Conned by my own bank!!!

supersparkle

I have a car I bought 6 years ago (cash) which is now 14 yrs old, and it's only ever passed it's MOT once! Every year it costs me more and more, we're not talking a few quid, but hundreds each time, in fact I've spent over £3500 on a car that today is only worth £250. So I've decided now is the time for a newer car.
After much searching, I have now found a car I want and I need a loan for £6500, I have a deposit of £1000. 
I applied to my bank for a loan and within 10 minutes they accepted my loan application and because my credit score is at Excellent, I was offered an APR of 3.8%, I was well pleased and waited for the follow on email so I could sign for it and pay for my car. Meanwhile I paid a deposit to secure the car.
Except the email didn't come, so I phoned the bank Friday morning and was told if I don't hear anything over the weekend I should apply again Monday morning. So Monday morning I applied again, within 10 minutes they emailed me and offered me a loan... except now the APR was 9.8% and the repayments were £20 a month more and now I can't afford it!!! 
I phoned them in tears I was so upset, and although the person I spoke to at the bank was sympathetic, he doubted the bank would be able to honour the original offer but he would pass it on to another department to deal with and I should hear something within a couple of days. Well, those couple of days have come and gone, I spoke to the bank again this morning but it was a waste of time. 
Now I'm going to have to pull out of buying the car and I will lose my deposit! 
I'm so mad and upset, I'm 62 yrs old, they've screwed up my credit score and I'll never be able to take out affordable credit again. Is there anything I can do?

Ebe_Scrooge

First off, I doubt that you were initially offered a loan at 3.8%.  You made the application, the application was accepted, and 3.8% was the illustrative rate, which is offered to 51% of successful applicants.

Then, they ran your application through their systems, and their OWN INTERNAL scoring algorithms decided to offer you a rate of 9.8%.  You do not have to accept the loan that is offered to you.

The score/rating you see on the CRA is meaningless, it's not used nor even seen by a lender.

You should not have put the deposit down on the car until you had the funds available.  And 1 search will not have "ruined your credit score".  Your score is not a thing, and the search will had a miniscule impact on your credit history.

"Is there anything I can do?".  You could ask the garage if they will refund your deposit as a goodwill gesture - though if the contract states that it's non-refundable, they're under no obligation to do so.  Alternatively, you could make another loan application with a different lender.  2 applications in a short space of time will not do much harm, though more than this should be avoided as it starts to reflect negatively on your credit history.

supersparkle

I can assure you I was offered the loan at 3.8% APR, I have it in black and white in my confirmation email, along with the monthly repayment, it definitely wasn't a illustrative rate, and the bank have already confirmed it to me. Having already made 2 hard searches in a short space of time it has already impacted on my credit history... hence the rate going from the original 3.8 to 9.8% and again confirmed by the bank. Yes I shouldn't have put a deposit down on the car but that's what you do when you want to secure one.
I'm not looking for a lecture, I'm looking for advice. But thanks anyway.

NSG666

Phone the garage immediately and see what they say about the deposit first - the sooner you phone and potentially cancel the sooner they can get the car back on sale and minimise their losses. It used to be the case that if a customer cancelled an order, the seller had to justify any payment they retained i.e. it had to be a reflection of what the loss of the sale had cost them e.g. depreciation and salesperson's commission. If they sell it again this weekend then they won't have lost much.

caprikid1

Sorry but if £20 extra is unaffordable you are spending too much on the car

mcpitman

Can you post the ext of the confirmation email you received for the lower rate loan? 

It may or may not clear this up for us.

[Deleted User]

supersparkle said:

 they've screwed up my credit score and I'll never be able to take out affordable credit again. 

None of that is true.

Your credit score is fictional and has nothing to do with lending and of course you'll be able to take out affordable credit, if you meet risk criteria. Have you reviewed your files to see what is making you higher risk? Is all the data accurate?

You could look elsewhere for a loan, but if a difference of £20 a month is making the loan unaffordable, I would strongly recommend you rethink how much you're spending.  Ask if they will transfer the deposit to a much cheaper vehicle.  

tacpot12

You could make a formal complaint to the bank as you have an email offering the loan at 3.8% and placed a deposit on the strenght of this email. You could ask them to make a goodwill payment towards the deposit. 

I'm doubt that your credit score will be affected materially as a result of two hard searches. 

[Deleted User]

supersparkle said:

I have a car I bought 6 years ago (cash) which is now 14 yrs old, and it's only ever passed it's MOT once! Every year it costs me more and more, we're not talking a few quid, but hundreds each time, in fact I've spent over £3500 on a car that today is only worth £250. So I've decided now is the time for a newer car.
After much searching, I have now found a car I want and I need a loan for £6500, I have a deposit of £1000. 
I applied to my bank for a loan and within 10 minutes they accepted my loan application and because my credit score is at Excellent, I was offered an APR of 3.8%, I was well pleased and waited for the follow on email so I could sign for it and pay for my car. Meanwhile I paid a deposit to secure the car.
Except the email didn't come, so I phoned the bank Friday morning and was told if I don't hear anything over the weekend I should apply again Monday morning. So Monday morning I applied again, within 10 minutes they emailed me and offered me a loan... except now the APR was 9.8% and the repayments were £20 a month more and now I can't afford it!!! 
I phoned them in tears I was so upset, and although the person I spoke to at the bank was sympathetic, he doubted the bank would be able to honour the original offer but he would pass it on to another department to deal with and I should hear something within a couple of days. Well, those couple of days have come and gone, I spoke to the bank again this morning but it was a waste of time. 
Now I'm going to have to pull out of buying the car and I will lose my deposit! 
I'm so mad and upset, I'm 62 yrs old, they've screwed up my credit score and I'll never be able to take out affordable credit again. Is there anything I can do?

If you can prove you were accepted for a loan of 3.8% APR then make a formal complain to the lender in writing.  If you are then not satisfied with the lender's response to your complaint you can then escalate this matter to the ombudsman.

The above will take time so in the meantime your options are:

• To accept the loan of 9.8% APR and buy the car,
• Try to find a cheaper loan elsewhere because despite what you think you will be able to take out affordable credit again.  9.8% APR is certainly far from the worse rate we've seen on the forum and at only £20 a month more than the 3.8% APR loan that shouldn't make it unaffordable unless your finances are sailing very close to the wind.  
• Talk to the car dealer and throw yourself at his mercy to see if you can get your deposit back.  The dealer might even be able to offer you some finance options.
• Lose your deposit and the car

squirrelchops2

Could you ask the garage if they will let you transfer the £1000 deposit to another car then find something a bit cheaper to buy from them so you can afford the monthly repayments?

The_Fat_Controller

Your application for the initial loan was not completed by the bank for some reason as you did not get the loan document to sign but you unfortunately jumped the gun and paid your deposit.

Did the email confirmation say anything about further checks being needed ?

If not, how have the bank explained the lack of the loan document email ?

If an extra £20 per month is unaffordable, it goes to show how a fictional credit score/rating of EXCELLENT is, as a lot of us know, absolute rubbish.