ARP - loan checker

Laurenzo

Hi, 

My partner used the money saving expert loan checker before applying for a loan with Santander. The loan checker came back with ARP of 3%, chance of acceptance 90%, I understand that rates are flexible, but on applications for the loan Santander offered him ARP 18.5% which is ridiculous higher than 3%. Wondering if anyone has been in this situation, and what they have done? Bit disappointed with Money saving website with the advice we have been given, we have spoke to the bank cancelled the application as it’s far too high, but I am annoyed as it will have left a footprint on our credit history. 

[Deleted User]

It's because your partner is too high risk for the lender. Neither they nor MSE have done anything wrong, so no need to be annoyed.

If you have patchy credit files, don't aim for the top deals, but something lower down the food chain, where you have more chance of being successful.

[Deleted User]

Laurenzo said:

Hi, 

My partner used the money saving expert loan checker before applying for a loan with Santander. The loan checker came back with ARP of 3%, chance of acceptance 90%, I understand that rates are flexible, but on applications for the loan Santander offered him ARP 18.5% which is ridiculous higher than 3%. Wondering if anyone has been in this situation, and what they have done? Bit disappointed with Money saving website with the advice we have been given, we have spoke to the bank cancelled the application as it’s far too high, but I am annoyed as it will have left a footprint on our credit history. 

The "loan checker" will have came back with a representative APR of 3% which is not the same as being offered a loan with an APR 0f 3%.  The representative APR has to be offered to 51% of successful applicants your partner is one of the other 49%.  Plenty have posted on the forum about the same thing before just type "representative APR" into the search.

[Deleted User]

Laurenzo said:

Hi, 

My partner used the money saving expert loan checker before applying for a loan with Santander. The loan checker came back with ARP of 3%, chance of acceptance 90%, I understand that rates are flexible, but on applications for the loan Santander offered him ARP 18.5% which is ridiculous higher than 3%. Wondering if anyone has been in this situation, and what they have done? Bit disappointed with Money saving website with the advice we have been given, we have spoke to the bank cancelled the application as it’s far too high, but I am annoyed as it will have left a footprint on our credit history. 

Unfortunately it is not a guaranteed rate. Most of the time when you do loan checkers they ADVERTISE the representative APR which 51% of successful applicants will receive.

Unless you get a rate that says GUARANTEED on the loan checker, you need to lower you expectations on the APR you receive following a full application. Of course it is harder to appeal a rate then it is to appeal a loan decisions, and no lender I have spoken to will negotiate a rate, but I have seen on a occasion some Lenders change their mind so it's FREE to ask.

I would advise that your Partner sign up to Experian CreditExpert and go through his credit file properly to understand what positives/negatives are listed. It's a free trial.

Then sign up to CheckMyFile.com to see a view of all your credit reports held by the three main Credit Reference Agencies in one screen and do a comparison, it also shows any CIFAS or notices of fraud on their account.

Then you can sign up to MSE Club Credit which is also free to get more insight into your credit healthy and loan/APR eligibility.

You can also sign up to Credit Karma which is free and provides data on your credit file held by Transunion (formerly CallCredit).

To understand if your partners credit history is healthy enough to warrant low APR rates, and then of course you need to look at the data they have supplied on the application such as income/reason for loan/ employment industry... all these things factor in.

We are in a pandemic and this has affected lending criteria, but good APR rates are still out there as I have received low APR rates on loans last week after full application.