed, the current climate. What you got in the past is nothing to do with the current day. Borrow less or take the 19%. On 60k a year you should be able to save plenty of cash a month anyway so delay your purchase and save

Hi!

Oh come on - as if I’ve paid for them. They are all free trials. I was curious to see if there was anything beyond the actual score itself.

It doesn’t really answer the question though - companies like Zopa state on their website say that you have a ‘great’ credit score and that means you have the ‘best chance at getting the best rates’ and that the ‘score’ is only 50% of the decision. The other 50% is disposable income, of which I have plenty. Then slap you with a 13-15% rate. That’s a tiny little bit misleading.

I know COVID is a factor but SOME people are getting those rates.

I’m just curious and thought I’d ask.

Thanks for the tips!

Agreed, TSB also make it a point to list out the credit scores for all three CRA's and that they target "high" credit scores.

So... yeah some Lenders definitely take it on board.

[Deleted User]

Deleted_User said:

Your score is meaningless, no lender ever sees it

Check MSE Credit Club, Clear Score and Credit Karma and look carefully at every report to check for anything dodgy. Consider too existing debts and how much you want to borrow

Also, even for a 60k salary, 25k unsecured debt is very high risk for a lender. Depending on what you need the money for, it might be better to split it into smaller amounts and do it over time

Deleted_User said:

Your score is meaningless, no lender ever sees it

Check MSE Credit Club, Clear Score and Credit Karma and look carefully at every report to check for anything dodgy. Consider too existing debts and how much you want to borrow

Also, even for a 60k salary, 25k unsecured debt is very high risk for a lender. Depending on what you need the money for, it might be better to split it into smaller amounts and do it over time

Erm not it's not?

How do you even calculate what is high risk, or is this your OWN opinion? Is it based on anything????

Actually, the universal formula used for calculating debt to income ratio is to take your GROSS annual income monthly and compare it to the monthly debt expenditure.

So you''ll find that 25K debt against 60K salary is perfectly adequate.

Happy to see any of your links or documentation that refute the above.